The Secretary of State to the Ambassador in the United Kingdom (Bingham)
182. Viles, President of the Rubber Manufacturers Association, will attend the forthcoming meeting of the International Rubber Regulation Committee in London. The Department has discussed the present situation with him fully. The American group has decided to urge upon the Committee that they further increase the percentage of permissible exports to not less than 95 percent of the basic quotas for the last half of 1937 and possibly for 100 percent for the last quarter of 1937.[Page 912]
From the American point of view the situation is still unsatisfactory, despite the increased movement of rubber from the producing areas. Stocks are still abnormally low. The price of rubber is still substantially above that corresponding to the cost of production including reasonable profits of efficient producers; the market situation is still too much under the control of dealers and speculative elements. Under these circumstances the American manufacturers cannot bring their stocks up to an adequate and safe point without immense business risks. The responsibility still rests upon the controlling governments to bring it about that large rubber supplies are made available during the rest of this year to make it safe and feasible for the consuming interests to acquire adequate stocks at reasonable prices.
The detailed basis of the Department’s views is contained in the note sent to you in despatch No. 1705 of April 23, 1937,41 the reply to which is awaited.
Accordingly, you are instructed to give all appropriate assistance to Mr. Viles in his discussion with British Government officials.
Repeat the foregoing to The Hague with the exception of reference to despatch No. 1705.