811.24 Raw Materials/302: Telegram

The Ambassador in the United Kingdom ( Kennedy ) to the Secretary of State

[Extract]

1486. …

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2. The Chairman of the Rubber Committee has circularized the members asking for authorization to raise the quotas for the last quarter from 60 to 70 percent to take care of the Agreement rubber. He has received the consent of all the members except the Dutch who have not replied and I gather that the British are somewhat concerned lest the Dutch withdraw from the International Rubber Agreement. If and when the consent of the Dutch is received the announced increase will be made.

Campbell states he has in mind the possibility of a further release for commercial purposes if it appears desirable and necessary. He admits that there is some danger of a speculative wave “obscuring the real truth of the situation” but feels this will shortly be dissipated, when it is realized that the rubber producing areas can and will supply sufficient rubber to meet all requirements. He points out that the demand from Germany and Poland will automatically cease and due to gasoline restrictions commercial demand in the belligerent countries will decline abruptly.

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Kennedy