Commodity inventory digitalisation is unlocking a multitude of real-time benefits for terminal operators, commodities traders, and lenders. This shift promises to make full transparency in inventory management and transaction flows the new normal. Currently, manual record-keeping and stale data are giving way to digital twin technology. Furthermore, this innovation addresses strict requirements for compliance and visibility. Consequently, it reduces risk and streamlines the customer experience for all parties involved.
Real-Time Visibility and Fraud Prevention
Digitalisation solutions developed for the commodities sector provide 24/7 visibility of inventory for every stakeholder. In addition, these tools offer automation for key processes. According to Shaik Razwan, Regional Head of Operations at Trafigura, terminals should provide real-time data so stakeholders have complete visibility. Importantly, commodity inventory digitalisation also minimises the risk of fraudulent behaviour, such as inventory theft and financial fraud. Therefore, it ensures an accurate coupling of physical versus financial flows, which has historically been a challenge for the industry.
Streamlining Operations with Veridapt Technology
However, driving these types of initiatives takes time and expertise that many smaller terminals may not have. David Thambiratnam, CEO of Veridapt Pty Ltd, notes that their proprietary technology provides highly accurate reconciliation data. Veridapt’s digital twin technology specifically automates everyday manual tasks like inspections and nominations. Moreover, their platform reconciles tank and pipeline matrices under a single platform by calculating volumes and reconciling them with actual measured tank levels. Thus, the solution eliminates the anxiety often caused by insufficient investment in terminal technology.
Strengthening the Digital Supply Chain Ecosystem
For leading lenders like Standard Chartered Bank, digitalisation supports a trusted international digital supply chain ecosystem. In a successful 2022 pilot, Standard Chartered, Trafigura, and Advario completed a live electronic oil inventory financing trade on Singapore’s SGTraDex platform. John Chen, Head of Commodity Sales at Standard Chartered, explains that greater transparency allows participants to gain better access to finance. As a result, market participants can possibly secure more favourable terms while the banking sector benefits from enhanced risk management.
Modernising Independent Storage Terminals
Even traditional brick-and-mortar businesses like Jurong Port Universal Terminal (JPUT) are now embracing software and digitalisation. JPUT CEO Loh Wei believes digitalisation helps solve issues related to financial risks and the inefficiencies of paper documents. Moving into a digitalised world provides confidence to banks and allows clients to seek credit financing efficiently. Although the transition takes effort, the goal for the industry is to achieve maximum transparency and collaboration across all parties. Finally, this transformation enables a touchless and fully transparent customer experience for the next generation.
Courtesy: tradefinanceglobal.com
