Nigerian indigenous shipowners have renewed their call for major cargo owners, particularly the Dangote Group, to support domestic fleet development through long-term Contracts of Affreightment (CoAs) covering petroleum products, cement, fertiliser and other bulk commodities.

The shipowners hinged their call on the principle of shipping economics: cargo creates trade, trade supports financing, and predictable cargo contracts enable shipowners to acquire vessels and build sustainable fleets.

Captain Ladi Olubowale, former president of the Nigerian chapter of the African Shipowners Association (ASA) and Group Managing Director/CEO of Seamate Maritime Integrated Services Limited, made the call during a Public-Private Dialogue with CEOs, organised by the Nigerian Chamber of Shipping in Lagos.

The dialogue, themed: “Unlocking Efficiency in the Marine and Blue Economy Value Chain”, brought together maritime industry leaders, cargo owners, terminal operators and policymakers, with Mr Edwin Devakumar, Group Vice President of Dangote Group, participating as the guest CEO.

Captain Olubowale argued that Nigeria’s maritime development strategy should move beyond simply discussing vessel ownership and focus instead on creating the commercial conditions that make indigenous vessel acquisition bankable.

He said, “Shipping follows cargo. Give credible Nigerian shipowners long-term Contracts of Affreightment, and those contracts become the commercial foundation upon which vessels can be financed, acquired and deployed.”

He explained that shipping is fundamentally a capital-intensive private-sector business and that Nigerian shipowners cannot sustainably acquire large vessels without predictable cargo volumes and bankable employment contracts.

Rather than waiting for indigenous companies to first acquire vessels before giving them cargo, he proposed reversing the model: secure the cargo, establish credible long-term contracts, structure the financing, and allow qualified Nigerian operators to acquire vessels against those contracts.

According to him, for Dangote Group, whose expanding refinery, cement, fertiliser and industrial operations are generating substantial maritime cargo volumes, this could provide an opportunity to become an important catalyst for Nigerian fleet development.

Olubowale proposed that Dangote consider allocating portions of its maritime cargo requirements to qualified indigenous shipping companies under structured multi-year CoAs.

He noted that such arrangements could enable Nigerian shipowners to approach banks, development finance institutions, export credit agencies, leasing companies and international vessel financiers with identifiable cargo, predictable revenues and long-term commercial contracts.

From cargo contracts to national fleet capacity, Captain Ladi Olubowale also drew attention to the continued participation of foreign-controlled vessels in the transportation of Nigerian crude and petroleum cargoes.

He noted that large tankers, including Suezmax vessels, regularly call at Nigerian crude terminals such as Forcados, Bonny and Escravos, generating significant freight revenues from Nigerian-origin cargo. (Nigerian Tribune)