Nautical Term: COA
Definition of COA
A Contract of Affreightment (COA) is an agreement between cargo owners and a shipping company, whereby the cargo owners commit to purchasing cargo capacity for a specific quantity of cargo, at a predetermined cost per revenue ton for each voyage. Here’s an example of how COA might be used in a single paragraph:
The shipping company entered into a Contract of Affreightment (COA) with the soybean exporters. Under the terms of the COA, the shipping company agreed to transport 50,000 metric tons of soybeans from the exporters’ warehouses in Brazil to their customers’ facilities in China. The shipping company charged the exporters a cost of $30 per revenue ton for the cargo carried on the 15 round voyages required to transport the entire 50,000 metric tons of soybeans.
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