New Zealand's Associate Transport Minister James Meager has denied an application from NovaAlgoma Cement Carriers (NACC) to use a foreign-flagged ship on domestic coastal routes. Maritime unions see this decision as a win for local jobs and the stability of supply chains.

This ruling stops NACC from using the Panamanian-flagged and internationally crewed NACC Vega to take over the route currently served by the New Zealand-flagged and crewed MV Buffalo, which transports cement for Holcim. The application was seeking an exemption under Section 198 of the Maritime Transport Act.

Carl Findlay, the National Secretary of the Maritime Union of New Zealand (MUNZ), praised the minister's choice, saying it sends a strong message about protecting local jobs. "This is a win for local jobs and New Zealand shipping," Findlay said. "Holcim must now realize that their plan to replace experienced New Zealand crews with foreign workers has failed. The skilled crew of the MV Buffalo is ready and able to keep serving New Zealand's coastal distribution network."

The International Transport Workers’ Federation (ITF) also supported this decision, viewing it as part of a global movement to strengthen maritime cabotage protections. Chris Given, Chair of the ITF Cabotage Task Force, highlighted the dangers of weakening national maritime workforces. "This decision reinforces what our international research shows: foreign-flag shipping should not replace a country's maritime workforce," Given said.

This conflict arose after Holcim announced job cuts for 32 New Zealand seafarers on the MV Buffalo in November, following their contract with NACC to transport cement for three years. MUNZ has urged Holcim to better support New Zealand shipping and keep local jobs.

The issue shines a light on Flag of Convenience (FOC) shipping, where shipowners register their vessels in foreign countries to evade labor laws, tax responsibilities, and safety standards. Critics argue that FOC operations create "floating sweatshops" with minimal worker protections and undermine ethical operators.

Maritime advocates warn that FOC shipping is a threat to New Zealand's economic independence, biosecurity, and local employment. This practice enables multinational corporations to replace domestically flagged and crewed ships on coastal routes, weakening the country's maritime capabilities.

MUNZ stresses that this situation highlights the vulnerabilities in New Zealand's maritime trade and the urgent need for a strong policy to rebuild the domestic coastal shipping fleet. "New Zealand needs a solid and lasting policy framework to rebuild a dedicated coastal shipping fleet, crewed by New Zealanders, ensuring safety and resilience in our supply chains," Findlay stated.

The union pointed out the crucial role played by domestic shipping during national emergencies like the Christchurch and Kaikōura earthquakes and Cyclone Gabrielle as proof of the need for a strong national maritime capability.

Founded in 2016 through a joint venture between Nova Marine Carriers SA of Luxembourg and Algoma Central Corporation of Canada, NovaAlgoma operates three fleets, including NovaAlgoma Cement Carriers. The company aimed to secure the Holcim contract using its foreign-flagged vessel instead of the existing New Zealand-crewed option.

The Maritime Union has expressed eagerness for continued discussions about the future of the maritime industry with Associate Minister Meager starting in the new year.