How seven parties came together to provide one innovative solution for one of the world’s leading dairy processors
Seven parties. One solution. A first for New Zealand.
When Fonterra, one of the world’s leading dairy processors, wanted to carry out their first Electronic Bill of Lading (eBL) for a shipment of milk powder from New Zealand to Sichuan Province, HSBC had the global network and strong presence in China they needed to pull it off. The end-to-end electronic presentation of trade documents was completed in 1-3 days, compared to the traditional time of 7-10 days using paper-based documentation and couriers.
About the client
Fonterra Co-operative Group is one of the world's leading dairy processors, owner of a significant portfolio of brands in Asia-Pacific, and a partner to many of the world's leading food companies. Fonterra is headquartered in New Zealand, with offices in more than 40 countries around the world.
Breaking new ground with Blockchain
Covid-19 has posed logistical challenges for companies around the world, and Fonterra was keen to achieve greater efficiency by piloting this digital solution – the first of its kind in New Zealand.
The Bill of Lading is one of the most important legal documents in an international trade as it represents the ownership of the cargo contents. As one of the world’s largest exporters of dairy products, Fonterra deals with thousands of Bills of Lading each year. Present from origin to destination, it’s essential to the ownership of cargo, customs clearance and finance, and serves as a shipment receipt when the goods reach their final destination. Under normal paper-based circumstances it can take more than a week for a physical Bill of Lading to travel from origin to destination, changing hands many times in the process, leaving it open to delays or fraud.
By digitising this workflow, Fonterra were keen to maximise operational efficiency and deliver the goods more optimally by:
- Reducing the end-to-end turnaround time from 7-10 days to 1-3 days
- Decreasing documentation processing costs
- Eliminating manual processes to minimise the risk of document loss, human error, forgery or delay
- Gaining greater visibility and real-time oversight over their trade transaction.
A turning point for trade
HSBC was well-placed to lead this transaction – the first Blockchain trade transaction between the two countries - given its international network, digital capabilities and ability to offer banking services on both ends.