Commodity traceability is a subject that needs very little introduction. It is the ability to verify where and how a product or shipment originated. Traceability has been a concern for many years and is a key part of the ESG debate.

Whilst sustainability is a vital consideration, and absolutely needs a strong traceability foundation to be successful, traceability can do far more for your business than just improving your ESG oversight. Improving traceability can improve your supply chain efficiency, and its resilience too.

Supply chain efficiency and resilience in commodities

Commodity logistics is all about creating efficient supply chains, and balancing this efficiency with the resilience to respond to disruptions. A more efficient supply chain reduces waste and downtime, as well as the person-hours to manage complex global logistics, which all leads to increased profitability.

And a resilient supply chain is one that can respond quickly to, and recover from, disruption. This means being prepared in advance for risks that can be predicted, mitigating known risk factors, and having the systems to respond quickly when unpredicted disruptions occur. This resilience allows commodity traders to maintain their continuity of operations from sourcing to logistics and end delivery.

Supply chain efficiency and resilience both rely on having the appropriate data at the right time – which is where traceability comes in.

Commodity traceability for supply chain efficiency

Commodity traceability is simply supply chain visibility. If you have traceability data for all your stock, you know where it is right now, all its quality data, and where it is sourced from. This visibility can create many opportunities to improve supply chain efficiency.

1.     Streamlined logistics

Efficient logistics in commodities offers more than a competitive advantage; it is frequently the life-blood of the organisation. Whether as a commodity merchant or procurement professionals serving internal clients, it allows businesses to reliably and cost-effectively meet client needs and deadlines.

Better data concerning where stock is coming from and future shipments allows your operators to streamline logistics by planning for the most effective ways to transport and transform stock. Your team can make the best use of storage and shipping resources, minimise journey times and fuel, and ensure quality metrics maximise the full value of every contract.

2.     Increased agility

Better traceability also increases agility by providing a complete view of all relevant data as your people need it, particularly if your commodity management system updates in real time. All the efficiencies mentioned above can be capitalised on even as the live situation changes if you have the right data to hand. For example, when a new sale contract is signed, operators can filter all unallocated stock in the most appropriate warehouses, check for incoming shipments, and make a decision straight away.

Risk managers and leadership teams also have the data they need to make faster strategic decisions based on traceability data. They can run what-if scenarios, create predictive models and dynamically optimise their operations. Whether that’s in limiting exposure to certain regions or counterparties, or identifying emerging markets/products, these decisions can only be made when the data is available and accessible.

3.     Faster responses with less manual input

Commodities traceability doesn’t just mean having the data on where stock originated. It is just as important to have this data in a readily-available and useable format. Improving your commodity traceability also means improving your data handling and processing so that the data can be used to full advantage.

These systems and processes should make traceability data easier to share, but also more usable, so that in any situation where your team is using commodity data, they can do so with minimal manual effort and no need to copy information between systems.

4.     Increased collaboration

Traceability requires organisations to collect more data from their suppliers and share more data with clients. It therefore provides new opportunities to work with supply chain partners to benefit all parties. Finding new ways to collaborate and innovate as an ecosystem provides more opportunities than innovating alone.

Commodity traceability for supply chain resilience

As with supply chain efficiency, improving access to traceability data can help improve supply chain resilience in multiple ways.

1.     Risk Mitigation

Your organisation can only act on potential risks if your people are aware of them. Better traceability means that the root cause of any issues can be identified faster. Stock and suppliers can be monitored in real-time. This makes it easier to manage the financial and reputational risks that can arise from poor supply chain practices.

The location data that forms part of the traceability picture can also be a vital resource in supply chain resilience. It helps your people quickly understand your exposure to certain regions and can be used to manage your response to disruptive events.

2.     Improved crisis response

Not all disruptive events can be planned for, and when they do occur, it is the organisations that have the best understanding of their data that are best placed to respond. For example, some traceability and commodity management systems allow you to integrate with live vessel tracking software so you know exactly where your shipments are even when they are at sea. This can be useful for rerouting shipments in the case of extreme weather events or other disruptions. For example, when the Suez Canal was blocked in 2021, the companies that lacked visibility and couldn’t reroute the ships carrying their cargo were hit hardest.

3.     Reduced Cost of Disruption

Responding to disruption faster can lessen its impact on your business, reducing the cost. And as mentioned above, good traceability systems can reduce the amount of manual processing in operations, which also reduces the human resource cost of dealing with disruption and lets your team get back to normal faster.

4.     Enhanced Business Continuity

If you can lessen the impact of a disruptive event on your business, there is a better chance that your people can continue to meet your usual client demand and get the business back to normal operations faster. Better business continuity places less demand on your team and can contribute to better client relationships and a corporate reputation for reliability.


Commodity traceability has benefits beyond the scope of ESG. Making data more visible and accessible can contribute to both supply chain efficiency and supply chain resilience. Both of these competences can have a major positive impact on your organisation. And improving your traceability processes means they can be improved whilst making your operations more efficient too.

Commodity traceability has a wide range of benefits and is something many organisations are working to improve. There are several different ways that technology can help improve traceability and provenance in commodities. To explore how you could improve traceability in your own organisation, get in touch with us for a no-obligation chat today.

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