Blockchain technology, until now mainly associated with cryptocurrencies, could soon bring about the biggest disruption to the shipping industry since the advent of container shipping.

Shipping and logistics are still seen as relatively archaic industries; just one shipment can require more than a hundred documents to be sent back and forth via mail or e-mail between the various organisations involved. Blockchain technology has the potential to drastically reduce, if not entirely replace, all of this with a distributed ledger.

Two major players in the industry co-founded a blockchain platform for processing shipping documents and transactions digitally. The platform now hosts 15 ocean carrier lines and over 40 port and terminal operators.

This platform gives trading partners across the whole supply chain a single, shared view of a transaction, while ensuring confidentiality, privacy and integrity of data. This gives shippers, port and terminal operators, customs authorities and other authorised parties real-time access to digital shipping documents and data.

The benefits for the shipping industry of processing documents and transactions in this way are significant:

• More efficient: overall transit time of cargo could be reduced by up to 40%;
• Aspects of document/transaction processing can be automated using blockchain Smart Contracts;
• Dealing with partners directly through the ledger eliminates the need for costly mediators.

Carrying out business interactions through a blockchain also increases trust between trading partners, since transactions logged in a distributed ledger are immutable, updates are visible in near real-time and the data is not hosted centrally by any single organisation, making it very hard to tamper with. For shipping and logistics, this means:

• Increased cooperation and transparency throughout the supply chain;
• Fewer errors, resulting in 1) fewer shipping delays and 2) improved safety by reducing instances of misdeclared cargo.

A bright future awaits shipping companies that embrace this change, and blockchain technology could change the way we move goods around the globe forever.