CUEX Metal AG and Caravelle International Group Sign Innovative Manganese Ore Purchase Agreement to Advance Wood Drying Business

19 April 2024

Caravelle International Group  a leading global marine technology group of companies, today announced the signing of an innovative manganese ore sourcing agreement with CUEX Metal AG ("CUEX"), a leading provider of services to the global steel, foundry and smelting industries.

This partnership not only ensures CUEX's stability in the global manganese ore supply chain, but also marks a substantial step forward in the cooperation between the two companies in the wood drying business. CUEX has built an outstanding reputation in the metals market for its insistence on quality and pursuit of innovation, and with a wide range of services that include not only the supply of key raw materials for steel manufacturing, but also cover a wide range of segments such as casting and smelting, CUEX is committed to providing comprehensive metals solutions to its customers around the world.

Under the agreement, Caravelle will supply a total of 4.5 million tons of high-quality manganese ore to CUEX through its subsidiary, Singapore Garden Technology Pte Ltd ("SGT"), with supply schedules of 1.0 million tons in 2024, 1.5 million tons in 2025 and 2.0 million tons in 2026. The manganese ore must be of stringent quality, with manganese content (Mn content) at or above 38% to meet CUEX's high standards for raw materials. Prices will be negotiated based on international market prices and a written single purchase and sale agreement will be formed to ensure transparency and fairness of the transaction.

CUEX will pay the full amount through an irrevocable letter of credit, demonstrating its financial strength and trust in its partners. The delivery terms follow the CnF (Cost plus Freight) clause of Incoterms 2024, which guarantees the smooth delivery of the goods to the port designated by CUEX, SGT will be responsible for the transportation of the goods to the designated port and bear all the costs and risks in the process of transportation, and CUEX will need to take out full marine insurance for the goods to ensure the safety of the transportation process. CUEX is required to insure the goods with sufficient marine insurance to protect the safety of the goods during transportation.

The highlight of this cooperation is an innovative business model that the two companies have explored together: the transportation of manganese ore and the drying of wood on the same carrier. This model not only improves transportation efficiency and output and reduces logistics costs, but also opens up new market opportunities for Caravelle's wood drying business. Through this innovative synergistic approach, the two companies are optimizing the allocation of resources, promoting environmental sustainability and generating additional economic benefits, Caravelle expects to earn close to $400-500 million annually through the partnership with CUEX, which includes the combined revenues from the trade and transportation of manganese ore and the trade, transportation and drying of timber. Caravelle's total revenues are expected to be in the range of $1.2 billion to $1.5 billion over the three-year term of the partnership.

CUEX officially expressed the cooperation with Caravelle not only provides a stable supply of manganese ore, but also opens up new possibilities to explore our business in the field of wood drying. They look forward to creating more value for our customers through this innovative partnership model." Caravelle's Chairman of the Board of Directors and CEO, Dr. Guohua Zhang, also expressed a positive attitude towards the partnership, "We are pleased to establish a long-term relationship with CUEX and contribute to the development of the global steel industry through our professional services."

The partnership between CUEX Metal AG and Caravelle International Group is an important step in the strategic deployment of the two companies in the global manganese ore supply chain, and heralds the beginning of a mutually beneficial business journey for both companies. As the cooperation continues, it is expected to bring more innovation and development opportunities to the global steel and wood processing industries.