Inspection is a critical step in commodity trading where independent, accredited surveyors verify the quality and quantity of a cargo at the point of loading and/or discharge. Inspection certificates are required for payment and form part of the shipping document set.
Purpose of Inspection
Inspection ensures that the cargo conforms to the agreed specification and quantity before payment is released. It protects both buyer and seller by providing an independent, verifiable assessment of the goods at the point of transfer.
Independent Inspection Agencies
Recognized inspection companies such as SGS, Intertek, Bureau Veritas, and Cotecna conduct inspections at loading and discharge terminals. Their certificates are accepted by banks, insurers, and trading counterparties worldwide.
Types of Inspection
Inspection may include quality testing (laboratory analysis against agreed specifications), quantity determination (tank gauging, mass flow metering, or weighbridge measurement), and condition surveys. The SPA specifies which inspections are required and who bears the cost.
Inspection Certificates
Inspection certificates form part of the document set required for letter of credit presentation. A certificate of quality (COQ) and certificate of quantity (COQ) are typically issued. Discrepancies between load and discharge results are resolved per the SPA terms.