Sulphur deal structuring
Granulated sulphur on twelve-month contracts with monthly lots: the seller checked on site, and every document and payment owned before the first vessel loads.
Only goods of non-sanctioned origin. Sanctions screening of all parties is mandatory.
The deal from the buyer’s side
A buyer of granulated sulphur starts with two questions: can this seller actually deliver, and is the offer real. Both are fair. Much of what circulates as sulphur offers is a trader’s cargo resold down a chain rather than the producer’s, and the paperwork rarely says which.
Supply usually runs on a twelve-month contract with monthly lots, at a typical purity of 99.95% or higher. Over a year, the risk is less in the first cargo than in the routine: who releases money against which document, and who notices when a monthly lot slips. On a mandate for a trader with a large monthly volume, the work is exactly that: financial logistics, the full document flow and reporting, each with an owner and a date before the first vessel loads.
For the buyer’s bank, a long contract has to survive financial monitoring. In one sulphur mandate the contract went through eight drafts before it met the buyer’s monitoring requirements. That work is part of the deal, not an obstacle to it.
What we check at the seller
Whether the cargo is the producer's or a trader's resale, and how many links stand between the buyer and the stock.
Stock on the ground: auditors visit the warehouse, count the stock and attend a loading for another client.
Registration, ownership and the signatory's authority: in open sources, then through the seller's bank with the seller's written authority to verify.
Sanctions screening of the seller, its owners and the vessels.
Any payment requested from the buyer before a contract exists. That ends the conversation.
Typical structure
Delivery basis
A twelve-month contract with monthly lots. The Incoterms 2020 basis is fixed in the contract for every lot.
Payment instrument
A documentary letter of credit or SBLC under UCP 600, with the release of money tied to defined triggers at each stage of each lot.
Inspection
Independent inspection of quantity and quality at loading for every lot, against the contract specification.
Document route, step by step
Financial logistics
How money moves against cargo, stage by stage, and what triggers each payment. Agreed before the contract is signed.
Document map
For every document: when it is needed, who issues it, who checks it and who holds it.
Contract
Drafted and revised until it meets the buyer's financial-monitoring requirements.
Payment instrument
The buyer's bank issues the instrument. The seller checks it and provides performance security.
Monthly lots
Each lot: loading, inspection certificates, the bill of lading, the invoice, presentation and payment.
Reporting
The position on one page: loaded, paid, due. Every document, payment and report has an owner and a date before the first vessel loads.
Where these deals stall
- —The cargo turns out to be a resale several links away from the stock, and the seller cannot show it on the ground.
- —Nobody owns a document or a payment trigger, and the second or third lot slips.
- —The contract does not pass the buyer's financial monitoring, and the drafting starts again.
- —The offer's validity expires while the parties argue about the price.
Checklists by deal step
Have a deal in this commodity?
Send us the offer or the structure. We reply within two business days.