Case Study

Scenario

Mining company DigitUp Ltd has secured an order to ship 50,000 wet tonnes of Nickel Ore to a customer in Asia.  A price of $60 per wet tonne has been agreed and the shipping logistic has been arranged.  However, the customer fails to make payment and Digitup Ltd is left with no buyer and is under financial strain.

Solution



CME agrees to be the customer and purchases the ore at a price of $68 per wet tonne giving the client an $8 per tonne price increase.  Since CME is financially secure Digitup now have payment security and at the same time have mitigated the risk of liquefaction of nickel ore cargoes.