Digital Assets: MineHub Processes The First Iron Ore Transaction on the Blockchain Between BHP and China Baowu
The iron ore transaction was worth $14 million and delivered in June.
Privately held MineHub Technologies said BHP (ASX: BHP) and China Baowu had completed their first iron ore trade on its blockchain-based platform.
The transaction will be a precursor to many more such commodity transactions. They would participate in a supply chain that would be fully digital from end-to-end. (MineHub)
Digitizing the commodity supply chain
Arnoud Star Busmann, CEO of MineHub said, “Working with the world’s largest mining company and the world’s largest steel producer on designing the digital future of critical supply chains like iron ore is incredibly exciting.”
“This series of transactions, each focusing on different aspects of the post-trade process, will allow MineHub to incrementally expand the platform’s functionality and scalability into the iron ore and other mineral commodity markets, incorporating real-life user experience.”
MineHub’s blockchain platform connects buyers, sellers, and service providers in mining and metals supply chains. Any transaction, from mine to market, generates a costly and cumbersome paper trail. However, the blockchain transforms it into a secure and digital hub. The hub provides real-time collaboration, communication, and notification to all parties. It creates a real-time, continuous “line-of-sight” to the transaction, the commodity, logistics, and settlement.
“The bulk commodity industry needs a digital revolution to reduce physical documentation processes,” said BHP sales and marketing officer Michiel Hovers.
“We will incorporate all these learnings into the next MineHub release, planned for Q4 2020. It will start to provide a solution to the increasingly urgent need for industry-wide digitalization, by boosting both safety, transparency, and resilience of critical supply chains,” said Busmann.
“Especially as current pandemic events and fraud cases in the commodity trading industry are causing a step-change in the adoption of digital solutions,” he added.
According to BHP, the $14 million transaction in iron ore was delivered in June and routed on the blockchain. The platform processed contract terms, exchanged digital documents, and provided real-time cargo visibility.
Last month, a subsidiary of China Baowu Steel Group completed its first yuan-denominated cross-border settlement on the blockchain. Valued about USD14.1 million, it was concluded with an Australian unit of global mining giant Rio Tinto (ASX: RIO).
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