Volkswagen joins blockchain for cobalt supply
Volkswagen has joined an industry initiative for responsible purchasing of strategic minerals, especially cobalt. Blockchain technology is to help to improve efficiency, sustainability and transparency in global and complex supply chains.
The cooperation gives members of the responsible sourcing network a better insight into the origin of cobalt, which is in high demand for its use in lithium-ion batteries that power electric vehicles among other devices. According to a report from Morgan Stanley, demand for cobalt is expected to multiply eightfold by 2026. Currently, a typical electric car battery requires around 9 kg of cobalt, while the average laptop requires about 28 grams of the mineral.
The blockchain group was formed in January of this year and intended to run a pilot built on the IBM Blockchain Platform and powered by the Linux Foundation’s Hyperledger Fabric. Blockchain technology is used to trace and validate ethically sourced minerals, making it possible to detect the origin of minerals while being transparent for all companies in the supply chain. The RCS Global Group has validated the network for compliance with responsible sourcing standards such as those set by the OECD. Members can access and supplement “secure and unalterable data” to track and record mineral pathways in near real time.
Volkswagen will be joining the ranks of companies such as Ford Motor Company, Huayou Cobalt, IBM, LG Chem and RCS Global. Moreover, the blockchain network includes not only end users but also mines and other production partners along the way.
The pilot will end by the middle of this year after which supply chain networks will be encouraged to join the initiative. The platform is built to allow interested parties of all sizes and roles in the supply chain. Also, the operators expect to extend the Blockchain beyond cobalt into other battery metals and raw materials, as well as rare earth.
Additional reporting by Nora Manthey.
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