1. Writing a Clear RFQ
An effective RFQ specifies grade (using ISRI codes), required tonnage, frequency, packing, target loading port, destination port, payment terms, inspection nomination and validity. Vague RFQs ('we need 100 MT of aluminium scrap') receive vague offers; specific RFQs ('we need 1 × 40HC of ISRI Tense, baled, FOB Rotterdam, monthly for 12 months, payment 30% advance / 70% against BL copy, SGS inspection, valid 7 days') receive comparable offers.
The single biggest source of friction between buyers and exporters is RFQ ambiguity. Five minutes invested in tightening the RFQ saves days of clarification email.
2. Defining Specifications
Use ISRI Scrap Specifications Circular codes whenever possible — they are the industry-standard shorthand and every reputable exporter understands them. Where a smelter has internal acceptance limits stricter than ISRI (e.g. < 1.5% foreign attachment instead of the standard 2%), state them in writing in the contract.
For alloy-sensitive procurement (6061 vs 6063, 304 vs 316), require XRF PMI as part of the inspection scope and define an acceptance range on the inspection certificate.
3. Evaluating Competing Offers
Compare offers on a like-for-like basis: same Incoterm, same packing, same payment terms, same LME reference date. A 92% LME CIF Nhava Sheva offer with 30% advance is not directly comparable to a 90% LME CIF with letter-of-credit at sight — re-state both in landed-cost terms with financing cost included.
Beyond price, weight the supplier's track record: years in business, third-party inspection history, dispute resolution behaviour, references from existing buyers, and willingness to commit to long-term volume.
4. Structuring a Long-Term Contract
A long-term contract should fix the discount percentage, the LME reference (cash settlement on BL date is the most common), the monthly volume window (e.g. 400–600 MT per month), the inspection regime, the document set, the payment terms, and the dispute-resolution mechanism. The LME number itself remains floating.
In exchange for committing volume, the buyer typically secures a better LME percentage than spot trades — Nautica Metal Scrap B.V. supports contract pricing 1–3 percentage points below spot for buyers committing 12-month volumes.
5. KPIs That Actually Matter
Track five things: on-time loading rate (BL date vs contract window), inspection-pass rate (containers passing without variance), document delivery time (BL to courier), discharge weight variance (BL weight vs weighbridge), and dispute closure time. Anything else is a vanity metric.
Quarterly business reviews against these five KPIs separate professional supply relationships from transactional ones. Procurement teams that run QBRs typically capture 1–2% incremental margin annually through process improvement.
6. Onboarding a New European Supplier
Onboarding checklist: KvK / VAT registration verified, bank reference, Basel/1013 compliance evidenced, two existing-buyer references called, first shipment under reduced volume (1–2 containers) with full inspection, contract conversion only after successful first delivery.
Reputable exporters welcome this process. Suppliers who push back on basic onboarding due diligence are signalling future friction.