Agribusiness giants Cargill and Bunge have partnered to create a blockchain platform to manage the agriculture sector in Brazil, Coin Telegraph reported on 16 October.
The joint venture company Covantis would also involve the exchange of information of other major agribusiness companies including the French Louis Dreyfus Company, the Chinese state-owned Cofco International and the Dutch multinational Glencore Agriculture.
Together the companies that made up Covantis moved around 550M tonnes/year of grains and oilseeds, Coin Telegraph said.
The partnership’s aim was to use blockchain technology to unify the sector’s data and improve communication between all participants, which would lead, for example, to improved logistics processes.
Due to be launched in 2021, the first tests for the platform had been carried out at the Port of Santos between July and August this year involving 11 companies, Coin Telegraph said.
“Covantis should become the leader of operations in our sector and will be able to streamline processes, modernise and digitise them,” said Covantis CEO Petya Sechanova said.
Brazil was chosen for the launch of the platform due to the complexity of its market, Sechanova was quoted as saying to Valor. He said the country saw ‘chain sales’ or ‘string sales’ taking place, in which dozens of intermediaries needed to act for the shipments to take place, even though only final buyers and senders had contact with the physical shipment.
Traditionally, the process was managed by a combination of using email, phone and WhatsApp. However, the new Covantis platform would use blockchain technology to circulate all the information.
The company’s ambition was to gradually bring together all the grains and oilseeds shipments in bulk from its founding companies worldwide, Sechanova was reported as saying.
Covantis was planning to launch its blockchain solution in Argentina and the USA next, Coin Telegraph said.