Trader Glencore has joined a group of charterers aiming to digitalise transactions globally.
Cargill said its rival had signed up to the initiative it began last October with Louis Dreyfus, Archer Daniels Midland and Bunge, together the world's four largest grain traders. COFCO also joined later.
The group is looking at new technologies such as blockchain and artificial intelligence to automate grain and oilseed post-trade execution processes, reducing costs needed to move agricultural and food products around the globe.
It is expecting a launch of the new platform in the second half of 2020 subject to regulatory approval.
“We’ve been interested in the initiative from the very early days and we’re excited now to join as a full partner,” said Glencore Agriculture CEO David Mattiske.
“The digital platform this group intends to develop will leverage the newest technologies and has the potential to revolutionise our industry, making contract execution processes more efficient, more accurate and more transparent.
"These advances are necessary for our industry to continue serving our critical global role efficiently and effectively, and the benefits will be felt by companies of all sizes along the post-trade value chain.”
Workshops and round-table discussions have been held with shippers, charterers, buyers, service providers, financial institutions, trade associations, industry standards and regulatory authorities.
A pilot project will soon be run covering shipments of soybeans from Brazil to China.
The group is also finalising the selection of technology providers and partners.
“This effort is growing, and the reason is clear: we’re offering clear and tangible benefits for the industry, created by the industry,” the companies added in a joint statement.
“Customers, partners and other industry participants appreciate both the potential that our platform offers, and the fact that we are partnering with them early in the process to ensure the entire industry’s needs are met.”
