File No. 611.326/175

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


Department’s September 20, 4 p.m. Your September 24, 2 p.m. As you know for the past two months conferences have been held in Washington between representatives of Great Britain, France, Italy, Brazil and the United States respecting the following matters:

Disposition of remaining German ships interned in Brazil and the placing of them in Allied service;
Liquidation of enemy interests in Brazil by the Brazilian Government with the assistance of Allied representatives;1
Assistance to Brazil respecting disposition of coffee holdings;
Protection of rubber interests of Brazil against competition with Straits rubber;
Elimination of published black list for Brazil;1
Financial arrangements to permit Brazil to meet her exterior obligations.

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The Allied and United States conferees have been industriously working on these problems and will probably be in a position to make proposals to the Brazilian Ambassador with respect to each of these matters some time next week.

While these discussions were being carried on, the Food Administration informed the Department that in order to control the distribution and sale of coffee in this country at reasonable prices, it is necessary for resolutions to be passed by the War Trade Board requiring that all licenses for importation of coffee from every part of the world shall be through the agency of the Food Administration and shall run in their name. This measure is not designed against Brazil any more than it is against Central America and Colombia, which are at the present time importing a large amount of coffee into the United States without restriction, except that imposed by shortage of shipping. The proposal of the Food Administration has been communicated to the Brazilian Ambassador and he has expressed concern and has stated that he feared that unless this action was properly explained to his Government, considerable embarrassment would be caused the, incoming administration and himself personally. The Ambassador stated that his Government and the incoming administration and he personally would be embarrassed if this action was taken by the Food Administration and the War Trade Board without first advising the Brazilian Government of the necessity therefor and of the fact that this action would be taken.

The reasons for the Food Administration’s action are the following:

Equitable distribution among merchants and the consuming public of coffee,
Preventing speculation, and
Effecting conservation where necessary on account of shipping space which will aid in the control of the price to the ultimate consumer.

You should at once seek an interview with the President, giving him the above as confidential information and stating to him that at the urgent request of the Brazilian Ambassador, this plan will not be announced to the public until publication of Saturday morning’s papers and will be put into operation at 9 o’clock Saturday morning1 on the express understanding that no publicity will be given to it either in Brazil or in the United States until that time so that merchants in both countries will not have an opportunity to speculate and anticipate this ruling.

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You should impress upon the President that this measure is not designed as an embargo on coffee from Brazil but that the unprecedented rise in the price of all coffee during the past weeks has made it essential for the Food Administration to obtain control over this commodity within this country. You should further point out to the President that the Allies and the United States expect to make proposals next week concerning the other matters mentioned above which will materially assist Brazil in this situation. Cable at once report of your interview.

  1. For further correspondence on this subject, see Supplement 2, pp. 341 et seq.
  2. For further correspondence on this subject, see Supplement 2, pp. 341 et seq.
  3. Oct. 12, 1918.