894.24/593
Memorandum by the Assistant Chief of the Division of Far Eastern Affairs (Ballantine)
Provenance of Materials Used by Japan in the Conduct of the Conflict in China
The Department has from time to time during the last few months received letters containing statements to the effect that 54 percent of the war materials used by Japan against China come from the United States. It is not known what the basis is for such a statement. To arrive at an approximation of the percentage of the war materials used by Japan against China which originate in the United States, it would be necessary (1) to define “war materials” and to determine the proportions of “war materials” used for military purposes and (2) to take into account (a) Japanese domestic production of “war materials” and imports of “war materials” other than those included in the selected list, (b) the amount of “war materials” used by Japan in the conflict which originate in or are imported into Manchuria as well as other Chinese territory under Japanese control, and (c) the amount used during the present conflict of those “war materials” which Japan has stored over a period of years prior to the outbreak of hostilities.
As of reference in connection with this subject there was published some months ago a survey by the Chinese Council for Economic Research (two Chinese students connected with the Brookings Institution) which stated the conclusion that 54.4 percent of Japanese imports of 13 selected articles essential for war purposes came from the United States in 1937. (The 13 articles referred to are (1) crude and heavy oil, (2) ores, including iron ore, zinc ore and others, (3) pig iron, (4) other iron including steel, scrap, ingots, slabs other than pig, sheets, pipes, tubes and others, (5) lead, (6) copper, (7) tin, (8) zinc, (9) aluminum, (10) mineral oils refined, (11) automobiles and parts thereof, (12) metaland wood-working machinery and (13) internal combustion engines.) Although authoritative figures are not available for imports into Japan of the commodities enumerated during all of the period covered by the survey, it is thought that the estimate of the Chinese Council for Economic Research is substantially correct.
Reference may also be made to a speech made on June 8, 1938, in the Senate by Senator James P. Pope28 on the subject of the sale of [Page 476] war materials by the United States to Japan. In this speech Senator Pope also made the statement that the United States furnished 54.4 percent of Japan’s imports of “war materials”. Although he made no reference to the survey of the Chinese Council for Economic Research he apparently used the same basis for his estimate, that is to say, while Senator Pope listed eleven instead of thirteen commodities in his list he lumped together items (1) crude and heavy oils and (10) mineral oils, refined, and items (12) metal-and wood-working machinery and (13) internal combustion engines under the respective headings of “All Oil” and “Machinery and Engines.”
Neither of the two foregoing estimates necessarily bears any relationship to or affords a basis for calculating the percentage of war materials used by Japan against China which come from the United States. Those estimates are based on figures for imports into Japan of a list of commodities which omits many important commodities essential for military purposes; the estimates do not take into account Japan’s domestic production of war materials, the amount of war materials used by Japan in the conflict which originate in or are imported into Manchuria and other Chinese territory under Japanese control, and the amount used during the present conflict of those war materials which Japan has stored over a period of years prior to the outbreak of the hostilities; and the estimates do not calculate the proportions of potential war materials which are actually used for military rather than peace time purposes.
There is attached a list29 obtained from MID30 of certain commodities essential for military purposes showing the extent of the shortage of Japan’s domestic supply, the source of the foreign supply, her annual requirements, and domestic production of those commodities. Of the 29 commodities and groups of commodities listed the United States supplies 50 percent or more of Japan’s requirements of only three: petroleum, iron and copper; it supplies practically none of Japan’s requirements of rubber, vegetable fibers, oil seeds, wool, tin, and certain less important materials.
The Japanese Customs, apparently for military reasons, has not published since August 1937 figures concerning imports of articles of a military character, including the 13 articles referred to above, nor are any figures available in regard to the production in Japan of any of these articles since 1935.
The Jiji Year Book of 1938, however, gives figures for the year 1935 showing the amount imported, the amount exported, and the amount consumed in Japan during that year of certain of the 13 articles mentioned in the survey of the Chinese Council for Economic Research, [Page 477] from which there can be computed the amount in each instance produced in Japan:
| Imports | Exports | Consumption | |
| (Metric tons) | (Metric tons) | (Metric tons) | |
| Copper | 69,627 | 17,816 | 121,120 |
| Lead | 91,408 | 1,883 | 95,966 |
| Tin | 4,367 | None | 6,438 |
| Zinc | 45,843 | None | 80,034 |
| Iron Pyrites | None | None | 1,338 |
| Sulphur | None | 54,601 | 110,340 |
We thus find that domestic production in Japan of certain raw materials and semi-manufactured products essential for military purposes is very small, but that Japan appears to be entirely self-sufficient in regard to certain items such as sulphur, and produces a substantial share of its consumption of certain commodities such as copper.
Japan’s extensive heavy industries undoubtedly constitute the main source of Japan’s supply of commodities essential for military purposes which are finished manufactures. This is especially true of ordnance which is not included among the 13 items listed by the Chinese Council for Economic Research and which is of course a primary requisite for the conduct of hostilities. An idea may be had of the importance of the Japanese domestic industry as a factor in Japan’s supply of war material by referring to the value of Japan’s industrial output in the three classes of commodities which enter most largely into military requirements. This output for 1936, according to the Jiji Tear Booh for 1939, was as follows:
| Metal Industry | Yen 12,130,719,000 |
| Machinery Industry | “ 1,609,253,000 |
| Chemical Industry | “ 2,202,362,000 |
| Total | Yen 5,942,334,000 |
Subsequent to the outbreak of the hostilities the production of commodities under these three headings is known to have greatly expanded. These figures may be compared with Japan’s total importation of all commodities from the United States which in 1936 and each subsequent year thereafter were as follows: (values given in yen)
| 1936 | 1937 | 1938 |
| 847,453,490 | 1,269,541,908 | 733,610,600 |
| (First ten mos.) |
It will thus be seen that all imports into Japan from the United States in 1936 reached a valuation of only 14 percent of Japan’s domestic output of the three classes of commodities mentioned above, and, in view of the reported subsequent heavy expansion of domestic industry, it is reasonable to suppose that this percentage was no higher in 1937 or 1938.
[Page 478]It thus seems probable that the percentage of war materials supplied by the United States of Japan’s total supply is far less than 54 percent. When we consider the calculations involved in determining the proportion of potential “war materials” actually used for military purposes, the amount of “war materials” which originate in Japan or originate in or are imported into Manchuria as well as other Chinese territory under Japanese control, and the amount used during the present conflict of those materials which Japan is believed to have stored over a period of years prior to the outbreak of the hostilities, the virtual impossibility becomes obvious of attempting to arrive at any precise estimate of the proportionate extent to which the United States constitutes Japan’s source of supply of the materials used by Japan in its conflict with China.