561.311F1/167: Telegram
The Ambassador in Great Britain (Bingham) to the Acting Secretary of State
[Received July 28—1:10 p.m.]
228. For Wallace from Morgenthau. “Beginning July 18 daily discussions have been held by overseas and Danubian exporters with European importers jointly in committee and individually in private. In view of limited time available discussions were directed toward reaching agreement on general principles upon which importers would [Page 817] cooperate with aim of thus enabling exporters to put their plan into effect. Following principles proposed by exporting countries:
- (1)
- Not to increase acreage or encourage expansion in production.
- (2)
- Employ all possible means increase consumption particularly removal measures lowering quality breadstuffs.
- (3)
- Reduce tariffs as prices rise.
- (4)
- Relax all forms restrictions on wheat imports including milling quotas in order to increase international trade in wheat and restore more normal relations between imports and consumption. Little relaxation expected this year but effective alteration 1934–35.
- (5)
- Refrain from subsidized exports.
- (6)
- Renounce regional cereal preferences upon entry into force of international wheat agreement.
- (7)
- Having agreed to the above principles to discuss detailed arrangements later.
Conversations revealed advisability dropping points (5) and (6). Importers generally insisted on principle of having outlet for domestic production at remunerative price without definite obligation reduce acreage but appeared prepared undertake tariff reduction and gradual relaxation restrictions when world prices rose provided above conditions met. Was impossible complete discussions or reach general agreement before Conference adjournment although France appeared prepared cooperate fully, Austria, Czechoslovakia and Switzerland favorable, Italy some reservations, Germany refused make definite commitment but expressed willingness continue negotiations later, Great Britain full cooperation consistent with wheat act. However, in joint Drafting Committee yesterday Bennett nearly broke up discussions by objecting to European insistence on remunerative prices but finally he agreed that evidence European desired cooperate was sufficient justify further negotiations at adjourned meeting London, August 21.”