DIBIZ Co-Founders Unnikrishnan R and Srinivasan Malarampath (R)
Palm oil is the world’s largest edible oil commodity. However, this industry still relies on manual practices and is not digital-ready, despite advancements in technology.
Besides this, palm oil industry stakeholders are often accused of ‘greenwashing’, a way of marketing a company/organisation to make it appear environmentally friendly.
Unnikrishnan R Unnithan and Srinivasan Malarampath, who together have 45-plus years of domain expertise, saw an opportunity to bring digitalisation to palm oil trading and prevent greenwashing.
Last month, they launched an online B2B marketplace for trading sustainable commodities in the supply chain, guaranteed through blockchain technology. The aim is to help last-mile farmers and small-time producers to embrace sustainability at a low cost.
DIBIZ, headquartered in Singapore, is starting with palm oil trading.
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“Many enterprises from developed countries demand proof from buyers and sellers (producers/traders) of CSPO (certified sustainable palm oil) to authenticate sustainability till the last mile (plantations and smallholders). This is where DIBIZ plays a role. Our marketplace lists products only from verified producers/traders of CSPO,” said COO Malarampath.
DIBIZ is not another blockchain network for users to upload delivery info for traceability, he claimed. It provides a whole suite of tools for improving productivity and reducing costs through supply chain collaboration. “Our marketplace covers not only producers, traders and manufacturers. But it also covers last-mile farmers and service providers like logistics companies, fintech/banks, inspection agencies and clearing and forwarding agents.”
The platform also offers a way to search and identify partners and conduct transactions with ideal trading partners through a single window. “For the first time, smallholders can participate at no cost and be visible to end buyers to get incentivised for producing sustainably,” Malarampath shared. “A multi-sided marketplace, we make visible approximately 3 million smallholders who produce 40 per cent of palm oil globally, yet only 2 per cent are certified sustainable”.
In addition to the marketplace, DIBIZ also provides many value-added technical features. They include digitalised workflow automation to improve productivity and efficiency of operations and real-time traceability and inventory tracking with IoT and geospatial analytics covering farmers.
The firm also ensures compliance with regulations for ethical sourcing and provides direct access to low-cost trade financing from banks/investors who support ESG-compliant supply chains.
The role of blockchain
According to Malarampath, blockchain provides data immutability for authenticating sustainability across the supply chain. The data from end-to-end of a supply chain is collated from different stakeholders and processors at different times and locations. Private and sensitive data is not shared on the distributed ledger.
“Every quantity of product on DIBIZ has immutable data to authenticate sustainability, conforming to many global standards, specifically NDPE (No Deforestation, Peat, and Exploitation),” he claimed.
The DIBIZ marketplace captures all aspects of the trade from RFQ (request for quotation) till the final GDN (goods delivery notice), digitises them and stores the cryptographic data on a secured blockchain. The proof of validating a trade is thus available on a blockchain.
Its algorithms connect the dots to produce traceability to the source of these cryptographic data on the blockchain. “Any enterprise at the last mile of the supply chain demanding ethically produced palm oil can thus purchase with confidence from our marketplace, which comes with satellite-based geospatial analytics for conformance to NDPE.”
Starting with Indonesia, Malaysia
DIBIZ primarily targets Indonesian and Malaysian markets, which account for nearly 85 per cent of the world’s palm oil production. The one-month-old startup, however, nurses an ambition to go global, as the GMV of sustainable palm oil alone is more than US$200 billion globally.
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“We’ve been undergoing successful pilots in Malaysia and Colombia. Commercial contracts are expected to be signed soon. Meanwhile, we are actively discussing with many industry associations for industry-wide adoption of our platform,” he said.
A bootstrapped company, DIBIZ recently raised funding from a few angel investors. The firm plans to rake in pre-series A funding for growth shortly.
Revenue model
Users pay a transaction fee for the value transacted through the platform. It also receives subscription charges for premium SaaS modules, which help stakeholders improve their productivity and efficiency of operations, providing faster ROI.
“Many ESG-focussed investment funds and reputed banks have mandated to finance only sustainable supply chains. Immutable data on sustainability provided by us can be a great asset for the customers to avail of such attractive green financing and save millions on interest rates. We believe this revenue stream from the trade financing commission will be the biggest potential in future,” he said.
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