File No. 611.9331/38
Minister Reinsch to the Secretary of State
Peking, January 16, 1917, 6 p.m.
Your telegram October 21, 4 p.m. After a long evasive correspondence the Chinese Government obstinately takes the position that although the exportation of grains and their products are alike forbidden by treaty, authorization to certain native mills to export a total of one million bags flour is justified on the ground that it is a special exception to enable limited quantity to be exported by reliable Chinese merchants for the relief of Chinese residents abroad.
In view of the influence of the interests involved I am not hopeful of terminating discrimination until the exhaustion of the remaining balance of approximately two hundred thousand bags unless by the use of strong pressure.
I beg to request the Department’s views as to the advisability of taking the position that the American company concerned will be supported in a claim for loss of prospective profits on the grain that it desired to export and that failing to receive satisfaction of the claim by other means our Government will insist on reference to arbitration to decide whether the action of the Chinese Government has not definitely cancelled its right to forbid grain exports.