Commodity trading questions, answered

A broker connects buyers and sellers and earns a commission, while a trader buys goods on its own account and resells them. Andalucia Premium works as a broker: we do not take market positions or hold stock, we structure transactions between verified companies.

Usually through a commission agreed in writing before the transaction, typically paid by one or both principals once the deal has been settled. The amount and the paying party are part of the contractual documentation and are never hidden in the price.

Product and specification, quantity, delivery window, destination or loading port, preferred Incoterms® rule and payment instrument, plus your company details. The more precise the request, the faster we can check whether it is realistic.

A serious broker’s commission is agreed in writing and is normally tied to a concluded transaction. Be cautious with anyone who asks for upfront fees for introductions or offers; costs such as inspection or freight are agreed between buyer and seller in the contract.

We work in English, Spanish and German. Contracts and shipping documents are normally drawn up in English, the common language of international commodity trade.

There is no fixed company size, but you must be a registered company that passes a know-your-customer check and can realistically perform the transaction. The volume must also match what producers and trading houses usually supply in that product.

It depends on product, quantity and route, but several weeks is typical. Verification, negotiation and opening of the payment instrument usually take longer than the shipment itself.

We check whether the request is realistic and whether we can serve it, then start the know-your-customer check. Only after verification do we approach suitable counterparties and exchange commercial documents.

Often yes. Many suppliers accept a smaller first lot under the same contract, so that both sides can test quality, logistics and payment before agreeing to regular deliveries.

Yes. Producers and trading houses can approach us with available cargoes; after verification we look for buyers whose requirements, volumes and payment terms match the offer.

It depends on the product and the form of delivery. Vessel cargoes start at volumes that justify chartering a ship, while containers, big bags or trucks allow smaller lots; tell us your requirement and we check what is realistic.

Check the company in the official commercial register, ask for KYC documents and verify them, and confirm any proof of product directly with the terminal, warehouse or inspection company. A genuine supplier accepts independent inspection and bank-secured payment.

For new trading relationships, a confirmed irrevocable documentary letter of credit usually offers the most balanced protection. The seller is paid against compliant documents and the buyer pays only against proof of shipment.

A letter of credit is the payment mechanism itself: the bank pays when compliant documents are presented. A bank guarantee or standby letter of credit only pays if one party fails to perform, so it works as security rather than as the normal way of paying.

Yes, telegraphic transfer is common between parties that already know each other, often with a partial payment against documents. For new relationships we advise against unsecured advance payments to unknown parties.

This is a matter of negotiation and is written into the contract. A common arrangement is that each party pays the charges of its own bank, while confirmation costs are agreed separately.

No. A standby letter of credit is issued by a bank on behalf of its client to secure a specific obligation; it is not an investment and is not bought, sold or leased. The FBI’s Internet Crime Complaint Center (IC3) warned in 2019 that SBLCs are not traded or bought and sold and that such investments do not exist.

In fraudulent procedures, the demand for a buyer’s SBLC or MT760 before the seller has proven identity and product is a common pattern. In genuine trade, security and proof of product are exchanged under a balanced procedure between verified parties.

A bill of lading is the transport document issued by the carrier when goods are loaded on a vessel. It confirms receipt and condition of the goods, serves as the contract of carriage and, in its negotiable form, represents title to the cargo.

An ICPO (irrevocable corporate purchase order) is a buyer’s written declaration of intent to purchase a specific product on stated terms. Despite its name it is not a binding contract on its own; the binding document is the signed sales and purchase agreement.

An FCO is a seller’s written offer stating product, specification, quantity, price basis, Incoterms® rule, inspection and payment terms. It is the basis for drafting the sales contract and should only be issued after both parties have been verified.

Exactly those listed in the credit, typically the commercial invoice, bill of lading, packing list, certificate of origin and independent quality and quantity certificates. Any discrepancy between the documents and the credit terms can delay payment.

An NCNDA (non-circumvention, non-disclosure agreement) is meant to protect intermediaries and confidential information. Sign one only after both sides have verified each other, and remember that it proves nothing about the goods or the deal.

Typically an extract from the commercial register, articles of association, identification of directors and beneficial owners, proof of address and, depending on the product, licences or trade references. The exact list depends on product, jurisdiction and the banks involved.

We screen companies, owners and vessels against the EU consolidated sanctions list, United Nations lists and, where relevant to the transaction, other regimes such as those of the United Kingdom and the United States.

We do not broker any transaction that breaches applicable sanctions. Where a country is subject to restrictions, we check whether the specific product, parties and payment route are permitted; if they are not, we decline.

Because anti-money-laundering rules and sanctions apply to the people who ultimately own or control a company, not just to its name. Identifying beneficial owners is a standard part of any serious verification.

Spanish companies are registered in the Registro Mercantil, and official extracts can be requested from the Registradores de España, including online. Compare the company name, tax number (NIF), registered address and directors with the documents you received.

There is no single best rule. Buyers with their own chartering capacity often prefer FOB, while buyers who want delivered prices usually choose CFR or CIF; the choice depends on who can secure freight and insurance on better terms.

Dry bulk such as fertilizers, scrap or pellets travels in bulk carriers, liquids in tankers, and smaller lots in containers, big bags or bags. The form of transport is agreed in the contract together with loading and discharge terms.

Demurrage is compensation paid to the shipowner when a vessel stays in port longer than the agreed laytime for loading or discharge. Laytime, the demurrage rate and who bears it are set in the charter party and should be mirrored in the sales contract.

Andalusia alone has major ports such as Algeciras, Huelva, Seville, Málaga and Almería. Which port suits a transaction depends on the product, the vessel size and the terminal facilities available.

An independent inspection company appointed under the contract, for example SGS, Bureau Veritas or Intertek. It samples, analyses and measures the goods and issues certificates of quality and quantity.

The contract determines the remedy, typically price adjustments, rejection or claims based on the agreed inspection results. Whether the load-port or discharge-port inspection is final should therefore be agreed in advance.

A certificate of analysis (COA) reports the measured properties of a product, such as nitrogen content, sulphur or fineness, against the agreed specification. It may be issued by the producer or by an independent laboratory.

Usually yes. Buyers can appoint their own surveyor or attend the sampling at their own cost, provided this is agreed in the contract and the terminal permits it.

The contract decides. Often the seller pays for the load-port inspection and the buyer for any additional inspection it requests, but other splits are possible.

We broker urea 46% N, NPK compound fertilizers, DAP and MAP, potash (MOP) and ammonium sulphate between producers, trading houses and importers. Other products can be checked on request.

Urea is shipped in bulk vessels, in big bags or in bags on pallets or in containers. Because it absorbs moisture, dry storage and careful handling are important to avoid caking.

FOB at the load port and CFR or CIF to the destination port are the most common for seaborne fertilizer cargoes. For container lots and inland deliveries, FCA, CPT or DAP are often used.

Yes. Besides shipping and inspection documents, imports must comply with EU product, labelling and safety rules, and nitrogen fertilizers are within the scope of the EU carbon border adjustment mechanism (CBAM).

Granular urea has larger, harder granules, produces less dust and is generally preferred for long-distance bulk shipments and blending. Prilled urea has smaller particles and is also used for direct application and industrial purposes; the right choice depends on the use and the handling chain.

Biuret is a by-product formed during urea production that can damage sensitive crops, particularly with foliar application. Fertilizer-grade urea is therefore typically specified with a biuret limit, for example max. 1.0%, which is confirmed in the certificate of analysis.

Hot rolled, cold rolled and galvanized coils, pre-painted coils, rebar, billets, wire rod, beams and sections as well as steel scrap. Grades and standards are agreed per transaction.

Hot rolled structural steels are commonly specified according to EN 10025, for example S235JR or S355J2. Reinforcing steel is specified by grade, such as B500B or B500C, under the applicable national standards.

Coils, rebar and sections are usually shipped as break bulk on general cargo or bulk vessels, smaller quantities in containers. Scrap travels in bulk.

Yes. Many steel products are covered by EU trade defence measures such as safeguard quotas or anti-dumping duties, and steel is within the scope of CBAM. The current rules must be checked for each product and origin.

Most steel contracts require an inspection certificate type 3.1 according to EN 10204, issued by the mill’s inspection department for the delivered batch. Where the project or regulations demand it, a type 3.2 certificate involving an independent or purchaser’s inspector is agreed.

Look for mills or stockholders that can document the grade, for example B500B or B500C, with mill test certificates, meet the required standard of the destination market and accept independent inspection. Verification of the company and realistic delivery times matter as much as the price.

Only companies and institutional counterparties, such as refineries, banks, bullion dealers and industrial users, that pass a full KYC and anti-money-laundering check. We do not serve private investors.

LBMA Good Delivery is the standard of the London Bullion Market Association for large gold and silver bars traded in the London market. Bars must come from an accredited refiner and meet requirements for weight, fineness and markings.

Through assay, weighing and checking of bar numbers, refiner marks and documents such as the refiner’s certificate and chain-of-custody records. Handover usually takes place in a secure vault or refinery.

Gold is a high-value, easily transportable asset and is therefore a known target for money laundering and conflict financing. Thorough checks protect both parties and are required by law.

A company buys gold bars wholesale by contract from refineries, bullion banks or wholesalers after a full KYC and anti-money-laundering check. Bars from accredited refiners, assay documentation and a secure handover in a vault are standard.

No. We are not an online trading platform and do not offer accounts, price feeds or retail sales. We broker physical precious metals between verified institutional counterparties.

Logs, sawn softwood and hardwood, plywood, OSB and MDF panels, wood pellets and packaging timber. Every product must come from documented, legal sources.

The EU Deforestation Regulation (EU) 2023/1115 requires that wood and other covered products placed on the EU market are deforestation-free, legally produced and covered by a due diligence statement. It replaces the earlier EU Timber Regulation (EUTR).

ISPM 15 is the international standard for treating wooden packaging material, such as pallets and crates, to prevent the spread of pests. Treated packaging carries an official stamp.

Sawn timber and logs are usually traded per cubic metre, panels per cubic metre or per sheet, and pellets per tonne. The measurement method should be stated in the contract.

Typically commercial invoice, packing list, bill of lading, certificate of origin, phytosanitary certificate where required, and evidence of legal harvest such as due diligence information under the EUDR. Certified products also need FSC® or PEFC chain-of-custody claims on the invoice.

Diesel EN 590, Jet A-1, fuel oil such as VLSFO and HFO, and base oils, between refineries, trading houses, distributors and industrial consumers.

Jet A-1 is the kerosene-type fuel used in civil aviation in most of the world. It is specified in standards such as DEF STAN 91-091 and ASTM D1655.

By tanker vessel, through a transfer within a tank storage terminal or by truck. Quantity and quality are confirmed by independent inspection at the point of transfer.

Because sanctions regimes restrict products by country of origin and, in some cases, by the origin of the crude oil. A documented origin is required before we pursue any petroleum transaction.

It refers to diesel meeting the European standard EN 590 with a maximum sulphur content of 10 mg/kg, often written as 10 ppm. The specification also covers properties such as cetane number, density and flash point.

Yes, provided the product meets EU fuel quality requirements, customs and excise rules are followed and the transaction complies with sanctions. EU sanctions prohibit refined products from Russia and restrict products refined from Russian crude in third countries; this is general information, not legal advice.