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Not necessarily if that is the usual/normal methods of trading the commodity .... facts are that we don't have knowledge of the whole supply chain whether there are intermediaries involved or we're selling directly to the consumer ... In either event it would not necessarily be to the detriment it's why manufacturers use wholesalers, who sell to retailers who supply the public, some businesses are good at getting stuff out of the ground but they may not have the network, contacts to place all the product as it becomes available so they might use a specialist intermediary either to sell to or operate on a commission & of course they might have a single direct consumer who contracts to take all available product however having a single customer carries as much risk as being single sourced that's the value of intermediaries who have a network of both ......
But as I said it's all conjecture as to the why's, how's & wherefore's but for me I think right now everyone will be focussed on moving this forward & there'll be a significant amount of oversight of all deals & activities whilst it's under the control of the courts so personally I wouldn't worry about it for now ..... but don't let that stop you LoL....
one more question / if a representative for the creditors argued that the sale price could not be the true value due to the way the ore is been sold , due to it been sold by the shipper to third party or more,
lets just say the creditors are getting 80$ but the true value after costs are 120$ would the courts take up on that scenario ,were as if ships were booked for transport only there would be a short fall of 40$ per ton, taken into account each ship has loads of 45000"that will add up to a load of dollars x 8,l am just tinking out side the box"
sorry for asking but l have this gut feeling that people are getting ripped off big time.
cheer bannor that has put rite lol
No I wouldn't say so MD .... the courts are not likely to rule on what value the ore should/would or must be sold at, market forces take care of that I also don't see them getting overly involved in mandating payment terms although they might insist that this is completed by a secure method such as an LC ..... for me the courts will rule on matters of dispute & legality but to the extent they can they will (under their authorisation to ship) expect & allow DEV to secure the best deals for the best value as the market & commodity will permit .... if it were to become evident there was any underhand activity not in the interests of the recovery process someone (such as the banks or other creditors) might alert/challenge that & the courts would need to consider whether there was any legitimacy to the concern & if necessary act accordingly.
"according to the courts, the banks cannot prevent the company's business from continuing, especially to the point of preventing its recovery. The decision maintains that the sale will enable the resumption of the company's activities, favoring all creditors."
bannor / could this be one of the reason the courts out line cadence ,because the value of the ore sales to the creditor is so poor
TC .. you need to Google ICC incoterms there are 11 in total (EXW, FCA, FAS, FOB, CFR, CPT, CIF, CIP, DPU, DAP, DDU) these can be modified to reflect practices &/or specific mutual agreement between a buyer & seller .... the closest to your FMG would either be EXW mine gate (if the buyer supplies manpower, loading equipment & accepts loading risks) meaning the seller simply makes it available for collection on the floor .... or FCA mine gate (if the seller provides the manpower, equipment & risks of loading the collecting vehicle provided by the buyer) .... These also dictate whose responsible for organising & paying customs formalities & the exporter is often best placed to sort this element but as said having got to the most appropriate/desired Incoterms with agreement the specifics of each one can be tweake by agreement between the relevant parties but any contract should reflect clearly what any agreed tweaks are - trust me if it goes to court it needs to be saying things like we had it verbally agreed or shook hands in it doesn't wash.
Also quite often with bulk loads of this type there is often a succession of purchases & sales transactions (under different payment & trading terms) between traders & dealers which can take place for the same cargo whilst in transit so the party that purchases & processes it in China could potentially be two or more parties removed from the original seller.
The other thing to remember is that Incoterms whilst potentially linked are completely separate & distinct to payment terms which are subject to separate agreement (stated/full) & methods from deferred letters of credit through CAD to account & cash in advance....
There is nothing stopping them doing either or depending on what works out best. Our second shipment was the same FOB arrangement - we didn’t pay shipping costs. It doesn’t really make any difference to us as the end resultant net profit is very similar and I’m sure we would do whatever achieves the best price. Gerald may have a different arrangement with their buyer given they are a metal trader they could have a buyer for the whole lot, but the principal is the same.
the way i’m seeing it is… the shipments for the banks settlement are fpg (i.e. the 1-ship that’s gone and excludes shipping costs)… the other ones are for the jrp…
are you sure it’s fob… or at the mine gate (what’s the fob for that anyone fmg?)… or in the instance of the stockpiles at santana… at the private port gate (fpg?)… don’t forget that gerald are picking up the cost to move their stockpiles at the mine… once we get the railroad up and running… so is fmg… i’d expect the same for what’s already at the port… wouldn’t you…
Yes 1.39mt * $80 = $110m (minus handling)
Indeed @EV. You can see in the haul that one of DEV's first three were FOB, presumably to test costs. $80 sounds about right - though I haven't got the calculator out! ;-)
It's called Free on Board (FOB) to describe the point at which a seller is no longer responsible for shipping costs.
https://www.linkedin.com/pulse/iron-ore-you-care-fob-cif-benjamin-cox
Yes, $80 is almost all profit though because this type of agreement is from the "gate" / dock side i.e the buyer pays for shipping costs.
being sold on the cheap..
:O valor demonstrado na Invoice é de USD 80,48 por tonelada molhada;
"The Pedra Branca do Amapari mine, in Amapá, is back in operation, says the newspaper Valor. The project, which belonged to Zamin, expects to complete the shipment of 180,000 tonnes of iron ore to China this month. Exports of the commodity generated revenues of US$ 10 million."
https://twitter.com/PauloSilva1955/status/1423040604653686785
Well that near doubles everything. Just hopefully not the time to completion with the banks! Which could land tomorrow. ;-)
wow…
I think it’s fair to say… the day this deal is signed we are all going to be very very happy:)
Original article is paywalled
Iron mine in AP returns to export operations
"The former Zamin project is expected to complete the shipment of 180,000 tonnes this month"
https://valor.globo.com/empresas/noticia/2021/08/04/mina-de-ferro-no-ap-volta-a-operar-com-exportacao.ghtml
Good find @EV_Bull and posted just 7 hrs ago
"Located in Pedra Branca do Amapari, in Amapá, DEV Mineração's iron ore project intends to complete the shipment of a batch of the product to China by the end of the month, according to Valor newspaper. DEV took over the Zamin venture.
The export operation is part of the payment of debts with the banks of the former owner of the enterprise. Other shipments must be made to remedy existing liabilities. With the debts paid off, investments must be made in the plant to increase the exploration and processing of iron ore.
The iron ore reserve in the project is 251 million tons. The annual production capacity is 5.3 million tons, but with investments, it can reach a nominal capacity of 11 million tons per year."
https://revistaminerios.com.br/planta-no-amapa-exporta-minerio-de-ferro/