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How is U.S. wheat purchased?
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| Buying wheat is a serious enterprise, especially since there is a high financial risk due to the large volumes of the commodity traded. Thus, in order for an inquiry to be considered by a reputable exporter, a buyer should be prepared to provide the following information:
- Quantity and loading tolerance
- Quality (be very specific and provide the clients tender specifications if available)
- Shipment period
- Vessel size and restrictions
- Vessel load and discharge rate guarantees
- Vessel demurrage and dispatch rate
- Loading and discharge range
- Number of allowable berths
- Phytosanitary certification requirements
- Aflatoxin requirements
- Proposed method of payment
- Copy of the letter of credit (if this is the proposed method of payment)
- Financial references of your company
- Statement from the buying principal that your firm is the sole and exclusive agent
- Statement from the buying principal that the exporter will not be held liable for brokerages, finders fees, commissions, etc.
- A brief company history, including the names of the officers
An importer who is ready to buy will typically seek offers from exporters through either direct negotiations with specific suppliers or through an invitation for bids. Buyers who negotiate directly usually watch the U.S. cash market for advantageous times to make their purchase and then negotiate private transactions. Those issuing an invitation operate through a public or private tender system. |
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