561.321D1 Advisory Committee/95: Telegram
The Ambassador in Brazil ( Caffery ) to the Secretary of State
[Received 11:13 p.m.]
1907. Department’s 1249, December 2, 5 [6] p.m. Ministry of Foreign Affairs which was informed November 30, 5:30 p.m., had apparently been under the impression that the tentative draft agreement as telegraphed by the Brazilian Embassy represented definite and complete proposals. The Ministry says that the draft was discussed with the President by Aranha31 on December 2 but the President’s reaction thereto was not known at the Ministry yesterday.
The Ministry was displeased with the information contained in the Department’s telegram number 1249. The Embassy believes that the Brazilian Government is beginning to be concerned with the delays in reaching an agreement but cannot say whether this concern will be translated into more willing and effective collaboration with respect to the cotton problem than has heretofore been evidenced. The Agricultural Attaché believes on the basis of information from well-informed trade sources and first-hand observation in limited areas in São Paulo last week that if favorable growing conditions continue, the new crop in that state will at least equal last season’s and may exceed it by 5 to 8 percent. The loan levels for the 1941–1942 crop with privilege sale to the Government at the end of the initial financing term of 6 months reported in the Embassy’s telegram number 1650, November 3,32 are unquestionably well above average production costs. The São Paulo Cotton Growers Association recalled to the President when he visited São Paulo last week the Government’s promises with respect to financing and purchase of the coming crop. No regulations have yet been issued for the implementing of this program and it is not known how large scale Government purchases would be financed.