Glencore Agriculture Ltd, has joined Archer Daniels Midland Company (ADM), Bunge, Cargill, COFCO International and Louis Dreyfus Company (LDC) in an industry-wide initiative to modernize global agricultural commodity trade operations. The initiative is initially looking at new technologies – such as blockchain and artificial intelligence – to create digital solutions to automate grain and oilseed post-trade execution processes, reducing costs needed to move agricultural and food products around the world. The group is projecting 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 to join as a full partner,” says Glencore Agriculture Ltd CEO David Mattiske. “The digital platform this group intends to develop will leverage the newest technologies and has the potential to revolutionize 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.”
Glencore’s collaboration demonstrates how the industry effort is growing. “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,” says a joint statement.
Since the project was announced last October, the group has held workshops and roundtable discussions with a broad range of industry stakeholders. These include shippers, charterers, buyers, service providers, financial institutions, trade associations, industry standards and regulatory authorities.
By collaborating on critical issues such as security and data privacy, technology choices, business models, adoption strategies, and functionalities and capabilities, the group is ensuring that the new platform will meet the needs of the entire industry.
Next steps include development and execution, focusing on a pilot that will cover international bulk shipments of soybeans from Brazil to China.
The group is also finalizing the selection of technology solutions providers and partners.
