International Food Assistance: Cargo Preference Increased Food Aid Shipping Costs; Benefits Remain Unclear

Cargo preference laws require that a percentage of U.S. government cargo, including international food aid, be transported on U.S.-flag vessels according to geographic area, although the laws do not define "geographic area." One intention of these laws is to ensure a merchant marine - both vessels and mariners - capable of providing DOD sealift capacity in times of war or national emergency, including a full, prolonged activation of the reserve fleet. The reserve fleet is composed of those vessels owned by the U.S. government to meet logistic military needs that cannot be met by commercial vessels. Over the years, Congress has amended cargo preference laws to vary the CPFA percentage requirement. This testimony is based on an August 2015 GAO report that examined (1) CPFA's impact on food aid shipping cost and how U.S. agencies implement CPFA requirements; and (2) the extent to which implementation of CPFA requirements contributes to sufficient sealift capacity. It also provides an update on the implementation of actions recommended in the report.