811.20 Defense (M) Turkey/35: Telegram

The Ambassador in Turkey ( Steinhardt ) to the Secretary of State

819. The summary of the present and projected United States preemptive buying program in Turkey, contained in your 358, of July 23, is exceedingly helpful to the Embassy. I greatly appreciate the discretionary powers which the Department has accorded me in connection with the carrying out of this program.

The program has been discussed with the British Embassy and the UKCC in connection with the buying program proposals drawn up by the Joint Preemption Commission in London. The United States program and the London proposals have been the subject of extensive discussion with a view to correlating the purchasing activities of the two Embassies and determining the measures best calculated to attain most effectively the objective of preempting the maximum quantities of all commodities of which the Axis has currently or may develop as supply need. The following comments and recommendations are made in the light of these preliminary discussions. I contemplate having further discussions of this subject shortly in Istanbul with our Acting Commercial Attaché and the representatives there of the British Embassy and the UKCC.

1. Opium, antimony, copper and woolen rags. The purchases of these commodities are to be left in the hands of the United States Embassy, the USCC [UKCC?] collaborating in respect to the handling of the physical details.

With regard to copper it is estimated that Turkish copper stocks amount at present to approximately 10,000 tons and that annual production is about 9500 tons. Of the 12000 tons to be delivered to Germany under the Turkish-German trade agreement only 1500 tons have been delivered to date. The Prime Minister has assured me that if the Germans do not deliver in the near future the products in exchange for which copper is to be supplied by Turkey, additional quantities of copper will be made available to us. This Embassy will continue to press the Turkish Government with a view to acquiring as large a quantity as possible of the exportable surplus.

The Embassy will telegraph shortly the situation obtaining with respect to antimony and woolen rags.

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2. Mohair. Both Embassies are to continue to endeavor to obtain export licenses for additional amounts of mohair until the balance of this year’s crop, estimated at 1400 tons, is exhausted. This year’s crop is estimated at 5000 tons, and of this amount 2800 tons have already been acquired by the British and 400 [sic] by ourselves. While it appears doubtful that the Turkish Government will grant any further licenses for the export of mohair to Great Britain and the United States, we are agreed that the two Embassies should make every effort to obtain as much of the remaining 1400 tons as possible.

3. Molybdenum. The purchase of this commodity is to be left in our hands and an investigation is now being made with a view to ascertaining whether there are any stocks of this mineral available for export.

4. Cotton clipping, waste and rags. In view of the fact that the UKCC is active in this market with a view to purchasing 1500 tons, and that not more than 1800 tons are likely to be available during the next 12 months, it is considered that our entrance into this market is unnecessary at the present time. The UKCC has already procured a license for the export of 300 tons and is now seeking to obtain a license for the export of an additional 300 tons now available in Istanbul. The UKCC will continue to endeavor to acquire all available stocks of this commodity and we will enter the market if and when it becomes necessary to supplement the efforts of UKCC. Consideration was given to question of buying up for storage purposes available supplies for which Turks would refuse to issue export licenses to UKCC but it was decided to refrain from taking such action at present time in view of unfavorable reaction which it would undoubtedly produce among Turks.

5. Flax. UKCC is now in market for 600 tons. It is estimated that present stocks total 500 tons and that new crop will amount to 1500 tons. British and ourselves will collaborate in an endeavor to buy up whole exportable surplus.

6. Hemp. UKCC is already in market for 1000 tons. Existing stocks are estimated at approximately 2000 tons and new crop at 4 to 5000 tons. British and ourselves will collaborate in an attempt to buy up the whole exportable surplus.

7. Cotton. The export of cotton is prohibited except in exchange for urgent Turkish requirements and even then only short staple yerli or the poorest grades of Cleveland may be exported. Turkey has been seeking to import from either Egypt or Irak long staple cotton, which is required by Turkish mills, but the British have refused to accede to Turkish requests except against an equivalent value of short staple cotton.

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8. It is the considered opinion of the two Embassies that it would be inadvisable to attempt to charter caiques for preemptive purposes. In the first place the charter of caiques is strictly controlled by the Turkish Government with a view to serving Turkish transportation needs and the Turkish Government would naturally, in view of the great shortage of shipping, object to any effort made to reduce the number of available caiques. Furthermore the caiques are largely employed in bringing material from Bulgarian ports which Turkey needs and it is felt that interference with the importation of products badly needed by Turkey would do more harm to Turkey than to the Axis.

9. In view of the fact that the British are purchasing or endeavoring to purchase in maximum quantities obtainable olive oil, wool, sheep, lamb, kid and goat skins, valonia and valex, there would appear to be no need for our entrance into these markets at least at the present time. This consideration also applies to silk cocoons and silk waste, all available supplies of which the British are prepared to purchase.

UKCC has purchased whole exportable surpluses of 1941 crops of valonia and valex and British are requesting authorization to purchase up to 20,000 tons of 1942 crop of valonia and 5,000 tons of 1942 crop of valex, latter two amounts being considered to represent total exportable surplus of these commodities from this year’s crops. Export of wool is forbidden at present time and it is not believed that this embargo will be lifted in near future. UKCC has bought 2500 tons of skins and has authority to purchase a further 1000 tons. British are requesting authorization to purchase a further 1100 tons which will clear market. Export of olive oil is forbidden at present time and UKCC at request of Turkish Government has handed back 5000 tons which they purchased from 1941 crop in order to meet local shortage. It has been agreed between UKCC and Turkish Ministry of Commerce that first 5000 tons of any exportable surplus of olive oil will be made available to UKCC as compensation for amount taken over from them. Owing to damage done to olive trees by severe winter it is considered unlikely that there will be any exportable surplus during 1942 or 1943.

10. Linseed. No stocks exist at present and no reliable figures are as yet available regarding 1942 crop. It is estimated, however, that this will approach 8,000 to 10,000 tons. In view of keen demand from central European powers for linseed, two Embassies feel that this commodity has a high preemptive interest and British are recommending that UKCC be authorized to purchase any quantity offered.

11. Oil seeds. In view of fact that Axis Powers have attached considerable importance to purchase of oil seeds such as sesame seed, sunflower seed and ground nuts, two Embassies are agreed that we [Page 717] ought to enter these markets with a view to acquiring maximum quantities available of these commodities. Proposed British buying program for these commodities calls for purchase of 15,000 tons of sesame seed, 5,000 tons of sunflower seed and 1,500 tons of ground nuts. It is not believed that ground nuts will be available for export and it is doubtful whether any large quantity of sesame or sunflower seed will be procurable since it is understood that Turks intend to convert these commodities into cakes for animal fodder on account of cereal shortage.

12. Gum tragacanth. Inasmuch as Germans and Italians have taken considerable interest in this commodity British are recommending that authorization be granted to purchase total exportable surplus estimated to amount to 250 tons.

13. Hazel nuts. Question of purchase of hazel nuts which were not mentioned in Department’s telegram has been subject of considerable discussion. It is understood that Germans are using hazel nuts for making lubricating oil and also for food purposes. They purchased 20,000 tons last year when crop amounted to only 20,000 tons, although there was a large carry-over from previous year. This year’s crop is estimated at 70,000 tons unshelled with a carry-over of 2,000 tons from last year. Transportation of this commodity to accessible ports presents a difficult problem inasmuch as hazel nuts are grown exclusively on the Black Sea coast with which there is no rail communication. An important consideration is fact that Turks have been pressing British to purchase larger amounts of this commodity. Consideration was given to question of possibility of delivering hazel nuts to Russians and also to possibility of pressing oil from nuts in Turkey. Recommendations with regard to this commodity will be submitted upon completion of a study of hazel nut situation which is now in progress.