Miller Magazine Issue: 126 June 2020

66 67 TECHNOLOGY PLATFORM TECHNOLOGY PLATFORM MILLER / JUNE 2020 MILLER / JUNE 2020 mature technologies for enterprise implementation. A distributed ledger carries some notable advantages, including de- centralization, greater flexibility, greater transparency, audit trail, in- dependence, and more. But Block- chain is just one of the many compo- nents of the platform. The platform is built leveraging the modern cloud-native software architecture with the best of breed components to ensure platform reliability, securi- ty and scalability. We have also entrusted the plat- form development and operations to ConsenSys – a market-leading Ethe- rium blockchain technology company that has a proven track of delivering various Blockchain application and applies the highest standards and tools to enable information security, data immutability and protection. Where and when will Covantis launch its first operation? We plan to launch a pilot release in July 2020 to a smaller number of companies and users to ensure smooth operations, final platform validation and testing. Our first re- lease will take place in September 2020 provided no impediments re- lated to the current pandemic crisis. Our first operation will be the bulk export of soybeans and corn out of the port of Santos in Brazil. We then plan to roll-out and enable the launch of ad- ditional ports and further grains & oilseeds commodities exported from Brazil before moving to other origins. Our next steps of development in 2021 will focus on shipments from the US Gulf. We will at the same time develop new functionalities and plan our next expan- sion roadmap in terms of commodities and origins. How would you define the blockchain-based transaction? Would you call it a ‘digital revolution in commodity trading’? Will blockchain change the world of commodity trade? Any digital platform will be transformational for our industry. Our industry has not significantly changed the way we operate in the past 200 years. If you look at a Bill of Lading back in 1800, you would find that in essence, it is very similar to the paper Bills of Lading we use today. Most processes are manual, paper and labor-reliant and prone to a lot of errors, inefficiencies and duplications. The case for blockchain is even stronger as the COVID-19 pandemic underscores the need for more resilient global supply chains, trusted data and an eco- nomic recovery enabled through trade digitization. How will this new technology affect global trade flows? What are the potential impacts on commod- ity trading? Do you think this new legacy would in- fluence commodity prices? The purpose of the platform is to improve the oper- ations processes by reducing the cost of execution and avoiding operational costs and risks. It is not meant to influence commodity prices in any direction. Is the new platform open to new entrants and smaller players? The platform will be open to everyone who is involved in our industry, smaller players and new entrants can use Covantis just like anyone else. In the first release of the platform, we plan to onboard exporters and import- ers of agricultural commodities in bulk. Those would ini- tially be shippers, fob/fob sellers and charterers. In the later releases, we plan to onboard the Cif/Cfr buyers as well as the services providers such as supervision/ inspection, fumigation, agents. Do you think the system has any risks or handi- caps? Are there any risks of abuse? What are some potential challenges? We believe our platform will reduce the risks associ- ated with the operations, will facilitate the digitalization and streamline the process. Ultimately, our platform will drive and promote the use of more digital tools and digital documents which will transform the way the in- dustry works today. Today many of those documents are requested for and issued as hard paper which is then couriered to its recipients – the exporters, the banks, the importers, the ports, the agents. Often documents need to be sent from one office to another multiple times before they reach their final destination. This takes time, money and there is a risk of documents being lost. Blockchain and digital technologies in general are great tools to offer in- creased security and data protection – far beyond what we have today when most of the information is transferred in Outlook, is stored on the comput- ers of the operations employees han- dling the shipments. Of course risks of handicaps, abuse, violations always exist and they are relevant today for any organization regardless of the use of Blockchain or not. We will be taking rigorous measures to ensure proper testing, risk assessment, audit processes and procedure are in place to avoid such situations. In terms of challenges probably the biggest challenge yet opportuni- ty we face right now is the current pandemic situation due to the un- certainty and disruption to the nor- mal operating processes. Onboard- ing platform participants in such an environment will require resilience, increased focus on change manage- ment, empathy and humbleness to the challenges all users are facing in adopting and using any new digital tool or platform in such a challeng- ing environment. Is there anything else you would like to add? There is a great overview provided by the World Eco- nomic Forum focusing on explaining in a simple way what Blockchain is all about and its advantages. It is accessible on the following link: http://widgets.weforum.org/blockchain-toolkit/ modules/