The ship, carrying people and goods, had left Nacala port at 15:30 local time on Thursday for Memba district in northern Nampula province, according to state broadcaster Radio Mozambique.
It’s believed that the accident was caused by bad weather, which affected the region on Thursday afternoon.
Some reports say 17 of the people who were on board survived by swimming ashore.
Memba district police commander, Manuela Parula, last night confirmed the incident.
He said a team of health personnel, the police and local leaders were on the ground.
A rescue and search teams were looking for bodies so that they could ascertain the number of the victims, he added.
He said they had learnt about the incident from community leaders, noting that the accident area had a weak communication signal that delayed getting the details.