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Binkabi Commodity Monday #6 | View online in your own language

Blockchain tech coming to commodity markets

Commodity Monday, 15 October

Thailand Studies Blockchain for Applications in Intellectual Property, Trade Finance

CCN 

Two feasibility studies on blockchain technology have been launched by Thailand’s Ministry of Commerce. The studies, which will focus on exploring the use of blockchain technology in trade finance and the registration of intellectual property, are expected to be completed in February 2019, per the Bangkok Post.

With regards to trade financing, Pimchanok Vonkorpon, the director of Thailand’s Trade Policy and Strategy Office (TPSO) which falls under the commerce ministry, pointed out that blockchain technology will assist in enhancing transparency, reducing the cost of doing business and shortening the whole process.

The TPSO is also working on using the technology in processing organic rice exports with a view of eliminating delays and cutting costs. Currently, the time taken to process organic rice exports from the Southeast Asian country is between 15–20 days with a lot of bureaucracy involved along the way that adds expenses.

“Using blockchain for the process could reduce processing time to less than three days, improving transparency and increasing confidence and trust for exporters and foreign importers, benefiting Thai farmers.”

Blockchain tech Coming to Commodity Markets, Blythe masters Says

Bloomberg

The blockchain is coming to commodity markets, Blythe Masters told 2,000 metals producers, buyers, brokers and investors at the London Metal Exchange annual dinner this week. Masters, the wunderkind who made managing director at JPMorgan at 28, went on to become head of global commodities and helped develop the credit-default swap. 

“Supply chains are notoriously complex and inefficient,” Masters said. “This is especially true in the metals and mining industry where many operational and commercial practices remain inefficient and antiquated, leading to critical data omissions, security vulnerabilities, expenses, corruption, and unethical provenance.”

“Blockchain facilitates the exchange of critical trade documents, bills of lading, letters of credit between connected users securely and confidentially”

ITFC launches Islamic trade finance programme for West Africa’s SMEs

GTReview

The International Islamic Trade Finance Corporation (ITFC) has launched a number of initiatives in West Africa, including a new SME programme, to improve access to trade finance in eight countries in the West African Economic and Monetary Union, namely Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal and Togo.

Also announced was a US$1.5bn framework agreement between the government of Burkina Faso and ITFC. Under this deal, ITFC will help finance the export of agricultural commodities, such as cotton, and the import of agricultural inputs and foodstuff, as well as commodities such as crude oil and refined petroleum products. It will also extend financing lines to local banks to support SMEs.

IBM takes its food supply blockchain solution worldwide

supplychaindive

After 18 months of testing, IBM Food Trust, a blockchain-based food and supply chain solution, is “generally available,” the company said Monday.

IBM built out a modular solution to meet different needs. It uses GS1 standards to communicate product data, and it is built on an open source platform to facilitate interoperability. The solution’s modules include:

  • Trace: The module promises to help “members of a food ecosystem” see a product’s value chain journey in seconds. “A process that often takes weeks using other methods,” according to the press release.
  • Certifications: The module digitizes certificates, “such as organic of fair trade,” boosting speed of certificate management by up to 30%, according to IBM.
  • Data entry and access: A module for secure data management on the blockchain.

The solution was first conceived as a tool to address food safety and recall processes. However, “IBM Food Trust has evolved to focus on optimizing the food supply by improving shelf life and product freshness, reducing waste and making the supply chain more efficient, collaborative and transparent,” according to the spokesperson. Suppliers can share data at no cost, but the solution’s software as a service (SaaS) modules must be purchased via subscription, according to the press release.