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Promotional Programs » Cargo Reservation

Preference for national-flag ships to move national cargoes in international trade is a policy pursued by many maritime nations. The Maritime Administration maintains on its website, www.marad.dot.gov, a listing of U.S.-flag vessels eligible to transport preference cargoes as well as a listing of carriers with contact information. U.S. cargo policies include the following:

• The Cargo Preference Act of 1904 requires all cargoes procured for or owned by the military services to be carried exclusively on U.S.-flag vessels.
• Public Resolution 17, enacted in 1934, requires that all cargoes generated by the Export-Import Bank (Eximbank) be shipped on U.S.-flag vessels unless a waiver is granted by the Maritime Administration. The agency may grant general waivers permitting up to 50 percent of the cargo generated by the individual loan to be shipped on vessels under the flag of the recipient nation. It also may grant statutory waivers permitting a specific shipment to be made on a foreign-flag vessel if a U.S.-flag vessel is not available at a reasonable rate, or if the vessel cannot accommodate the cargo.
• The Cargo Preference Act of 1954 requires that at least 50 percent of all government-generated cargo subject to the law be transported on privately owned, U.S.-flag commercial vessels available at fair and reasonable rates. The Food Security Act of 1985 increased the percentage of the U.S.-flag tonnage requirement from 50 to 75 percent of agricultural cargoes under certain foreign assistance programs of the Department of Agriculture and the Agency for International Development.