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Blockchain to transform marine logistics

29 May 2017

Blockchain technology could save the marine industry trillions of dollars in processing fees and provide new trust in logistics, according to a report from Marsh.

It estimates the software platform for digital assets could save $US300 ($399.24) per container in labour and processing. For a ship carrying 18,000 containers, this translates to a saving of about $US5.4 million ($7.18 million).

A study by Danish transport and logistics company Maersk showed that on average about 30 people “touched” a product shipped by container, resulting in more than 200 separate transactions, each requiring a different set of documents.

Each human interaction via outdated computer systems, email, phone calls or faxes represents “a potential point of failure, vulnerable to illicit manipulation or simply human error”.

Blockchain would eliminate many of these logistics problems.

Each blockchain consists of records, or “blocks”, which reference and identify the previous block using a cryptographic function. This forms an unbroken, verifiable chain of custody, preserving old transactions forever and permanently adding new transactions to the ledger.

“The beauty of this process is it’s distributed, meaning it can live on multiple computers at the same time, accessible to anyone with an interest in that particular transaction,” Marsh says.

As well as eliminating costly processes, it will also create trust and partnership by providing a “single version of the truth” to all parties.

However, blockchain needs a system of governance, and consideration of its implications in very poor countries where automation would replace jobs, Marsh says.

The report also examines the risk of operating autonomous ships and the implications of cyber piracy, and reducing emissions and building “greener” fleets.


 - insuranceNEWS

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