Mining giant BHP Group has completed the first cross-border copper concentrate trial shipment transaction with metal trading firm China Minmetals leveraging blockchain technology through the MineHub platform.
A press statement by MineHub failed to disclose the shipment’s destination but noted that there are plans to expand the solution further in early 2022.
The $30 million transactions entailed the performance of contract terms, payment notifications, digital document exchange, chemical assay exchange, and carbon emissions data sharing.
Notably, the information transfer between the two parties depends primarily on e-mail and paper transmission. Furthermore, the solution incorporates institutions such as banks, commercial institutions, logistics providers, and government departments.
According to MineHub, the transaction aligns with the growing volume of traded copper concentrate, with China emerging as one of the largest markets. Therefore, the growth requires market participants to rely on a safe, stable, efficient, and real-time data sharing system platform.
Solving key pain points
MineHub notes that the deployment of blockchain seeks to solve pain points in the settlement process of copper concentrates. The company highlighted challenges such as high processing costs, complex pricing mechanisms, and vulnerability to errors and fraud.
“The pilot digitized the assay exchange process – used to determine the quality of the concentrate – to improve efficiency and transparency in what is known to be one of the most complex and sensitive processes in international bulk commodity transactions,” she said in a blog posted on the company’s website,” said BHP chief commercial officer Vandita Pant
MineHub CEO Arnoud Star Busmann acknowledged that the solution’s design is a continuous journey that will determine the company’s success.
According to the company, the emergence of blockchain technology has forced entities in various commodity groups to digitize the sector that is highly reliant on paperwork.
The transaction comes after BHP leveraged the MineHub platform for its first blockchain-based iron ore trade with China Baoshan in June 2020.