Casting the Foundations of Steel Digital Trade Using Verifiable Credentials

Kritzia Rust
June 13, 2022

Like in many other supply chain-based industries, efficiency and proof of origination in the steel industry is heavily reliant on information sharing across that value chain. The reality today tends to be that organizations adjacent to each other in a supply chain tend to exchange information, but this information does not travel downstream with the product itself, partly due to lack of digitization and partly due to misalignment of end-to-end data standards to share this information. In short, there is a lack of “interoperability”. In order to solve this challenge and enable multi-vendor supply chain visibility, proof of origination, and even more “programmable supply chains” an emerging standard based on Verifiable Credentials (VC) and Decentralized identifiers (DID) developed in the W3C is arising. To show the potential of interoperability and its impact in the context of steel supply chains three companies using completely different technology stacks, Transmute, Credivera, and Mavennet conducted an interoperability demonstration using the above-mentioned standards as part of a Canadian Federal government Pilot sponsored by ISED to help digitize the Canadian steel industry. In the following, we are providing context about the current challenges, highlights about the standards, an overview of the cross-border scenario that was used for the interoperability demonstration, and a video of the demonstration itself.

Credivera, Mavennet and Transmute multi-tech crossborder interoperability showcase

Despite the predicted growth of the global steel market — said to reach $1 trillion by 2025 — the industry faces big challenges that have yet to be efficiently addressed. The steel industry often finds itself dealing with concerns of origination and transshipment claims, information silos, and sustainability that we felt could be addressed with the adoption of a new solution. These challenges are not exclusive to the steel industry and finding a solution to these issues is key to finding a way to advance supply chain management.

There is a new trend in the industry that points towards the digitization of supply chain management. Interoperability is one way to address the issues facing the steel industry. If implemented correctly, this will break down information silos and make the supply chain more flexible, efficient, secure, and transparent. In an effort to do so, we chose to align building on W3C Verifiable Credentials and Decentralized Identifiers — in doing so, enabling interoperability between organizations with a high degree of security and efficiency. Under the sponsorship of ISED (Government of Canada), we held an interoperability plugfest, that various organizations that utilize different underlying technologies participated in. Those organizations were Transmute, which is a vendor to the US DHS and US CBP, working on the instant verification of credentials, Credivera, which is an identity provider for employees, and Mavennet, a contractor to the Federal government of Canada for the digitization and improvement of the Canadian steel value chain.

The above diagram depicts the scenario that was used to conduct the test– it shows the process of a cross-border supply chain in which the steel moves from supplier to buyer. Instead of a hard copy mill test report (MTR), the MTR is submitted and passed along on the blockchain. When the report is sent by the supplier, and received by Canadian Steel co., the report is verified by them and then passed on to the broker, who reviews and submits the MTR to the Canadian Border Security Agency. The CBSA also reviews the documents received and once again, verifies the information, before accepting the product. When the documents are released, Canadian Steel co. moves onto the next step of the process, smelting the steel into hot rolled steel coils. They then issue another MTR and share it with Inspector co. An inspector is hired by Inspector co. to review the documents but first, their employee identity is authenticated, and then they go on to issue the inspection and verify the MTR. Canadian Steel co. passes all their verified documents — the MTRs and inspection report — to their customer, an American-based steel fabricator who checks the documentation and submits the import entry. The Customs and Border Patrol checks the data received, after the employee’s identity is certified, and then verifies the whole process.

The actual interoperability demonstration can be seen here:

The interoperability demonstrated in this scenario was only one-use case, but obviously, the design is made to be flexible to support virtually any scenario that could potentially happen in the industry. This approach to supply chain is not limited to the steel industry and there are other initiatives using these standards for agricultural goods, oil and gas, and eCommerce. Please refer to the traceability vocabulary for more information and to join forces with us to expand the scope of interoperable industries.

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