First Iron Ore Trade Using CargoDocs Electronic Bills of Lading
BHP Billiton, Royal Bank of Scotland, Westpac Banking Corporation, Cargill and Minerva Marine recently completed the first trade financed iron ore trade using ESS’s CargoDocs electronic bill of lading and eUCP Presentation solutions. CargoDocs was used on a shipment from Australia to China.
In this trade the electronic bill of lading was drafted by BHP Billiton in Shanghai (eliminating the need for separate document instructions). It was then approved signed and issued on behalf of Minerva Marine by Wilhelmsen Ships Services in Port Hedland, Australia. BHP Billiton created original electronic peripheral documents within CargoDocs and the whole eSet was endorsed and presented electronically to RBS under an eUCP600 letter of credit. Once accepted, the eDocs were transferred to Westpac electronically, after which they were forwarded to the buyers, Cargill.
The times taken by the parties demonstrate the attractions of using eDocs. The eB/L was drafted, approved, signed and issued, and the full eDocs set was presented to RBS, the confirming bank, all within one hour. RBS presented the eDocs to Westpac Banking Corporation in Singapore, the Issuing Bank, the next working day. Westpac passed eDocs to the buyer Cargill, completing this four corner presentation within just four days. 100% of documents required under the letter of credit were presented as original electronic documents.
This shipment was one of a series of six carried out in quick succession using electronic bills of lading and eUCP Presentations over a period of a fortnight.
The shipment was one of the first use of CargoDocs electronic bills of lading in iron trades, the first live use of CargoDocs by BHP Billiton as well as the first use of eUCP Presentation using CargoDocs by RBS and Westpac. Both banks went from an oral agreement to move forward to the live shipment in less than 16 weeks.
Nadeem Ashraf, Trade Execution Lead, Cargill Singapore said “At Cargill, we are committed to innovation that creates value for our customers and partners and for us. We are delighted that ESS has supported us in creating a web-technology to simplify our processes around management of shipping documents. The use of these tools offers better customer experiences”
Manfred Schmoelz, Head of Transaction Services, Asia Pacific, for The Royal Bank of Scotland said, "As one of the leading global trade banks, RBS is focused on providing innovative trade solutions to our clients by supporting their needs with both our proprietary trade systems, as well as delivering bank-agnostic electronic platforms such as ESS. This is one of several industry 'first' trade transactions RBS has successfully executed with the electronic presentation of documents and we are indeed proud to have been able to help our long-term clients, BHP Billiton and Cargill, in this landmark trade."
Manoj Menon, Global Head of Trade Services, Innovation & Customer Proposition, RBS, went on to say “Transferring the document electronically means this can all happen in minutes instead of days and the goods are released much sooner. eB/Ls are already proving very popular in the oil and bulk commodity sectors. Banks can already provide their own electronic banking services, but this may not be sustainable in the long term. Independent, multi-bank platforms are the way ahead for bringing benefits across international trade as evidenced here with ESS.“
Axel Boye-Moller, Head of Westpac Asia's Global Transactional Services said, "As a leading trade partner in Australasia, Westpac is well placed to work with key customers BHP Billiton and Cargill Group along with ESS to deliver this leading edge solution. With the increasing growth in global trade, we continue to support our customers with innovative solutions that deliver greater efficiency and speed across geographies.
Capt. Yannis Giannopulos, Operations Manager, Minerva Marine Inc. said, "We are fully committed to the commercially successful transportation of our client's cargo around the world and the adoption of eDocs to improve our operations efficiency by speeding up the documentation process. We do believe that a move from the traditional paper bill of lading to a secure electronic format is the future of shipping documentation, having numerous advantages for the industry. We are excited to be associated with this important development as provided by ESS CargoDocs solutions which is an easy functional, traceable, and user- friendly process.”