File No. 825.6374/63

The Consul General at London ( Skinner) to the Secretary of State


Department’s 4th. First. Nitrate Executive have invited Japanese participation. British Foreign Office has instructed Ambassador Tokio to support invitation. Similar action on the part of United States recommended. Second and third. Provided American [Page 678] Government agrees (and it has authorized me so to agree), to include the American house of Gibbs with the other firms named to acquire such quantities of nitrate of soda as may be allocated to the United States by the Executive, the proposal formulated under Nos. 2 and 3 is accepted. Under this proposal Herbert Gibbs, resident member of firm, will be appointed director of purchases and will act under instruction of Executive. Gibbs’s share of American orders will be reduced to extent of Grace’s European trade. Unadvised Grace has executed European orders since war. Fifth. All purchases already contracted for are pooled as to quantities but not necessarily as to prices. Sixth. It is improbable that maximum production can be moved in which event operation of German establishments not desirable but whole question in abeyance pending definite constitution of Executive when matter will be taken up and dealt with. Seventh. Bags for Chilean Government will be dealt with when decision reached as to German establishments. Eighth. Ministry of Shipping undertakes to transport up to 300,000 tons coal to Chile provided United States will provide what fuel oil is still required. Ninth. Gibbs will supply 79,000 tons for Agricultural Department at 12 shillings meeting Department’s wishes.

In reply to Department’s 6th,1 Gibbs will lend Duval 3,500 tons for Mexicanos for immediate loading adjusting later from pool. Munitions Board of Canada required 48,000 tons for delivery January to May and owing to delay in formation of Executive Gibbs was authorized to supply about 8,000 tons to the end of January which will come out of pool.

Draft of agreement will be cabled Monday.

  1. Not printed.