If you are buying
- A written specification with a limit for every element that matters (minimum grade, maximum penalty elements, size, moisture) and the basis it is measured on, dry or as received.
- Assay evidence, and who produced it. Results from the seller's own laboratory or a government laboratory are a starting point. Ask for an independent laboratory's result on a composite sample before you commit.
- Agreed sampling and weighing: the standard used (for manganese ore, ISO 4296), a draft survey at the load port, and who appoints the inspector.
- A settlement clause: assay exchange with splitting limits, and the umpire laboratory named in advance.
- Payment that is secured. An irrevocable letter of credit at sight, issued by a bank you can verify, protects a buyer more than advance payment to a party you have not met.
- Proof of title and permits: that the seller owns the material or holds a written mandate from the owner, and that the export licence and origin documents are in place.
- Shipping documents that match the cargo. For cargoes that can liquefy, a shipper's declaration with the moisture content and transportable moisture limit before loading.
- A counterparty you have checked: company registration, named directors, bank details, and contact numbers you found yourself, not only those in the offer.
If you are selling
- An assay certificate that says where and how the samples were taken, how many, and by which laboratory. Buyers will ask whether it covers the whole lot or only a few samples.
- The elements buyers will ask about even if you have not tested them: phosphorus and moisture for manganese ore, Cr:Fe ratio for chrome ore, arsenic and other harmful elements for concentrates.
- Quantity actually available, form (lump or fines), packaging or bulk, loading port, and when it can be loaded.
- Proof that you may sell it: ownership or mandate, the export licence, and the origin documents.
- A price basis you can explain: FOB, CFR or CIF, per dry tonne unit or per tonne, and against which published benchmark.
- Willingness to accept independent inspection at the load port and a letter of credit at sight, which most serious buyers will insist on.
- A sample ready to send, and an assay of that sample from a laboratory the buyer accepts.
Red flags on either side
- A request to pay fees, deposits or advance payments before any inspection or letter of credit.
- Unsolicited buyer or seller posts on open trade directories for very large volumes, with no company name. These are a frequent source of scams and should not be relied on.
- A counterparty who will not name the company, the owner or the loading port, or whose documents give different names and addresses.
- Refusal of independent inspection or of a letter of credit, with no explanation.
- A price far from the published benchmark for the grade, in either direction.
- Pressure to ship or pay quickly, or to skip the assay exchange.
Where to find the figures this checklist refers to
Grades, specifications and penalty elements are covered in the ore guides for manganese ore, iron ore, chrome ore and lead and zinc concentrates. Terms such as umpire, splitting limit, dmtu and transportable moisture limit are defined in the glossary.
Frequently asked questions
What is a letter of credit at sight?
A bank's undertaking, issued at the buyer's request, to pay the seller when the seller presents the documents the credit calls for, with payment due on presentation instead of at a later date. It is the usual way to secure payment on an ore shipment.
Who pays for independent inspection?
It is set in the contract. Sharing the cost, or the buyer paying for inspection at discharge and the seller at loading, are common arrangements. Agree it before shipment.
What should a buyer ask a first-time ore seller for?
The specification, an assay and who produced it, proof of ownership or a mandate, the export licence, the loading port and quantity, and willingness to accept independent inspection and a letter of credit at sight.
How do you tell if an ore offer is a scam?
Common signs are advance payment requests, anonymous parties, refusal of inspection or a letter of credit, mismatched documents and prices far from the benchmark. Check the company independently and do not pay before inspection.
Sources
- ISO 4296-1:1984 Manganese ores: increment sampling
- Dataminesoft: assay rules in sales and purchase contracts
- UK MCA Marine Guidance Note 511 (IMSBC Code shipper's documents)
- Hill Dickinson: cargo liquefaction and Group A or Group C classification
Specifications published by index providers are revised over time. Where a figure comes from a pricing notice, confirm the version currently in force with the publisher before you use it in a contract. Corrections are welcome.