Syngenta, a global agtech company that handles seeds, pesticides, insecticides, fertilizers and other chemical products, operates a supply chain focused on safety, speed, and ease of shipping.
To import agrichemical cargo from South Korea into Bangladesh, Syngenta requires a letter of credit to both comply with regulations and finance the transaction. Traditionally, it is a manual, paper-based process:
Step 1
An Original Bill of Lading (OBL) is couriered from the carrier, Sealand to the client’s operational base in Singapore, and from there to their bank in Singapore (HSBC);
Step 2
Other trade documents in support of the shipment (the commercial invoice, packing list, certificate of origin and certificate of analysis) and letter of credit are included in the same document pack;
Step 3
Clerks at HSBC Singapore review the documents for compliance with the letter of credit requirements and to catch any discrepancies. After a successful review, the document pack is couriered to the importer’s bank in Bangladesh;
Step 4
The Bangladeshi bank reviews the documents, and if all is in order, the documents are sent to the importer;
Step 5
When the cargo is available for pick-up, the importer ‘surrenders’ the OBL by physically providing it to the carrier in order to secure the cargo release (without it, the cargo isn't released).
Step 6
If either of the banks identify an error, the documents are returned to Syngenta for revision and resubmission.
This movement and handling of paper documentation was taking 20–25 days to complete. If the documents were delayed, the importer was unable to surrender the OBL to the carrier when the cargo arrived in port. This would lead to additional costs, including possible detention and demurrage, inventory management issues and loss of sales.
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