The container logistics industry will see improved connectivity, efficiency and security thanks to blockchain. That’s the conclusion of a successful pilot program, delivered by logistics technology company Marine Transport International (MTI), and summarised in a whitepaper written and verified by the University of Copenhagen and Blockchain Labs for Open Collaboration (BLOC).

The project, which has connected supplier, shipper, load point, customs and terminal on a shared blockchain ledger, has far reaching consequences for the logistics industry as it seeks new ways to improve security and profitability. All parties involved in the supply chain benefit from automated data flows as the system allows complete interoperability of data sources, even including legacy systems.

Jody Cleworth, CEO of Marine Transport International, said: “The results of this successful pilot demonstrate the strengths of blockchain technology when deployed to link the various actors in the supply chain. We are confident that firms throughout the logistics industry will see a broad spectrum of benefits stemming from blockchain deployment.

In the pilot, shipment information was captured at a load point by MTI’s application, recorded on the dedicated blockchain, and given a unique ID. It was instantly confirmed back to the load point and validated for provenance (tying the data to the geographical location of the weighbridge). Finally, a data message was submitted using the EDIFACT format over SFTP to the shipping portal INTTRA for further relaying to the shipping lines.

This was achieved instantly. Conducted normally, the whole process would require significant uploading and reformatting of data, often manually, to achieve the same result.

Cleworth continued: “The blockchain has proven to be an excellent way of connecting the different parties involved in any supply chain environment due to the transparency and security-by-design of the technology. In recent months the shipping industry has fallen victim to industrial scale cyberattacks which have left large shipping lines, such as Maersk, completed paralyzed and unable to serve clients.

“A blockchain-enabled supply chain is highly resilient to cyber-attack – a copy of the essential shipping data is stored on each node on a decentralised network, meaning that even if one node is compromised, the data is safe nevertheless.

“The business case for connecting supply chains using blockchain is very strong. As the interface is easily adaptable to existing systems there is a very low barrier to entry.  Any type of supply chain business, be it marine, air, or land-based, can take advantage of such a system – the cost savings that we envisage are as high as 90%, as a result of substantially streamlined processes.”

Karim Jabbar, co-author of the paper, from the Department of Computer Science at the University of Copenhagen, added: “This pilot demonstrates the great potential for distributed ledger technologies to be used in improving supply chain processes. The Container Streams system is unique in the fact that it does not require the complete replacement of existing systems – instead, MTI’s solution allows complete interoperability with existing legacy infrastructure. The logistics industry as whole can expect better visibility, connectivity and cost savings as a result of distributed ledger adoption.”

Deanna MacDonald, CEO of Blockchain Labs for Open Collaboration said: “We have documented the first phase of this use case, its implications for the maritime industry and the resulting development of a turn-key application ecosystem for global supply chain logistics. However, the future potential of this ecosystem platform will rest upon collaboration from the different actors in these supply chains in order to clearly identify the problems and co-create applications that solve for the collective challenges they are facing today.”

The whitepaper, ‘Container Streams’, is available and can be sent over if requested.