File No. 611.326/135

The Ambassador in Brazil ( Morgan) to the Secretary of State


Press despatches reporting Food Administration’s campaign to reduce consumption of coffee in the United States have produced drop in prices at Santos and consternation in Sao Paulo. State authorities have appealed to Foreign Office and Embassy, explaining that the State’s financial position, already jeopardized by recent [Page 720] frost, which will reduce production for the next few years from between 12,000,000 and 14,000,000 sacks to between 4,000,000 and 6,000,000, will become pitiable if the only market for Brazilian coffee is closed.

Cannot compensation be arranged, such as the purchase of coffee in Brazil for consumption of American forces in Europe, transportation being afforded by French steamship lines which have recently increased their service to two boats per month?

If Brazil’s financial situation is further complicated, the effort to arouse and prepare public opinion to send troops to Europe will be checked. The sending of these troops appears favorable, essential to interesting Brazilian people in the war to the extent which is desired.