BHP Group, the world’s largest mining company, announced today that it has completed a $14 million iron ore trade with a blockchain platform developed by Canadian technology company MineHub Technologies.
The transaction took place between BHP and the China Baowu Steel Group. China Baowu Iron & Steel Group is a subsidiary of China Baoshan Iron & Steel Co., Ltd. (commonly known as Baosteel), the world’s largest steel producer.
China is the world’s largest importer of iron ore. After the COVID-19 pandemic, imports rose 11% in April this year. Production in domestic steel mills slowed earlier this year.
BHP Billiton issued an announcement about the transaction last month, saying it is planned to conduct blockchain-based iron ore trading with Baosteel.
According to a Reuters report, BHP Billiton used the blockchain platform during the transaction to digitally process contract terms, exchange documents and make the freight visible in real-time. The implementation of the blockchain by BHP Billiton is allegedly part of his plan, which aims to digitize the documentation process for goods transactions.
Michiel Hovers, Sales and Marketing Manager, BHP Billiton said:
“The bulk commodity industry needs a digital revolution to reduce physical documentation processes.”
BHP and Baowu Innovation with Blockchain
BHP Billiton and Baowu’s innovation in relation to blockchain Baowu has long invested in the use of blockchain technology to digitize retail. In May of this year, the company completed a blockchain-based RMB yuan transaction with Rio Tinto, another top mining group.
The history of BHP Billiton’s involvement in the blockchain space can be traced back to 2017 when Ethereum co-founder Vitalik Buterin Cointelegraph revealed to the company that it has decentralized natural resource tracking applications with a market value of $92 billion.
BHP’S High Interest in Blockchain
In February 2019, the mining giant successfully tested blockchain technology in collaboration with the Japanese shipping company NYK. This technology has enabled sustainable biofuels to be verified as part of the industry’s decarbonization efforts.
The company employs more than 72,000 people and contractors worldwide and has been researching the use of the Ethereum blockchain for many years.