File No. 600.119/268

The Secretary of the British Embassy ( Percy) to the Assistant to the Counselor for the Department of State ( Auchincloss)

Dear Mr. Auchincloss : May I write you a word about the pyrites situation which I know is causing Mr. Polk some anxiety in connection with the question of Spain and shipments of coal to that country.

We had yesterday a conference at the Department of Commerce, where I think all the interested parties were present. You will doubtless hear the results of that conference from Doctor Pratt,1 but I think I may say that our discussion showed two things: first, that the present rate of imports is higher than had been supposed, and secondly, that there is no reason to suppose that our Ministry of Shipping cannot help you out with sufficient ships for your needs in the immediate future. We have already, about a fortnight ago, placed at your disposal four ships—the Clara Mennig and Armenian and two others—for this trade. Besides the ships we control, there are those controlled by the French and Italian Governments which can be called on in case of need to bring cargoes from Huelva on the westward voyage. There is, further, a possible margin in the fact that the United States appears recently to have been taking much more iron ore from Spain and much less than usual from Sweden. We can probably enable you to carry far more ore from Sweden, thus relieving the pressure on the tonnage between this country and Spain. Meanwhile, the Spanish Government is, so far as we know, placing no difficulties in the way of the export of pyrites, so that that Government is not in a position to offer any remedy to the situation. The real remedy appears to be that we should rely on our joint coal pressure, imposed silently and without threats as a measure of conservation of resources, to bring Spanish tonnage speedily into the Allied market, as proposed in the Cortina agreement; and that you should rely, during the intervening period before this pressure becomes effective, on yourselves and your allies to provide the necessary tonnage to tide over your immediate needs. I feel sure we can meet the situation in this way.

With apologies for troubling you with these views,

Yours sincerely,

Eustace Percy
  1. Edward E. Pratt, Chief, Bureau of Foreign and Domestic Commerce, U. S. Department of Commerce.