Notice. This page is informational and general in nature. Any transaction remains subject to counterparty acceptability, KYC and AML, sanctions screening, legal documentation, collateral controls, insurance, and third-party approvals.
Commodity Supply Chain Finance
Commodity trading margins can be strong on paper and still fail in execution when the cash cycle is not funded correctly. The right structure links procurement, shipment, receivables, and collections into one controlled flow.
FG Capital Advisors supports structured trade and commodity finance mandates, including letter of credit, factoring, forfaiting, and end-to-end supply chain finance programme design with targeted third-party placement.
Request A QuoteWhere This Service Fits
This mandate is built for traders, distributors, and processors that need working capital support from supplier payment through buyer collection.
- Import and export cycles with confirmed purchase and sale contracts.
- Multi-jurisdiction cargo flows with bank document requirements.
- Receivables-heavy businesses facing long buyer payment terms.
- Platforms that want one repeatable funding framework instead of deal-by-deal improvisation.
Core Instruments Under This Mandate
| Instrument | What It Solves | Typical Repayment Source | Key Control Point |
|---|---|---|---|
| Letter Of Credit | Reduces settlement risk between buyer and seller and supports shipment confidence. | Buyer bank payment under compliant documents. | Document compliance discipline and bankable trade terms. |
| Factoring | Converts approved invoices into immediate liquidity. | Collections from assigned receivables. | Receivables eligibility criteria and concentration limits. |
| Forfaiting | Monetizes medium-term trade receivables and transfers payment risk. | Deferred payment obligations purchased at discount. | Instrument quality, obligor profile, and legal enforceability. |
| Supply Chain Finance Programme | Funds suppliers earlier while keeping buyer payables terms intact. | Buyer settlement through a controlled programme structure. | Approved payables process, onboarding rules, and operating controls. |
| Structured Trade And Commodity Finance | Combines inventory, receivables, and transactional controls in one framework. | Contracted sale proceeds through controlled collection accounts. | Title path integrity, collateral monitoring, and cash waterfall discipline. |
Programme Architecture We Build
| Layer | Scope | Why It Matters |
|---|---|---|
| Commercial Layer | Trade terms, Incoterms, payment timing, and dispute rules. | Weak trade terms create lender hesitation and pricing penalties. |
| Collateral Layer | Inventory, receivables, assignment rights, and security package. | Clear collateral logic protects recovery in downside cases. |
| Operational Layer | Document flow, approval authority, reporting rhythm, and exception handling. | Execution discipline prevents slippage and covenant breaches. |
| Funding Layer | Instrument mix across letter of credit, factoring, forfaiting, and revolving lines. | Correct instrument mix lowers friction and improves continuity. |
| Collections Layer | Escrow path, waterfall, reserve triggers, and reconciliation process. | Predictable collections are central to debt sizing and renewal. |
Process And Timeline
Closing speed depends on data quality and response discipline.
| Step | Action | Output |
|---|---|---|
| 1) Intake And Triage | Review commodities, routes, counterparties, existing terms, and working capital gap. | Feasible instrument shortlist. |
| 2) Structuring | Define programme architecture, controls, and risk allocation. | Indicative terms framework. |
| 3) Lender-Ready Pack | Prepare decision-grade memo, financials, legal map, and data room. | Placement-ready submission. |
| 4) Targeted Placement | Controlled outreach to matched trade finance providers. | Indicative terms or written declines. |
| 5) Documentation And Launch | Support execution of definitive documentation and programme onboarding. | Operational go-live path. |
What To Submit For A Quote
- Commodity profile, volumes, shipment cycle, and counterparties.
- Sample purchase and sale contracts with payment terms.
- Existing letter of credit, factoring, or forfaiting lines if any.
- Aged receivables and payables profile with concentration breakdown.
- Logistics route, title path, insurance framework, and warehouse controls.
- Last 12 to 24 months trading performance and margin behavior.
- KYC and AML package for onboarding.
Why Mandates Fail And How To Avoid It
- Problem:
Terms sheet asks for scale before controls are proven.
Fix: Sequence the ask with transaction evidence and phased limits. - Problem:
Contract language is not aligned with finance documents.
Fix: Clean legal alignment before lender circulation. - Problem:
Collections data is incomplete or inconsistent.
Fix: Build a clear receivables and cash waterfall pack. - Problem:
One instrument is forced on every trade type.
Fix: Use instrument fit by cycle stage and counterparty risk.
If you need a financing setup that can handle real commodity turnover, submit your file. We return with executable options across letter of credit, factoring, forfaiting, and supply chain finance programme structures.
Request A QuoteDisclosure. FG Capital Advisors is not a bank or lender and does not provide direct financing. Services are delivered on a best-efforts basis through third-party capital providers, subject to diligence, compliance, and definitive documentation.
