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PRICE&PAYMENT

There are two ways to price products and both mechanisms has its positive and negative sides:

Fixed price offerings in US$/MT or US$/bbl which is usually offered for the first 12 months contract period and subject to review on yearly basis Formula based pricing linked to Platt’s prices around loading dates LESS an agreed discount. Offers usually indicate a gross discount and a net discount to Buyer from Seller. The difference between the two is commission to be shared 50/50 between the brokers (Buyer’s side and Seller’s side). Important Points of Consideration:

Letter of credit amount

The expiry date

The presentation period

A bank is not obligated to transfer a credit

The latest shipment date or given period for shipment

Transferable letters of credit should be issued in an irrevocable form

Transferred credit can not be transferred once again to any third beneficiary according to the request of the second beneficiary

A transferable letter of credit can be transferred to more than one second beneficiary as long as credit allows partial shipments

A letter of credit can be transferred to the second beneficiary at the request of the first beneficiary only if it expressly states that the letter of credit is "transferable"

The terms and conditions of the original credit must be indicated exactly in the transferred credit. However, in order to keep the workability of the transferable letter of credit below figures can be reduced or curtailed

The first beneficiary may demand from the transferring bank to substitute his name for that of the applicant. However, if a document other than invoice required in the transferable credit must be issued in a way to show the applicant's name, in such a case that requirement must be indicated in the transferred credit.