Why Do Document Discrepancies Cost Commodity Traders So Much?

A vessel arrives at port. The bill of lading says 50,000 MT. The contract says 49,500 MT. The letter of credit has a 0.5% tolerance. Is this a problem?

It depends on who catches it first.

The Hidden Cost of Mismatches

Document discrepancies in commodity trading rarely stay small. A quantity mismatch can trigger LC rejection, forcing renegotiation while the vessel sits at port accumulating demurrage. A pricing error discovered post-shipment means difficult conversations with counterparties. A wrong port code delays customs clearance.

The direct costs add up quickly: demurrage fees of $20,000-50,000 per day, bank fees for LC amendments, expedited shipping for corrected documents. But the indirect costs are often worse: damaged relationships, missed market opportunities, and the constant stress of wondering what might slip through.

Why It Keeps Happening

The root cause isn't carelessness. It's complexity. A single cargo might generate 15-20 documents across multiple parties. Each document is created independently, often by different people using different systems. There's no single source of truth, just a stack of PDFs that someone has to manually cross-reference.

Operations teams do heroic work catching discrepancies, but they're fighting against the odds. Fatigue, time pressure, and sheer volume mean that errors will slip through.

How Mercora Addresses This

Mercora processes every document the moment it arrives. Our AI extracts key fields and automatically cross-references them against the trade record and other documents. Discrepancies are flagged immediately, before they become expensive problems.

Instead of spending hours on manual reconciliation, operations teams see a clear dashboard of what needs attention. No more hoping someone catches the mismatch. No more late-night scrambles when a bank rejects an LC.

Get in touch to see how Mercora can protect your trades.