894.51/662
The Australian Legation to the Department of State
Aide-Mémoire
Before the outbreak of the war, Japanese firms were negotiating for the purchase of Australian wheat on credit. After the outbreak of war the Australian Government acquired all wheat including the crop harvested in December and appointed a wheat board to market it.
Negotiations between Japan and the board led to the submission of the matter to the Commonwealth Government in October. At that time, marketing prospects for Australian wheat were very poor and it seemed that alternative sales on credit were indefinitely stopped with all attendant costs and risks. The Government, therefore, agreed to deal in respect of 200,000 tons of wheat, 18 months credit from the date of the first shipment, purchasers to lift the wheat. The first shipment was made on December 28th, 1939.
Since the conclusion of the above deal, there have been negotiations between Australian flour millers and Japanese firms for the purchase of wheat flour on credit. The Australian Government have not encouraged or authorized those negotiations. The Government have also rejected other proposals for further wheat sales on credit.