Dangote to buy ships for cement exports after failing to secure vessels

Dangote Cement says it will acquire its own ships for regional exports after struggling to find vessels willing to carry even 1,000 metric tonnes of goods to Ghana. The plan was disclosed on Tuesday by Sada Ladan-Baki, head of international trade export at Dangote Cement, at a seminar on non-oil exports.

Shipping shortage hits exporters

Ladan-Baki said the conglomerate has faced persistent difficulties moving products across West Africa using existing shipping options. "We are moving forward towards getting our own ships to do this business," he said.

He noted that no shipping operator was willing to take cargo as small as 1,000 metric tonnes on the Nigeria-Ghana route. "As of today, you cannot get a ship that will take your goods from here to Ghana. None. And that is for 1,000 metric tons, what the small traders and the business people can do."

Dangote Cement has exported cement for 16 years and has an annual production capacity of 50 million metric tonnes. The company currently relies on trucks to deliver goods to Ghana, Togo and Ivory Coast. It has assembled about 7,000 trucks to support distribution across West and Central Africa, but Ladan-Baki said maritime transport could offer a more cost-efficient alternative.

Road taxes hurt competitiveness

The executive said taxes along regional road corridors erode the price competitiveness of Nigerian products. "If we are going to export our cement from here to Ghana, we have to pay Value Added Tax of 18 percent in Benin. We pay in Togo. We pay another 18% if we are going to Ivory Coast," he said, adding that these charges accumulate before goods reach their final destinations.

Nigeria's National Shipping Line ceased operations in 1995 after 36 years, leaving the country's international freight largely in the hands of foreign operators. Some Nigerian conglomerates have moved to fill the gap. BUA Group, owned by Abdul Samad Rabiu, took delivery of two vessels in 2022 to cut costs on sugar exports to West Africa.

Dangote Group already operates port terminals at Onne and Apapa and has maritime infrastructure, including a jetty at Lekki, Lagos, to support its $20 billion refinery.

Call for government support

Ladan-Baki called on the government to activate Nigeria's $700 million Cabotage Vessel Financing Fund, established to help Nigerian operators acquire ships. "We can only succeed if our two hands are clapping. We will only be happy if the country is self-sustaining in terms of shipping," he said.