The global freight business doesn’t see much innovation. Now that major shipping companies are developing blockchain logistics platforms, that could be changing. Blockchain logistics solutions could make global shipping a far more efficient system. Numerous blockchain logistics projects are under-way, but it is difficult to know how the industry will evolve.
According to some estimates, as many as 20% of the global fleet of shipping containers are off-the-grid at any point in time. There is no good way to keep track of them, and there are so many floating around the world’s logistics system. This is just one example of how the archaic haulage infrastructure is breeding inefficiency and could be helped by blockchain logistics innovation.
Many of the largest haulage companies are working on blockchain logistics platforms. Earlier this year IBM and Maersk announced they would begin to develop a blockchain logistics platform. They have been joined by some of the biggest names in global shipping. With so many projects under development, there could be a complex situation in the future.
Blockchain logistics can be open
One of the biggest advancements in the history of modern shipping was the introduction of the standardized shipping container in the 1960’s. Making a common set of sizes for non-bulk haulage made standardized global infrastructure a possibility for industry. Standard sized shipping containers changed how global logistics happened in the physical world, but in the back office, not a whole lot changed.
Now blockchain logistics platforms could do for the back office in global shipping what standardized containers did for the physical goods. The idea that blockchain is revolutionary isn’t lost on the world’s largest shipping companies. FedEx has been working to create a blockchain-based system that would allow their counterparties and customers to access data, which would help everyone involved.
As it stands today, the records that accompany a shipment aren’t centralized and may be spread over four or more entities. There are some standards that have to be followed, but the lack of integration in global logistics makes a sector that is vital for global trade slow and cumbersome.
New projects are everywhere
In addition to FedEx, and IBM/Maersk, major players in the global logistics space are working to create blockchain logistics platforms. The Port of Rotterdam announced a program that would use blockchain-based records to speed cargo through the port, and the European Union recently announced that 24 member states would be part of the EU blockchain partnership.
Denmark announced they would be the first nation in the EU to use blockchain to register ships. Denmark was also a signatory on the recent EU blockchain partnership. The Danish Minister for Industry, Business and Financial Affairs, Brian Mikkelsen, commented after signing the declaration, “Blockchain goes across borders, and a joint European cooperation is crucial to ensure future-proof standards and solutions. So I’m very pleased that we have now signed this declaration.”
Fintech has been a big source of news for cryptos and blockchain. But the blockchain logistics sector seems like it is taking off around the world. The global logistics sector is estimated to be worth USD 4 trillion annually and could benefit from increased efficiency at many levels.
Nicholas Say was born in Ann Arbor, Michigan. He has traveled extensively, lived in Uruguay for many years, and currently resides in the Far East. His writing can be found all over the web, with special emphasis placed on realistic development, and the next generation of human technology.