IBM and Danish transport company Maersk said they were working together to digitize, manage and track shipping transactions using blockchain technology.
The technology, which powers the digital currency bitcoin, enables data sharing across a network of individual computers. It has gained worldwide popularity due to its usefulness in recording and keeping track of assets or transactions across all industries.
The blockchain solution being built by the two companies is expected to be made available to the ocean shipping industry later this year, according to a joint statement from IBM and the container unit of A.P. Moller-Maersk. It would help manage and track the paper trail of tens of millions of shipping containers globally by digitizing the supply chain process from end to end.
This will enhance transparency and make the sharing of information among trading partners more secure.
When adopted at scale, the solution based on the Linux Foundation's open source Hyperledger platform has the potential to save the industry billions of dollars, the companies said.
"Working closely with Maersk for years, we've long understood the challenges facing the supply chain and logistics industry and quickly recognized the opportunity for blockchain to provide massive savings when used broadly across the ocean shipping industry ecosystem," said Bridget van Kralingen, senior vice president of industry platforms, at IBM.
IBM and Maersk intend to work with a network of shippers, freight forwarders, ocean carriers, ports and customs authorities to build the new global trade digitization product, the companies said.
The product is also designed to help reduce or eliminate fraud and errors and minimize the time products spend in the transit and shipping process.
For instance, Maersk found that in 2014, just a simple shipment of refrigerated goods from East Africa to Europe can go through nearly 30 people and organizations, including more than 200 different communications among them.
The new blockchain solution would enable the real-time exchange of original supply chain transactions and documents through a digital infrastructure that connects the participants within the network, according to IBM and Maersk.