Merchant Ship

Merchant Ships were introduced with the High Seas booster. NPC Humans sail Tokuno Ships while Gargoyles use their native Gargoyle Ships. The crew consists of 3-5 NPCs which always include a captain and usually a navigator and some deckhands. Each will have ranged weapons or bard/spell-casting abilities(including Chivalry, a first for NPC's).

Scuttling

You can scuttle the ship with Cannons and Cannonballs. Once the ship is scuttled you can board the ship (or cast summons from your ship) and access the hold and on deck containers.

Merchant ships have blue NPC's and killing them will negatively effect your karma and fame. Be sure to avoid the Grapeshot ammunition if you want to avoid hurting the NPC's. If you do not attack the NPC's they will not attack you.

The crew may be attacked at any time and popular tactics include using Greater Explosion Potions and Greater Conflagration Potions as well as ranged attacks with spells, Archery and Throwing. Killing the crew one by one and then focusing on scuttling the ship with cannonfire is a common strategy.

Making passes past the ship while releasing a broadside, then reloading out of range and turning to make another pass is common. Shooting cannons at the stern(rear) of the ship is also common as it is difficult for the ship to return fire with no cannons pointed to the rear. Blocking the ship up against something, like an island or another ship, will help immobilize and trap it but may take some practice to master the technique, as well as knowing suitable areas for the tactic.

Resources

Several resources can be plundered from the merchant ship, usually in stacks of 50 for items kept on the deck in Containers, totalling up to around 2,300. Common items from the Hold usually amount to 7-10 items each, one swab and one ramrod, and 25-30 matches.

Hold

Fuse Cords
Cannonballs
Grapeshot
Powder Charges
Cannons: Culverin or Carronadeds (uncommon)
White Cloth Dye Tub (uncommon)
Maritime Trade Cargo

Containers

Food items(ears of corn, hams, sacks of flour, etc.)
Ingots (All types, can also spawn as Ores)
Boards (All types except Frostwood, can also spawn as Logs)
Leather (All types, can also spawn as Hides)
Liquor Smuggler's Cache
Crabs & Lobsters
Maritime Trade Cargo

Notes

Perhaps controversially, there are no gold nor magic item drops in merchant ship loot except for what the NPC crew might be carrying. With the high outfitting and repair cost of galleons needed to intercept merchant ships and only the rewards that seemingly interest crafters, merchant ships seem to only attract players interested in crafting or selling the loot.