Applications and Use Cases

IBM Partners with Others for Blockchain Pilot Program

March 06, 2019

IBM along with Ford Motor Company, Huayou Cobalt, LG Chem and RCS Global plan to use blockchain technology to trace and validate ethically sourced minerals. These companies support human rights and environmental protection while helping to infuse more transparency into global mineral supply chains.

The group began with a pilot program, which focused on cobalt and explored the creation of an open, industry-wide blockchain platform that could be used to trace and validate a range of minerals used in consumer products. The group is compromised of participants at each major stage of the supply chain from mine to end-user.

"We remain committed to transparency across our global supply chain," said Lisa Drake, VP, global purchasing and powertrain operations, Ford Motor Company. "By collaborating with other leading industries in this network, our intent is to use state-of-the-art technology to ensure materials produced for our vehicles will help meet our commitment to protecting human rights and the environment."

Going forward, the program will demonstrate how materials in the supply chain are responsibly produced, traded and processed. The pilot program is based on a simulated sourcing scenario.

Cobalt produced at Huayou's industrial mine site in the Democratic Republic of Congo (DRC) will be traced through the supply chain as it travels from mine and smelter to LG Chem's cathode plant and battery plant in South Korea. Then it will be delivered to a Ford plant in the United States. An immutable audit trail will be created on the blockchain. The audit trail will include corresponding data to provide evidence of the cobalt production from mine to end manufacturer.

"As a leading global battery material provider, we are proud to have an OECD Due Diligence Program and active community support initiatives in place linked to our operations in the DRC. This is central to our proactive approach to delivering ethical cobalt. We also want to have strong, reliable information channels to prove and demonstrate this action to our customers. This blockchain pilot is an interesting and potentially important next step in these efforts. We believe in transparency and a collaborative approach to improving production conditions in the DRC cobalt sector, leveraging the project to this end has huge potential," said Chen Hongliang, CEO, Huayou Cobalt.

While the initial focus is on large-scale miners (LSMs), an important objective of the group is to assist in increasing  transparency in artisanal and small-scale mining (ASMs). This will enable these operators to sell their raw materials in the global market, while they meet their internationally ratified responsibility requirements. The network can help enable ASM operators to partner with due diligence data providers and join a blockchain-based network of validated participants. The pilot program will also explore the use of incentives or financial benefits for ASMs and their local communities impacted by mining.

These companies foresee this pilot to be completed mid-year 2019.

Chrissie Cluney has been a correspondent for IoT Evolution World since 2015. She holds a degree in English with a concentration in writing from the College of Saint Elizabeth.

Edited by Ken Briodagh



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