Pirates want a $20m ransom for the ship and its cargo
Somali pirates who hijacked a Ukrainian ship laden with 33 Soviet-made battle tanks are negotiating with the ship's owners, says the Somali government.
Mohamed Jama Ali, from Somalia's foreign ministry, said no other parties were involved in the negotiations.
Pirates are demanding a $20m (£11m) ransom for the Faina, which was carrying T-72 tanks, rifles and heavy weapons when it was seized last week.
A Russian frigate is approaching the area to join an international blockade.
The ship is now surrounded by US warships that are not allowing the pirates to take the weapons off the ship.
The Russian Novosti news agency is quoting a navy official as saying that the warship heading for the area is carrying marines and special forces commandoes on board.
The interim government, which controls the capital and some areas of the south and central of the country, has approved action by foreign forces to free the ship and its cargo.
"The international community has permission to fight with the pirates," Mr Ali said.
Earlier, the East African Seafarers' Association urged international community to "cool off" so as not to endanger the lives of the crew.
One of the ship's 21 crew is reported to have died from an illness on board.
On Tuesday, it was reported that the pirates had fired at each other. But the pirates denied this and said they were optimistic that a peaceful resolution could be reached.
The Faina is currently moored off Somalia's coast close to the town of Hoboyo. There have been conflicting reports of where the Faina and its cargo were destined.
Kenya has insisted that the shipment was destined for its military.
But other sources, including a US navy spokesman, said it was bound for the autonomous government of South Sudan, in possible contravention of a peace accord.
Somalia has been without a functioning central government for 17 years and has suffered continual civil strife, with rival armed clans and groups fighting for control.
The waters off its coast are considered to be some of the world's most dangerous - pirates have hijacked nearly 30 ships this year and attacked many more.