File No. 825.6374/65

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


Replying to your December 8, 10 and 11,1 you are authorized to sign on behalf of the United States the proposed nitrate agreement [Page 681] as reported by you on the following understanding, to be previously notified by you to the other parties.1

  • Clause 1: The control of the Executive shall not cover negotiations with the Chilean Government regarding German oficinas, with which the Government of the United States reserves the right to deal on the basis outlined in the 6th paragraph, Department’s December 4,2 it being understood that all nitrate so secured will go into the pool. These negotiations are dependent upon supplying oil from the United States, and financial arrangement under discussion between the United States and Chile, and other considerations which make it essential that they should be under the direction of the United States Government.
  • Clause 2: The United States Government hopes that the Japanese Government will be represented upon the Executive and will make representations to that effect through the American Ambassador at Tokio.3 Your suggestion about an active delegate and substitute is approved.
  • Clause 3: The purchase of the amount required for use in the United States will be made by Dupont, Grace, Wessel Duval, and Gibbs in proportion to their proper share of United States imports under instructions from the Executive communicated to them from time to time through the director of purchases, and each of these firms will carry through in the usual way, on its own credit, the purchases made by it, subject to adjustment of price on pooling basis. The reason for this arrangement in the case of the United States is that we have no available appropriation with which to finance these purchases, except the Agricultural Department’s appropriation for its 100,000 tons, and it is essential that these transactions should be financed and carried out through the usual business channels.
  • Clause 5: The approximate estimate already notified to the Executive of 1,800,000 tons required for use in the United States next year is not to be subject to reduction by the Executive without the consent of the United States Government. This reservation is made necessary by reason of the new provision subjecting this estimate to the approval of the Executive. In this connection it will be noted that this estimate is less than 600,000 above the 1916 United States importations, and 500,000 tons of this increase are required for munitions, in the increased production of which all of the Allied powers are interested, and 90,000 tons for sulphuric acid and fertilizers, the use of which in this country is for the mutual benefit of all concerned.
  • Clauses 10, 11 and 14: See statement under clause 3 and previous general instructions, and also Department’s December 4, paragraph 3, as supplemented in its December 61 and your December 8.1

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  1. The telegram of Dec. 11 not printed.
  2. In his telegram, Dec. 20, 1917, 11 a.m., the Consul General reported: “Nitrate agreement signed December 19.” (File No. 825.6374/69.)
  3. Ante, p. 676.
  4. In his telegram, Jan. 16, 1918, 12 noon, the Consul General reported: “Japan joins Nitrates Executive.” (File No. 825.6374/95.)
  5. Ante, p. 677.
  6. Ante, p. 677.