A large percentage of the commodities traded worldwide today are transported via maritime shipping.

The EU estimates that in 2016, maritime transport accounted for more than half of all goods imported into the region.

In 2018 alone, cargo ships carried nearly 10.7 billion tons, and according to the World Trade Organization, shipping accounts for 85% of all international trade.

For a business that plays such an outsized role in the global economy, it is only natural that the shipping industry is intensely fixated on improving its efficiency.

From expediting the way legal processes are executed to repairing the ships themselves, technology is quickly advancing the way we ship commodities:

1. Blockchain Simplifies the Chain of Custody

In maritime shipping, the chain of custody — which entity owns and is liable for the goods being shipped at each point throughout the chain — is essential to ensure goods get from port to port securely. Even so, this crucial process is still largely handled on paper. Bills of lading and other vital documents must be delivered by hand at every step, creating myriad potential complications while slowing down the entire supply chain.

New technology-based solutions to this problem are employing blockchain to both digitize and update how the chain of custody functions. Companies like the Brisbane-based CommChain offer full-stack solutions that handle chain of custody using blockchain’s distributed ledger to track the progress of a shipment. Using blockchain, bills of lading and other documents are sent digitally, creating savings both economically (reduced courier and paper costs) and operationally (fewer delays and instant transfers of custody).

“We are quickly becoming the first fully independent service provider to provide bulk commodities trading with a verified and immutable platform for global trades of Iron Ore Coal, Copper, Potash and other bulk commodities,” said Gary Zamel, founder and chairman of CommChain.

Zamel has a history of start-ups in mining operations, trading and technology companies over the last 30+years, having spent his career as a mining engineer building global companies.

Blockchain adds layers of transparency and security. Immutable ledgers mean anyone on the supply chain can verify ownership at any point in time, leading to fewer opportunities for fraud and theft. Already, major shipping companies like Maersk have started using blockchain along their supply chain, and the technology is increasingly being embraced across the industry.

2. Cloud Technology Makes Companies More Efficient

One of the bigger logistical challenges facing the global shipping industry is its massive scope. Most shipping companies are based in one country, but have offices and staff in tens of others, as well as agents in hundreds of ports and ships crisscrossing the globe. One major issue with this spread-out model is that data is not always available at the most crucial times.

Cloud technology improves companies’ abilities to visualize and communicate data in real-time, leading to better shipping routes, reduced fuel and operational costs, and upgraded supply chains overall. For instance, the United Arab Shipping Co. switched to a cloud-based fuel management infrastructure for its fleet of over 70 ships and consequently discovered better fuel prices in real-time capable of delivering an estimated 3% to 5% reduction in fuel costs. More importantly, cloud communications grant ships access to real data while concurrently empowering companies to engage in smarter decision-making regarding their supply chains.

3. IoT Improves Logistics and Supply Chains

In connection with the cloud, the Internet of Things represents a major development for international shipping. Most present-day inventory tracking is still performed manually, even if technology is incorporated in the process. It is common for workers to scan codes on containers at every port, but it still requires manual labor. By deploying smaller sensors and microcomputers, companies can automate large portions of the chain of custody. Most crucially, this reduces both labor costs and regulatory compliance costs as well, since shipments can be tracked more accurately from port to port.

IoT is not just a pipe-dream either—it is already being implemented across the industry at a surprising pace. A survey by Inmarsat (a satellite communications firm) found that 65% of maritime shipping companies already deployed IoT in some capacity, with the sector forecast to spend roughly $2.5 million on IoT-related solutions per business over the next three years.

4. Analytics Streamlines Operations

Big data is one of the hottest trends in technology, as artificial intelligence and rapid processing encourage real-time analytics across industries. For maritime shipping, analytics delivers several advantages to ship owners and ships themselves. The emergence of predictive analytics, for instance, can help ships chart better courses by tracking areas where delays commonly occur, as well as weather formations that may slow journeys.

On a more micro scale, analytics improve vessel operations by tracking a variety of data. This includes areas like terminal and berth allocation, as well as monitoring engines, moving parts, and other key aspects of ship upkeep that can be problematic. Additionally, big data can help advance the cargo handling and transfer process, collecting data on cranes and other vehicles to uncover bottlenecks, inefficiencies, and determine the general status of equipment.

5. Automated Ships Bring About Safer Voyages

Though this form of technology is not technically operational yet, it is already being discussed as a near-term solution. There has been a broader push across the technology industry to improve autonomous and driverless vehicle technology, with technology representing an ideal fit for the maritime shipping industry. Studies have found that automated vessels do result in savings. Some research has found that total transport costs, especially on smaller container ships, could be as big as 10% to 22% (roughly the equivalent of a 50% savings in fuel consumption).

Several companies are already on the verge of introducing these revolutionary vessels. Rolls Royce announced that it plans to have sea-worthy autonomous ships in transit by 2025, while shipbuilders Kongsberg and Yara are planning to have a zero-emissions autonomous ship in operation by 2020.

Shipping is one of the pillars of the global economy and has relied on outdated technology for far too long. These technologies should radically change the way the industry works, and result in faster shipping, better results, and a more streamlined global commodities industry.

Jim Hoffer is founder and managing director at Hoffer Financial Consulting. Follow him on Twitter.