EXPORT OF BRAZILIAN SUGAR - AGREEMENTS AND PROCEDURES

Continuing with the series of posts covering negotiation procedures in the Brazilian Market, I’d like to share some thoughts on the Sugar Business.

This will be interesting to the Trading Companies and independent agents interested in purchasing Brazilian Sugar.

The guidelines below have been originally developed by Mr. Marcio Valadares, an outstanding lawyer with practice in Belo Horizonte, and with whom I had the honor to work. His law firm is still a reference in Turnkey Contracts.

Now, let’s go to work:


USUAL INFORMATION / DOCUMENTS REQUIRED FOR INITIAL INQUIRIES AND QUOTATIONS

1. SPECIFICATIONS :
1 .1 POLARIZATION
ASH CONTENT
MOISTURE
SOLUBIITY
COLOR
GRANULATION
RADIATION
INSPECTION
MINIMUM ORDER
PACKAGING
OTHERS, AS REQUESTED

2. DETAILS REQUESTED FOR BEGINNING NEGOTIATION WITH THE SELLER/SELLER´S
MANDATE/ SELLER´S REPRESENTATIVE – SUPPLIER, BROKER, AGENT, ON A CASE BY
CASE BASIS:
2.1 COMMODITY DESCRIPTION
QUANTITY
PACKING
TARGET PRICE
DESTINATION PORT (ASWP OR AS SPECIFIED) AND COUNTRY
INCOTERMS (USUALLY CIF)
INSPECTION (USUALLY SGS OR EQUAL)
PAYMENT TERMS
TRIAL ORDER, IF ANY
DELIVERY PER MONTH OR DELIVERY SCHEDULE
PERFORMANCE BOND – MAXIMUM 2%.
OTHERS, AS REQUESTED.

PRELIMINARY STEP

NCNDA ( NON - CIRCUMVENTION AND NON DISCLOSURE AGREEMENT) IS MADE AND SIGNED BY AND BETWEEN THE BUYER / BUYER´S AGENT OR REPRESENTATIVES AND THE ONES INVOLVED IN SEARCHING FOR THE SUPPLY SOURCES IN BRAZIL

STANDARD PROCECURES

1. BUYER ISSUES LOI (LETTER OF INTENT) AND BCL (BANK CAPABILITY LETTER) OR LOI
WITH COMPLETE BANKING DETAILS AND AUTHORIZATION FOR SOFT PROBE BY THE SELLER
2. SELLER RESPONDS WITH FCO (FULL CORPORATE OFFER).
3. BUYER SIGNS AND RETURNS FCO
4. CONTRACT IS SIGNED AND EXCHANGED VIA FAX OR EMAIL AND HARD COPIES
5. BUYER´S BANK ISSUES PROOF OF FUNDS (POF) AND DRAFT LETTER OF CREDIT (L/C)
AND SELLER OR SELLER´S BANK RESPONDS WITH PROOF OF PRODUCT (POP) AND
APPROVES L/C DRAFT
6. BUYER´S BANK ISSUES L/C PREADVICE, TO BECOME OPERATIVE WHEN THE PERFORMANCE
BOND (PB) AGREED BY THE PARTIES IS RECEIVED
7. SELLER´S BANK ISSUES PB TO ACTIVATE L/C
8. FIRST SHIPMENT COMMENCES 30-45 DAYS OR WITHIN ANOTHER AGREED TIME PERIOD
AFTER RECEIPT OF ACCEPTABLE L/C

EXPORT OF BRAZILIAN SUGAR - AGREEMENTS AND PROCEDURES

Continuing with the series of posts covering negotiation procedures in the Brazilian Market, I’d like to share some thoughts on the Sugar Business.

This will be interesting to the Trading Companies and independent agents interested in purchasing Brazilian Sugar.

The guidelines below have been originally developed by Mr. Marcio Valadares, an outstanding lawyer with practice in Belo Horizonte, and with whom I had the honor to work. His law firm is still a reference in Turnkey Contracts.

Now, let’s go to work:


USUAL INFORMATION / DOCUMENTS REQUIRED FOR INITIAL INQUIRIES AND QUOTATIONS

1. SPECIFICATIONS :
1 .1 POLARIZATION
ASH CONTENT
MOISTURE
SOLUBIITY
COLOR
GRANULATION
RADIATION
INSPECTION
MINIMUM ORDER
PACKAGING
OTHERS, AS REQUESTED

2. DETAILS REQUESTED FOR BEGINNING NEGOTIATION WITH THE SELLER/SELLER´S
MANDATE/ SELLER´S REPRESENTATIVE – SUPPLIER, BROKER, AGENT, ON A CASE BY
CASE BASIS:
2.1 COMMODITY DESCRIPTION
QUANTITY
PACKING
TARGET PRICE
DESTINATION PORT (ASWP OR AS SPECIFIED) AND COUNTRY
INCOTERMS (USUALLY CIF)
INSPECTION (USUALLY SGS OR EQUAL)
PAYMENT TERMS
TRIAL ORDER, IF ANY
DELIVERY PER MONTH OR DELIVERY SCHEDULE
PERFORMANCE BOND – MAXIMUM 2%.
OTHERS, AS REQUESTED.

PRELIMINARY STEP

NCNDA ( NON - CIRCUMVENTION AND NON DISCLOSURE AGREEMENT) IS MADE AND SIGNED BY AND BETWEEN THE BUYER / BUYER´S AGENT OR REPRESENTATIVES AND THE ONES INVOLVED IN SEARCHING FOR THE SUPPLY SOURCES IN BRAZIL

STANDARD PROCECURES

1. BUYER ISSUES LOI (LETTER OF INTENT) AND BCL (BANK CAPABILITY LETTER) OR LOI
WITH COMPLETE BANKING DETAILS AND AUTHORIZATION FOR SOFT PROBE BY THE SELLER
2. SELLER RESPONDS WITH FCO (FULL CORPORATE OFFER).
3. BUYER SIGNS AND RETURNS FCO
4. CONTRACT IS SIGNED AND EXCHANGED VIA FAX OR EMAIL AND HARD COPIES
5. BUYER´S BANK ISSUES PROOF OF FUNDS (POF) AND DRAFT LETTER OF CREDIT (L/C)
AND SELLER OR SELLER´S BANK RESPONDS WITH PROOF OF PRODUCT (POP) AND
APPROVES L/C DRAFT
6. BUYER´S BANK ISSUES L/C PREADVICE, TO BECOME OPERATIVE WHEN THE PERFORMANCE
BOND (PB) AGREED BY THE PARTIES IS RECEIVED
7. SELLER´S BANK ISSUES PB TO ACTIVATE L/C
8. FIRST SHIPMENT COMMENCES 30-45 DAYS OR WITHIN ANOTHER AGREED TIME PERIOD
AFTER RECEIPT OF ACCEPTABLE L/C