Federation merchant ships, like Federation freighters, were specialized starships utilized by the Federation for hauling cargo.
In 2370, Cardassians living the in Demilitarized Zone attacked a Federation merchant ship using modified-Cardassian shuttles, before they were destroyed by the Maquis. The Cardassians later claimed that the ship refused to be boarded, and concluded that it was carrying weapons through the DMZ. The Federation, however, maintained that the ship was carrying medical supplies to Soltok IV. (DS9: "The Maquis, Part I")