The ethical sourcing of minerals in the supply of the global mineral industry would be ensured by the use of blockchain technology to be put in place by a consortium of companies led by IBM and includes Ford Motor, Huayou Cobalt, LG Chem, and RCS Global.
The concept of “blood diamonds” and conflict minerals is nothing new where human rights violated and wars are fuelled by the revenues generated from mining. This consortium aims to take up measures so that such uses of the revenues are reduced or eliminated by bringing in transparency and security inherent in the ledgers used in blockchains. The technology can be put to use to ascertain the uniqueness of an item like a diamond or a lithium mineral and allow companies to keep a complete track of the shipment of such materials starting from a mine or a quarry to the distribution and the fiend customer.
Very investments have already made by IBM in development of various forms of blockchain technology. For example, a blockchain to bring down shipping costs has been designed by the IT firm with the shipping giant Maersk. It has also partnered with Seagate to bring down counterfeiting of hard drives, and with Hu-manity.co to protect user privacy. Further, increasing of operational efficiencies, logistics, financing, and reducing costs in high-value mineral supply chains – right, from the mine to the buyer, is also being done by Kutcho Copper spin-out MineHub Technologies. IBM also has undergoing projects with the likes of Goldcorp, ING, Kutcho Copper, Ocean Partners USA, and Wheaton Precious Metals
Tracing and ascertaining the validity of minerals and other materials for the automotive and consumer electronics industries through the creation of an open, industry-wide network is the aim of this blockchain coalition. Responsible sourcing of industrially mined cobalt would be the first project of this consortium.
Lithium-ion batteries is at the heart of power providing systems for large number of products such as laptops, mobile devices, and electric vehicles and cobalt is a very critical component of the batteries and therefore in high demand. A recent report published by Morgan Stanley estimates that the demand for cobalt is to increase by eight folds by 2026 – driven mainly by rising demand for electric vehicles and consumer devices. Among these, electric vehicles require far more powerful lithium-ion batteries than required for other goods where each typical electric car battery requires about 20 pounds of cobalt while a standard battery for a laptop requires only about one ounce of cobalt.
The development of a pilot project for the blockchain is almost completed and it this aims to show how it is possible to responsibly produce, trade, and process all of the materials in the supply chain. On a simulated sourcing scenario, this blockchian pilot project shows how it is possible to trace the movement cobalt that is mined at Huayou’s industrial mine site in the Democratic Republic of Congo till it reaches Ford plant in the United States having passed through the supply chain from Congo to foundries at LG Chem’s cathode plant and battery plant in South Korea. The block chain creates an immutable audit trail where matching data evidences how the mined cobalt reaches the end consumer.
“With the growing demand for cobalt, this group has come together with clear objectives to illustrate how blockchain can be used for greater assurance around social and environmental sustainability in the mining supply chain,” said Manish Chawla, general manager of global industry products industry at IBM, in a statement. “The initial work by these organizations will be used as a precedent for the rest of the industry to be further extended to help ensure transparency around the materials going into our consumer goods.”
(Adapted from VentureBeat.com)
The concept of “blood diamonds” and conflict minerals is nothing new where human rights violated and wars are fuelled by the revenues generated from mining. This consortium aims to take up measures so that such uses of the revenues are reduced or eliminated by bringing in transparency and security inherent in the ledgers used in blockchains. The technology can be put to use to ascertain the uniqueness of an item like a diamond or a lithium mineral and allow companies to keep a complete track of the shipment of such materials starting from a mine or a quarry to the distribution and the fiend customer.
Very investments have already made by IBM in development of various forms of blockchain technology. For example, a blockchain to bring down shipping costs has been designed by the IT firm with the shipping giant Maersk. It has also partnered with Seagate to bring down counterfeiting of hard drives, and with Hu-manity.co to protect user privacy. Further, increasing of operational efficiencies, logistics, financing, and reducing costs in high-value mineral supply chains – right, from the mine to the buyer, is also being done by Kutcho Copper spin-out MineHub Technologies. IBM also has undergoing projects with the likes of Goldcorp, ING, Kutcho Copper, Ocean Partners USA, and Wheaton Precious Metals
Tracing and ascertaining the validity of minerals and other materials for the automotive and consumer electronics industries through the creation of an open, industry-wide network is the aim of this blockchain coalition. Responsible sourcing of industrially mined cobalt would be the first project of this consortium.
Lithium-ion batteries is at the heart of power providing systems for large number of products such as laptops, mobile devices, and electric vehicles and cobalt is a very critical component of the batteries and therefore in high demand. A recent report published by Morgan Stanley estimates that the demand for cobalt is to increase by eight folds by 2026 – driven mainly by rising demand for electric vehicles and consumer devices. Among these, electric vehicles require far more powerful lithium-ion batteries than required for other goods where each typical electric car battery requires about 20 pounds of cobalt while a standard battery for a laptop requires only about one ounce of cobalt.
The development of a pilot project for the blockchain is almost completed and it this aims to show how it is possible to responsibly produce, trade, and process all of the materials in the supply chain. On a simulated sourcing scenario, this blockchian pilot project shows how it is possible to trace the movement cobalt that is mined at Huayou’s industrial mine site in the Democratic Republic of Congo till it reaches Ford plant in the United States having passed through the supply chain from Congo to foundries at LG Chem’s cathode plant and battery plant in South Korea. The block chain creates an immutable audit trail where matching data evidences how the mined cobalt reaches the end consumer.
“With the growing demand for cobalt, this group has come together with clear objectives to illustrate how blockchain can be used for greater assurance around social and environmental sustainability in the mining supply chain,” said Manish Chawla, general manager of global industry products industry at IBM, in a statement. “The initial work by these organizations will be used as a precedent for the rest of the industry to be further extended to help ensure transparency around the materials going into our consumer goods.”
(Adapted from VentureBeat.com)