Cargo Preference
Welcome to the Maritime Administration's Office of Cargo Preference and Domestic Trade (Office) web site. The Office's primary focus is to promote and monitor the use of U.S.-flag vessels in the movement of cargo on international waters. The office is composed of three sections: Agricultural Cargoes, Civilian Agencies, and Military Cargoes. Information related to these three sections may be accessed by the appropriate links below. In addition, links to Government and private entities have been provided for your viewing. However, it should be noted that the Office only accounts for the accuracy of information on its web site.
To fully understand the movement of cargo, let's first define:
What is Cargo Preference?
The Cargo Preference program works to promote and facilitate a U.S. maritime transportation system that is accessible and efficient in the movement of goods and people. It oversees the administration of and compliance with U.S. cargo preference laws and regulations. Those laws require shippers to use U.S.-flag vessels to transport any government-impelled oceanborne cargoes.
What is Government-impelled cargo?
Government-impelled cargo is cargo that is moving:
- Either as a direct result of Federal Government involvement
- Or, indirectly through financial sponsorship of a Federal program
- Or, in connection with a guarantee provided by the Federal Government
Why Do We Have Cargo Preference?
To provide a revenue base that will retain and encourage a privately owned and operated U.S.-flag merchant marine because the U.S.-flag merchant marine is a vital resource providing:
- Essential sealift capability in wartime or other national emergencies
- A cadre of skilled seafarers available in time of national emergencies
- Help to protect United States ocean commerce from total foreign domination and control
What percent of cargo is required to be carried on U.S.-flag vessels?
- Military Cargo = 100% (governed by Military Cargo Preference Act of 1904);
- Export Import Bank = 100% (governed by Public Resolution 17);
- Civilian Agencies Cargo = at least 50% (governed by Cargo Preference Act of 1954); and
- Agricultural Cargoes = at least 75% (governed by the Food Security Act of 1985)
What is the Process?
The process is framed below:
- Shipper/cargo interests identify potential cargo move.
- Fully identify cargo to be shipped to extent possible.
- Identify timeframe for expected move to extent possible.
- Shipper must work in advance with potential U.S.-flag carriers and with the Maritime Administration, and must solicit U.S.-flag carriers as listed on the following web site: Listing of U.S.-Flag Carriers.
- Evaluate U.S.-flag carrier responses as to availability and cost.
- Book the cargo on a U.S.-flag vessel or contact the Maritime Administration (1- 800-9US-FLAG [987-3524]; or (202) 366-4610; Email: cargo.marad@dot.gov) for assistance.
- File required reports (bill of lading) with the Maritime Administration.