How an FOB cashew order works: quote to bill of lading
A food importer in Lyon is about to place her first order for W320. The quote came from Luason, the emails came from Luason, and now the sales contract on her desk names a Vietnamese processing factory as the seller, with a bank account in that factory's name. Her finance manager puts the transfer on hold and asks who exactly they are paying.
They are paying the factory, and that is how the order is meant to work. An FOB cashew order with Luason starts with a published price and a PDF quotation, goes through free samples, and ends in a contract that the factory signs as seller and Luason signs as its authorized sales agent. You pay the factory's account. The factory produces, clears the goods for export and loads them on the vessel your forwarder booked at Ho Chi Minh City (Cat Lai). Once the goods are on board the risk is yours, and the bill of lading records the moment.
Here is each step in order, with the names, dates and documents you will meet and what to check before money moves.
The order at a glance
| Step | What you do | What you get | Where |
|---|---|---|---|
| Read the FOB price per grade | A dated price in USD per metric ton | Price board |
| Choose grade, packing, tonnes and Incoterm, confirm your email | A PDF quotation, valid for 7 days on cashew kernels | Quote form |
| Pick up to three grades | 100 g to 1 kg of each, free, by courier | Sample form |
| Agree the specification and sign | A sales contract with the factory as seller | By email |
| Pay as the contract says | The factory's confirmation | Factory's bank account |
| Ask for photos or videos if you want them | Updates from one contact | By email |
| Your forwarder books the vessel | Goods on board at Cat Lai | Port of loading |
| Check the set against the contract | Invoice, packing list, B/L, phytosanitary certificate, C/O | By courier |
Step 1: read the price before you ask for it
The price board shows an FOB price for every grade in USD per metric ton, with the date it last changed, and charts how each price has moved. These are indicative prices before packaging surcharges, and they follow the market. Use the board to shortlist grades and judge timing. The number you buy at is the one on the quotation.
Still choosing a grade? The guide to cashew kernel grades explains W240, W320 and W450, and the cashew kernels page lists every grade with its specification.
Step 2: the quotation and its Valid until date
The quote form asks for the product, grade, packing and tonnage, then FOB, CFR or CIF. As you type the tonnage, the form turns it into containers: a 40ft takes about 26 tonnes of cashew kernels and a 20ft about 13 tonnes.
We first email you a link to confirm your address. Once you confirm, the PDF quotation goes out at once if your grade has a published price. If one of your grades has no published price yet, we send the quotation within 24 hours.
The PDF carries a quotation number, the date, a Valid until date, the terms (for example FOB Ho Chi Minh City (Cat Lai), Vietnam), a line per grade with packing, quantity, unit price and amount, a container estimate, the documents provided and the payment terms. On cashew kernels a quotation holds its price for 7 days, so plan your internal approval around the Valid until date.
Ordering three or more containers, or after a long-term contract? Say so in the message box and we quote a volume price.
CFR or CIF instead of FOB
Pick CFR or CIF on the form and name your destination port. We add the ocean freight and send a CFR or CIF quotation, and a CIF quotation also lists an insurance policy among the documents. If you already have a forwarder you trust, FOB keeps the freight in your hands.
Step 3: free samples before you commit
On the sample form you can ask for up to three grades, 100 g to 1 kg of each. Samples are free, courier included, one parcel per address per month, because each one is a real shipment. You confirm your address by email, we pack the parcel within three working days and email you the tracking number.
Use the sample the way you would use a lot. Count the kernels in a pound of W320, look at the colour, the broken kernels and any spots, and send a portion for moisture if you have a lab. The contract specification guide shows which limits to measure and how to write them down.
Step 4: the contract and who signs it
Luason signs your sales contract as the authorized sales agent of the processing factory. The factory is the seller on the contract and the commercial invoice, and you pay the factory directly, so your money never sits with a middleman.
That is the answer for the finance manager in Lyon. The website, the quotation and your day-to-day contact are Luason. The legal seller, the issuer of the invoice and the holder of the bank account is the factory.
Illustration
Before the first transfer: three names, one company
Put three documents side by side:
- The seller named in the sales contract.
- The issuer named on the commercial or proforma invoice.
- The beneficiary on the bank details you were given.
All three must be the same company, the factory, and the contract should name Luason as the factory's authorized sales agent. If any name differs, stop and write to us before you send money. Five minutes here protects you from paying the wrong account, which is far harder to undo than a late shipment.
With the contract still open, check that the grade, standard, packing, quantity, unit price and Incoterm match the quotation you accepted.
Step 5: payment
The payment terms are printed on every quotation and repeated in the contract. In short, the money goes to the factory's account, either as a deposit followed by the balance or through a letter of credit, whichever the quotation and the contract name. Bank charges outside Vietnam are yours to pay. An FOB price also leaves out ocean freight, insurance and the duties and taxes at destination, since under Incoterms 2020 those sit with the buyer. The quotation confirms the exact terms for your order.
Whatever the method, the beneficiary is the factory. If the balance falls due against a scanned bill of lading, check that scan (step 8) before you pay. If the contract uses a letter of credit, the banks compare the documents with the credit, and the bill of lading has to show the goods shipped on board a named vessel at the port of loading the credit states. Have the credit name Ho Chi Minh City (Cat Lai) as that port and ask for the same documents the contract lists.
Step 6: production and inspection
The factory dries the kernels at 50 to 60°C for 6 to 8 hours to bring them to about 5% moisture, then grades them and packs them in vacuum bags, cartons of two vacuum bags or tins, whichever you chose. The packing and container guide covers how each pack travels.
You keep one contact from quote to loading. We follow production and send photos and videos of your order on request. Many importers also have an independent inspector sample the lot at the port of loading, as AFI recommends for every shipment. Who appoints the inspector, who pays and whether the certificate joins the shipping documents are agreed per order in the contract. Tell us what you need in your quote request and we will confirm it for your shipment.
Step 7: loading at Cat Lai and the moment risk moves
Under Incoterms 2020, FOB means the seller delivers the goods loaded on board the vessel nominated by the buyer at the named port of shipment and carries out the export formalities. The buyer contracts the ocean freight. On our orders the port is Ho Chi Minh City (Cat Lai), Vietnam.
On an FOB order your forwarder books space on a vessel and sends us the booking. The empty container goes to the factory, where it is loaded and sealed. The factory clears the goods for export, the container goes to the terminal at Cat Lai, and when it is lifted on board, the risk of loss or damage passes to you.
The ICC notes that containerised goods are usually handed over at the container terminal, not on board, so the box waits in the yard for a while before it is loaded. Ask your cargo insurer for cover that starts when the container leaves the factory, and the time in the yard is covered too.
The shipping page lists the port and the tonnes per container for each product.
Step 8: the documents
Every cashew quotation lists the documents provided, and the contract should list the same set.
| Document | Issued by | What to check |
|---|---|---|
| Commercial Invoice | The factory, as seller | Seller name matches the contract and bank account, grade, quantity, unit price, total, Incoterm |
| Packing List | The factory | Number of bags or cartons, net and gross weight, lot codes |
| Bill of Lading | The carrier or its agent | Shipped on board with date and vessel, port of loading Cat Lai, container and seal numbers, consignee and notify party as you asked |
| Phytosanitary Certificate | Vietnam's plant protection authority | Product and quantity match the invoice, any additional declaration your country requires |
| Certificate of Origin (C/O) | An issuing body authorised in Vietnam | The form your market needs for a preferential duty rate |
| Insurance Policy | The insurer | CIF orders only, value and cover as agreed |
The C/O form depends on the destination. Goods from Vietnam claim the EU-Vietnam Free Trade Agreement (EVFTA) rate with a C/O Form EUR.1, issued by the authorities listed in Circular 11/2020/TT-BCT of Vietnam's Ministry of Industry and Trade. The phytosanitary certificate follows ISPM 12, the international standard for these certificates, and some importing countries ask for an additional declaration on it. Name your destination and any such wording in your quote request, and we confirm the documents for your shipment before the contract is signed.
Once the balance has cleared, the original documents go to you by courier. Check them against the contract the day they arrive, while a typo can still be corrected before the ship docks.
Frequently asked questions
Who is the seller on a Luason cashew contract?
The processing factory. Luason signs the contract as the factory's authorized sales agent. The factory is the seller on the contract and the commercial invoice, and you pay the factory directly.
How long is a Luason FOB quotation valid?
On cashew kernels a quotation holds its price for 7 days, and the PDF prints the Valid until date. After that, ask for a new quotation at the current price.
When does the risk pass to the buyer under FOB?
When the goods are on board the vessel at the port of loading, Ho Chi Minh City (Cat Lai) on our orders. Your forwarder books the vessel, and your cargo insurance is best started at the factory.
Can I buy cashew kernels CFR or CIF from Vietnam?
Yes. Choose CFR or CIF on the quote form and name your destination port. We add the ocean freight, and for CIF the insurance, and send a CFR or CIF quotation.
Are cashew samples really free?
Yes. Up to three grades, 100 g to 1 kg each, courier included, one parcel per address per month, after you confirm your address by email.
Sources
- International Chamber of Commerce (ICC) Academy, Incoterms 2020: FAS or FOB?, FOB delivery on board, risk transfer, export formalities, containerised goods
- ICC Banking Commission, Recommendations in respect of the requirements for an on board notation (UCP 600 article 20)
- Association of Food Industries (AFI), Specifications for Cashew Kernels, inspection before loading
- International Plant Protection Convention (IPPC), ISPM 12 Phytosanitary certificates
- Deloitte Vietnam, Tax alert on Circular 11/2020/TT-BCT, rules of origin under the EVFTA, Form EUR.1 as proof of origin for goods from Vietnam
- RSM Vietnam, Tax newsbrief on EVFTA certificates of origin, issuing authorities of Form EUR.1
