The Nigeria shipping market has undoubtedly evolved overtime, however, it still faces challenges mitigating against its development. It is a market comprising various stakeholders performing distinct functions that aid in developing the maritime sector. Generally, there are four closely knit shipping markets namely;
1) The Freight Market: The freight market is made up of shipowners, charterers and brokers, utilizing four distinct types of contractual agreement: the contract of affreightment, the voyage charter, the bareboat charter and the time charter.
2) The Sale and Purchase Market: Stakeholders in the sale and purchase market include; shippers,
shipping companies, shipbrokers, and spectators.
3) The Demolition Market: The demolition market known as ship dismantling, ship cracking or ship recycling involves the breaking up of ships for either a source of parts, which can be sold for re-use.
4) The New Building Market: The new building market brings new ships into the shipping industry and sends cash out of the market as materials, labour and profit. The Nigeria shipping market is involved in trading ships that are not yet built. Therefore, once a ship is ordered, it will take up to four years to get ready for its sea trials. By this time the entire market conditions may have been changed. Hence, it is crucial to have good prediction of the future before ordering. Reasons for a buyer to choose to order a new vessel instead of buying a pre-owned one can vary, but in most cases it depends on the prices and also depends on the
owners design criteria.
The Shipping Cycle
Basically, shipping is a cyclical and seasonal business. The shipping cycle is a mechanism to balance the supply of and demand for ships. If excessive demand exists, the market rewards investors with high freight rates until more ships are built. If there is excessive supply, the market squeezes the revenue with low freight rates until ships are scrapped
Influence of Maritime Laws and Policies on Shipping in m Nigeria.
1) Regulates the activities of stakeholders and key players in the industry: Nigeria’s maritime laws
help to regulate the activities of key players in the industry as it stipulates the modus operandi and
all that is obtainable for port operations to take place in the country.2) It regulates registration and licensing: The registration and licensing of ship operators, freight
forwarders, logistics managers and various other stakeholders in the maritime industry is contained
in the body of laws governing the sector.
3) It stipulates procedures for shipping and shipping contracts: The procedures for shipping and
shipping contracts are enshrined in the maritime laws.
4) It Promotes Indigenous Participation: The Cabotage Act particularly promotes indigenous
participation and port concession.
5) It covers Maritime Insurance: Individuals, bodies and organizations that regularly engage
in the use of marine transportation are required to obtain maritime insurance . It covers
for losses that may occur as a result of marine adventures, from the use of vessels and
yachts as a means of transportation, as encapsulated in the Marine Insurance Act