Cargo Preference Act

Summary of Cargo Preference Act

A 1954 amendment to the Merchant Marine Act of 1936 which mandates that at least 50 percent of all government generated cargoes move on U.S. flag ships. Included in the category of such cargoes are Department of Defense movements, Department of Agriculture surplus commodities, goods financed by the Export-Import Bank, and Agency for International Development cargoes. Since World War II, approximately five percent of all goods shipped in U.S. foreign trade were preference cargoes. Attempts to expand the cargo preference to cover a percentage of U.S. oil imports were unsuccessful before Congress or were vetoed by the president in 1974, 1977, and 1978.

(Main Author: William J. Miller)