Dive Brief:
- Hapag-Lloyd and ONE have completed their integration with the TradeLens network, becoming the fifth and sixth largest carriers to do so, the companies announced last week. This comes two years after the carriers announced plans to sign onto the network.
- The companies had been piloting the technology to ensure that the platform was capable of receiving milestone data or bill of lading information and connecting it to the right shipment, according to Pyers Tucker, head of strategy at Hapag-Lloyd. Hapag-Lloyd's technical pilot involved nine shippers.
- "What now needs to happen is customers, shippers, consignees, need to get their heads around what this can actually do for them," Tucker said. "What this can actually do for their supply chain management, what this can actually do for their inventory, working capital, etc., etc."
Dive Insight:
TradeLens' goal to improve supply chain visibility has involved a years-long effort of persuading carriers to join the network. When carriers join, TradeLens gets their data, and the carriers gets free access to the blockchain-based platform. The data provided by the carriers is then meant to increase visibility across a shipper's supply chain.
"For shippers or consignees to be able to access this data, they need to sign a contract with TradeLens," Tucker said. "They need to pay per box that gets shipped and is made visible through the platform."
The addition of data from Hapag-Lloyd and ONE provides visibility into the fifth and sixth largest ocean fleets in the world, accounting for a combined capacity of more than 3 million TEUs, according to figures from Alphaliner. TradeLens was formed in 2018 by IBM and Maersk. Since then, multiple carriers have completed the same level of integration announced this week by ONE and Hapag-Lloyd, This includes Maersk, MSC and CMA CGM and eight other ocean carriers, according to TradeLens.
The platform has also been able to add terminal operators and railroads in its push to provide end-to-end visibility. It has also added inland ports and government customs agencies to its list of ecosystem partners, according to its website. Ten companies in China joined its network, including "two port groups and eight intermodal and inland logistics providers," according to an announcement.
Tucker said the platform will provide shippers with three milestones for their shipments:
- Planned: Shows a shipment time before booking is made with a schedule outline.
- Expected: Once booked, the shipment moves to an expected time.
- Actual: Once the event is complete it will show as an "actual" milestone.
The completion of the technical pilot means that Hapag-Lloyd's data has moved from the pilot environment (or sandbox) to the live operating environment, but it will take about another 10 months before it is able to provide all the milestone updates due to the process of connecting to the right APIs and figuring out the data management, Tucker said.
This kind of tracking "isn't actually that much different" from other visibility providers. What differentiates it is the scale and the ecosystem of other companies providing data, Tucker said.
The benefits become even greater when a buyer's suppliers are connected to the platform and they're able to see information on the shipments headed to them.
"It gives shippers visibility far earlier up their inbound supply chain than they would otherwise ever be able to get," Tucker said, providing an example of a coffee importer being able to see when beans leave a farm.
TradeLens notes that if a shipper's containers are moving through a terminal that is also connected to the TradeLens platform, the shipper will know when containers are discharged and "reduce the risk of containers being overlooked and racking up detention and demurrage costs."
But as TradeLens works to build out its network of data providers, shipper buy-in is still relatively small, according to Tucker.
"At the moment, there are about ... 60 or 70 customers that are shippers, consignees signed up to TradeLens," he said. "So we're actually still very much at the early days."
