Memorandum by the Assistant Chief of the Division of European Affairs (Henderson)

Mr. Oumansky called upon me today in order to say goodbye before departing for Europe. He said that he had just had an interesting conversation with the Secretary, and that during this conversation, acting under instructions received from Mr. Molotov, he had proposed that since the Soviet Government was obligating itself to buy forty million dollars worth of American merchandise annually, the American Government might undertake to purchase every year for a period of four years 200,000 tons of Soviet manganese.

Mr. Oumansky said that if the American Government should make such purchases, the total value would amount to about $12,000,000, less than one-eighth of the value of raw materials which Congress had authorized the Government to buy during the next four years.

He pointed out that the value of Soviet purchases of American goods during the year ending June 30 would probably amount to between fifty and fifty-five million dollars, and would therefore be considerably in excess of the purchases which it had promised to make, whereas American imports from the Soviet Union had declined and would probably be little more than $20,000,000 in value.

I told Mr. Oumansky that I regretted the falling off of American purchases from the Soviet Union and drew his attention to the fact [Page 819] that this decline was to a considerable extent due to the Soviet policies of curtailing exports of certain commodities rather than to a decline in the demand for such commodities in this country. I told him that I understood, for instance, that the American importers of timber, fish, anthracite and furs had been deeply disappointed because of the decision of the pertinent Soviet export organizations to cut down the allotments of those commodities set aside for export to the United States.

Mr. Oumansky agreed that the reduction of Soviet exports to the United States was partly due to Soviet foreign trade policies, but stated that so far as manganese is concerned the Soviet Government had plenty to export and desired to be assured of a steady American market.