Indigenous shipowners have urged 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 said predictable cargo contracts could provide the commercial foundation required to finance and acquire vessels, arguing that sustainable fleet development must be anchored on cargo, contracts and reliable revenue streams.

Former President of the African Shipowners Association (ASA), Nigerian chapter, and Group Managing Director of Seamate Maritime Integrated Services Limited, Ladi Olubowale, made the case at a Public-Private Dialogue with chief executive officers 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.

Olubowale said Nigeria’s maritime development strategy should move beyond discussions about vessel ownership and focus on creating commercial conditions that make indigenous vessel acquisition bankable.

“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 said.

He explained that shipping was a capital-intensive business and that Nigerian operators could not sustainably acquire large vessels without predictable cargo volumes and bankable employment contracts.

He proposed reversing the conventional model in which shipowners acquire vessels before seeking cargo.

Instead, he said cargo should first be secured through credible long-term contracts, which could then support financing and vessel acquisition by qualified Nigerian operators.

According to him, the Dangote Group, with its expanding refinery, cement, fertiliser and industrial operations, generates substantial maritime cargo volumes and could therefore become a catalyst for domestic fleet development.

Olubowale proposed that the group allocate portions of its maritime cargo requirements to qualified indigenous shipping companies under structured, multi-year CoAs.

Such contracts, he said, 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 commitments.

He also drew attention to the continued participation of foreign-controlled vessels in the transportation of Nigerian crude and petroleum cargoes.

He said the solution was not protectionism without capacity, but the deliberate development of commercially competitive Nigerian shipping companies.

“There is no structural reason why Nigerian companies should not ultimately own and operate Suezmax tankers and other large commercial vessels. But fleet development must be connected to cargo, finance, technical capability and long-term employment,” he said.

Olubowale advocated a four-pillar model of Cargo, Contract, Finance and Vessel, under which cargo owners provide predictable volumes, long-term CoAs convert those volumes into bankable contracts, financial institutions fund commercially viable vessel acquisitions and indigenous shipowners provide vessels and technical management.