Four of the world’s largest metals and mining companies have thrown their weight behind a new initiative by the Baltic and International Maritime Council (Bimco) to boost adoption of the electronic bill of lading (eBL).
The Bimco 25 by 25 pledge, launched today and signed by Anglo American, BHP, Rio Tinto and Vale, commits bulk shippers to achieve eBL usage for 25% of their annual seaborne trade volume for at least one commodity by 2025.
“As the largest dry bulk shipper in the world, one of our ambitions has been to continuously improve the experience of doing business with Rio Tinto for our customers and supply chain through innovative end-to-end digital solutions, says Laure Baratgin, head of commercial operations at Rio Tinto. “We fully support the 25 by 25 pledge on the use of electronic bills of lading – as a key step in enabling faster, more secure and traceable trade flows, and bringing the industry closer to a full digital trade future.”
Bimco says the move marks a “significant step forward” in accelerating trade digitalisation and streamlining supply chain processes in the bulk sector.
“These are shippers of huge volumes of raw materials – these four companies alone ship around a billion tonnes of iron ore every year,” Grant Hunter, Bimco’s director of standards, innovation and research tells GTR.
“This is a very large volume of very high value cargo, and we have a very inefficient practice where the paper bill of lading (BL) isn’t arriving at the discharge port and people are having to accept letters of indemnity,” he adds. “We can resolve all of that right now with the systems we’ve got, and these mining companies have already made inroads into getting more and more cargo on electronic bills of lading.”
As well as the risks inherent in the issuance of letters of indemnity when cargo arrives at discharge ports before the paper BL, the relative ease with which paper BLs can be tampered with or falsified has been a central theme in some of the most egregious commodities fraud cases of recent years.
In contrast, switching to eBLs increases efficiency, reduces costs and improves the overall transparency and security of trade, cutting down on unnecessary legal and commercial risks.
With this commitment, the four mining firms will likely use their market-making heft to encourage other stakeholders within the metals and mining supply chain to take up the eBL.
“By signing the pledge, we are reaffirming our dedication to advancing our digitalisation process and inviting our customers and partners to join us on this exciting journey that benefits the entire supply chain,” says Erick Tavares, sales administration manager at Vale.
“We are committed to supporting the digital transformation in the shipping industry together with our supply chain partners. We are pleased to be a signatory to the 25 by 25 pledge and hope others will join with us to support the acceleration of trade digitalisation and streamlining of the supply chain process,” adds Hui Ling Chan, vice president of BHP’s order-to-cash global business services.
Bimco is working to bring in more signatories to the pledge, and has so far gained the support of owners and operators including Cosco Shipping Bulk, Oldendorff Carriers and Star Bulk.
“As a shipowner and operator, we are fully supportive of the 25 by 25 pledge and accelerating the shift towards electronic bills of lading,” says Julius Posselt, head of operations-claims department at Oldendorff Carriers. “We will be encouraging our counterparts to adopt eBLs and join the pledge as it will ultimately benefit everyone in the supply chain.”
The Bimco 25 by 25 pledge comes on the heels of a similar initiative by fellow FIT Alliance member the Digital Container Shipping Association, which last month published a commitment by its nine ocean carrier members to fully adopt the eBL by 2030.