The Covantis blockchain platform for post-trade processes has moved into full production, two years after being created by a group of major agribusinesses to digitalise agricultural shipping transactions.

It was announced last week that the platform had gone live with more than 30 entities, including its six founding members – Archer Daniels Midland (ADM), Bunge, Cargill, Cofco, Louis Dreyfus Company and Viterra.

The platform will initially cover bulk shipments of commodities such as corn and soybeans from Brazil to destinations globally, and will seek to connect shippers, traders and charterers involved in these trade flows.

In this initial market, the platform – which seeks to do away with paper-based post-trade processes, in a bid to boost efficiency and cut operational risks for bulk shipments of agricultural goods – will focus on digitalising core processes.

“We are beginning with digitalising the string management, the contractual notices and the overall communication between shippers, FOB [free-on-board] traders and charterers. The platform is being used for sending and receiving documentary instructions and draft documents,” a Covantis spokesperson tells GTR.

They add that the platform should cover the entire execution process later this year, and in line with this, the plan is to add firms who buy and sell on a cost and freight (CFR) basis onto the platform.

This will see Covantis cover the “end-to-end supply chain from shipper to CFR buyer”, they note.

Following this step, Covantis will then seek to bring in new post-trade processes, including trade confirmation, contract management, as well as laytime calculation.  

The Covantis spokesperson says that in terms of geographical expansion, the platform is currently exploring a number of markets, but notes “it’s highly likely the next origin markets… will be part of the Americas”.

In terms of branching out into other commodities, the spokesperson says that the platform will next look to cover the remaining grains and oilseeds, beyond the existing offering of corn and soybeans.

First created in 2018, Covantis established itself as an independent legal entity in March 2020 and brought in Petya Sechanova as CEO from Cargill. Two months prior to this, the platform announced that it would use Ethereum blockchain firm ConsenSys as its lead technology partner.

Guillaume Dechaux, global head of sales and business development at ConsenSys, notes in a statement on LinkedIn that going live “doesn’t mean a few transactions on the platform here and there”.

“It means that the platform is reliable and that all post-trade transactions from the founding members and the large number of adopters will go through the blockchain platform without parallel run,” he notes.

Covantis previously tested the platform in 2020, conducting a parallel run from early July to mid-August to gather feedback, with nearly 30 participants using a test version of the platform, and involving the transportation of 4 million tonnes of soybeans and corn.

The platform bears similarities to Vakt, another blockchain platform that uses Ethereum technology, which was launched by a group of oil majors, traders and banks to digitalise post-trade management processes in 2018.

Unlike Vakt and other blockchain platforms that have emerged in the commodities space of late, Covantis is yet to outline any plans for linking the platform to transaction financiers.