Case study: Commodity Trading 1.0 vs 2.0

Electronic Transferable Records (ETRs) in practice: letters of credit and transport documents (eBL). The parties below are illustrative.

The legacy scenario (1.0)

Terra Commodities International (TCI), a fictional Swiss-domiciled soft-commodity trader, sources, buys, stores, and distributes agricultural commodities. Pinoy Import Trade needs a letter of credit to import a cargo of wheat from the United States into the Philippines, both to meet regulations and to finance the transaction. Traditionally this has been a time-consuming, paper-based, manual process:

First, TCI’s bank in Geneva — Celestial Commerce Bank (CCB) — receives an original bill of lading (OBL) by courier from the carrier, Neptune Cargo Lines. The OBL must be packaged with the commercial invoice, packing list, certificate of origin, and certificate of analysis. CCB’s staff check the paperwork against the terms of the letter of credit and courier it to the buyer’s bank, Manila International Bank (MIB). MIB reviews the documents and, if everything is in order, forwards them to the importer, who surrenders the OBL to the carrier to release the cargo. If either bank finds an error, the package is couriered back to TCI for correction and resubmission.

This document movement can take 17–28 days. When the cargo finally arrives, the importer is often unable to hand over the OBL because the paperwork has not cleared — triggering detention and demurrage costs, inventory problems, and lost sales.

Scenario 2.0 — with Electronic Transferable Records

Neptune Cargo Lines, TCI’s preferred carrier, proposed digitising the documents and workflow with Post-Trade, by Havona. Neptune issued the original bill of lading digitally as an electronic bill of lading (eBL) using the DCSA transport-document data model, and TCI received it securely through the Havona platform, which facilitates a compliant transfer of the electronic transferable record between the two parties.

The packing list was created dynamically during the contract flow between TCI and its grain supplier in the United States. Once the agreements between TCI and its Philippines counterpart were digitally signed and recorded on the Canton institutional ledger, the packing list was electronically transferred by TCI to Neptune Cargo Lines, who issued the eBL alongside the DCSA-compliant transport documents.

The commercial invoice, packing list, and electronic certificate of origin already resided on the Havona platform, having been formed during the collaboration between TCI and its counterpart; the certificate of analysis was uploaded and cryptographically sealed in the Havona ETR Vault for safekeeping and version control. The eBL and trade documents were shared with TCI and CCB for review, then compared by CCB and MIB. Both banks communicated securely through the platform, which records each change on the Canton ledger. When both banks were satisfied, they submitted their cryptographic signatures to move the trade to the next phase.

Finally, TCI transferred title by submitting the eBL to the shipping company, which released the goods and transferred title to the buyer and their bank once the performance of the trade contract had been sufficiently exercised through the Digital Trade Transaction (DTT) rules engine. Access to the records is transferred in seconds at each stage, while remaining under the control of the appropriate authorised party.

The outcome

Detention and demurrage fees were no longer a concern, and there was less risk of stock-outs or revenue delays from late paperwork. The streamlined documentation process removed days of couriering and manual checking, helping ensure on-time cargo release, and document revisions could be made securely — with a clear audit trail — in minutes rather than days. The deal closed quickly, painlessly, and entirely digitally, with the banking and shipping document flows synchronised on the Havona platform.

Havona presents and transfers the documents; funds settle on the banks’ own rails. Nothing in this flow moves money through Havona.