CONTRACT FOR IRON ORE FINES02
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1 Ref : A-2 CONTRACT No.: KIOCL/BFU/IOF/2007-08/02 DATE : XXXXXXXXXX
BUYER : XXXXXXXXXX
SELLER : XXXXXXXXXX
This Contract is made by and between the Buyer and the Seller, whereby the Buyer agrees to buy and Seller agrees to sell the under mentioned goods on the terms and conditions stated below:
NAME OF COMMODITY : Iron Ore Fines 1.1 COUNTRY OF ORIGIN : India 1.2 DESTINATION : China 2.0 DELIVERY PERIOD AND QUANTITY :
2.1 DELIVERY PERIOD : MARCH 2008
2.2 QUANTITY : 35,000 MT+/-10%
The Delivery schedule for the above quantities shall be mutually agreed between Buyer and Seller. Any changes in the same will be made subject to mutual consent.
Port of Loading : New Mangalore Port, India 2
3. SPECIFICATIONS: Guaranteed Specifications of Iron Ore Fines: A. Chemical Composition (On Dry Basis) Guaranteed Specification
Fe 61.50 % MIN SILICA - SiO2 6.90 % MAX. ALUMINA - Al2O3 2.70 % MAX S 0.05 % MAX P 0.08 % MAX. B. Physical Properties Above 10 mm 6.00 % MAX Below 10 mm 94.00 % MIN C. MOISTURE (Free moisture loss at 1050C shall be) 8.00 % MAX.
4. PRICE: The price payable by Buyer to the Seller shall be US$ xxxxx per DMT FOB stowed and seaworthy trimmed New Mangalore, India on the basis of 61.50 % Fe. The price is applicable for this shipment in March 2008 as per the agreed laycan.
For iron ore fines the base price shall be increased or decreased on fraction prorata basis on Fe above or below 61.50%,.
5. PRICE ADJUSTMENT
If the shipment does not meet any of the chemical specifications other than Fe provided in Clause 3 as finally determined in accordance with the provisions of Clause 13 the base price shall be decreased as follows:
i) For Excess Silica At the rate of Five (05) US Cents per dry metric ton for each 1.00 % in excess of 6.90 %, fractions prorata.
ii) For Excess Alumina At the rate of Five (05) US Cents per dry metric ton for each 1.00 % in excess of 2.70 %, fractions prorata.
ii) For Excess Sulphur At the rate of five (05) US Cents per dry metric ton for each 0.01% in excess of 0.05% fractions prorata. 3
iii) For Excess Phosphorus At the rate of five (05) US Cents per dry metric ton for each 0.01 % in excess of 0.08 %, fraction prorata.
5.4 Moisture: If free moisture loss at 105 degrees centigrade as finally determined pursuant to the provisions of Clause 13 exceeds the guaranteed max. referred to in Clause 3. Seller shall pay Buyer half of the actual freight attributable to moisture content over 8% upto and including 9.00 %, and full actual freight attributable to moisture content over and including 9.01 %.
5.5 Size Penalty:( Above 10 mm) In case + 10 mm are more than 6.00 %, at the rate of US Dollars 0.10 per wet metric ton for quantity exceeding 6.00 %. fraction prorata.
6. PAYMENT: Buyer shall open, 10 days prior to the shipment, with any bank acceptable to Seller's bank, a letter of credit which is irrevocable, unrestricted for negotiation, divisible, and without recourse to drawer with STATE BANK OF INDIA, SPECIALISED COMMERCIAL BRANCH (4196), 1ST FLOOR, KRISHI BHAVAN , HUDSON CIRCLE, BANGALORE-560 001, Fax No. 0091 - 80 – 2222 0486, SWIFT: SBININBB113 in favour of Seller in US Dollars for 100% of the estimated value of the shipment assuming for guaranteed iron content. The L/C has to contain suitable reimbursement clause for reimbursement of the amounts to negotiating bank. The L/C shall permit prorata negotiation. The Letter of Credit shall be initially valid for negotiation for at least 60 days. Buyer shall be responsible to extend the validity of the LC further, if required, till the full settlement of sales proceeds.
The terms of the L/C have to be in accordance with the terms of contract. The Letter of Credit in an acceptable form and as per contract to be received at least 4 days before commencement of laydays. The arrival of the vessel shall be deemed to be shifted to 4 days from the date of receipt of Letter of Credit for calculation of the laytime. The latest shipment date should provide for at least 15 days from the end of the laydays.
The said Letter of credit shall be payable by telegraphic transfer reimbursement by opening bank against Seller's sight draft for the amount of hundred (100) per cent of the value of each respective shipment accompanied by the documents as stipulated in Clause 7, Weight Certificate issued by qualified surveyor by survey of ship's draft together with the certificate of analysis of sample and of the percentage of free moisture loss at 105 degrees centigrade issued by Seller shall be the basis for Seller's Commercial invoice.