Memorandum by Mr. Paul C. Daniels of the Division of the American Republics to the Under Secretary of State (Welles)

Mr. Welles: On my memorandum of September 16 you indicated your willingness to consider the possibility of presenting to the Inter-American Committee a coffee quota plan which in the opinion of this Government would be fair and equitable.

At the meeting of the Subcommittee on Coffee held at the Pan American Union on September 16 the members of the Subcommittee expressed their desire to hear this Government’s views on the allocation of coffee quotas for the United States market. This desire was confirmed by the unanimous vote of all the delegates from the producing countries represented on the Subcommittee.

There is accordingly attached a table on which are indicated (in the second column of figures) proposed basic quotas for the United States market. For purposes of comparison the New York quotas are indicated in the first column. It will be observed that the total figure of 15,900,000 bags reached at New York has been retained in the basic quotas for the United States now proposed. Certain changes, [Page 398] however, are suggested in the allocation of this total among the producing countries.

The figures in the third column, representing coffee export quotas to markets other than the United States, have been arrived at by subtracting the quotas for the United States market from the figures given in the last column. The figures in the last column represent total exports to the world from each producing country in the year of greatest exports during the six-year period 1934–1939. This procedure, i. e., subtracting quotas for the United States from the total figures given in column 4, was adopted at an earlier meeting of the Coffee Subcommittee and therefore followed in this case. However, the only proposals invited from this Government are those contained in column 2, indicating proposed basic quotas for the United States; the figures for quotas to other markets have merely been included to facilitate appraisal of the whole situation.

The new proposed allocation of the quotas for the United States contained in column 2 has been carefully considered and unanimously approved by the officials who have been studying this problem most closely, namely, Messrs. Mueller and Wheeler of the Department of Agriculture; Mr. Domeratzky of the Department of Commerce; and Messrs. Collado and Daniels of the Department of State.

Proposed Basic Quotas in Bags of 60 Kilograms

Exporting Countries New York Quotas To United States To Other Markets Total*
Brazil 9,322,000 9,300,000 7,813,000 17,113,000 (1938)
Colombia 3,200,000 3,150,000 1,079,000 4,229,000 (1938)
El Salvador 600,000 600,000 527,000 1,127,000 (1937)
Costa Rica 210,000 200,000 242,000 442,000 (1937)
Cuba 80,000 80,000 62,000 142,000 (1939)
Nicaragua 195,000 195,000 114,000 309,000 (1935)
Venezuela 400,000 420,000 606,000 1,026,000 (1936)
Santo Domingo 120,000 120,000 138,000 258,000 (1939)
Ecuador 180,000 150,000 89,000 239,000 (1934)
Guatemala 500,000 535,000 312,000 847,000 (1936)
Haiti 275,000 275,000 327,000 602,000 (1936)
Honduras 15,000 20,000 21,000 41,000 (1937)
Mexico 450,000 475,000 239,000 714,000 (1936)
Peru 25,000 43,000 68,000 (1934)
Total American Countries 15,547,000 15,545,000 11,612,000 27,157,000
Other Countries 353,000 355,000
Total 15,900,000 15,900,000

Note: The following factors have been considered in arriving at the proposed basic quotas:

Average total exports from each country during recent years.
Average exports to United States during recent years.
Requirements of United States market for special types of coffee.
Normal markets for each country’s coffee.
Abnormal conditions due to war.

  1. The figures in this column represent the total exports from each country in the year of greatest exports during the six-year period 1934–1939.