811.20 Defense (M) Turkey/15b: Telegram

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

291. Your 598, June 13, 6 p.m.; your 574, June 11, 5 p.m.; and your 548, June 6, 3 p.m.72

The Department believes that in company with your British colleague, you should pursue in the immediate future negotiations for a new Anglo-Turkish chrome agreement. For your guidance the Department is summarizing in this telegram its thoughts on the general [Page 743] lines which might be followed in these negotiations as well as certain suggestions for your consideration in connection with the problem of chrome movement during the balance of this year. In the latter connection, your 548 of June 6 was most helpful.
It is the Department’s understanding (largely based on the Embassy’s despatch no. 1793 of November 3, 194173) that the essence of the Turkish-German chrome agreement is that upon the fulfillment by the Germans of certain conditions, the Turkish Government will authorize the exportation of an annual quantity of 90,000 tons of chrome for the period beginning January 15, 1943 and ending December 31, 1944, but that since Turkey has undertaken to sell to Great Britain all stocks of chrome ore above ground at the end of 1941 and the total production from January 1, 1942 to January 8, 1943, it is not possible, if we are alert, for Germany to purchase any chrome mined in Turkey prior to January 8, 1943, but on the contrary Germany must look for the satisfaction of its tonnage to production subsequent to January 8, 1943. The problem of minimizing Germany’s benefits under its chrome agreement with Turkey would appear to fall into two parts. First, the effective removal from Germany’s potential grasp by January 8, 1943 of the maximum tonnage now mined or in sight prior to that date. The second part relates to minimizing Germany’s actual benefit when the German-Turkish agreement begins to operate.
In connection with the first point above, the Department appreciates your constant and effective attention to this problem. It has no suggestions of importance to add to steps you have pursued for increased movement by rail and by water transport. The Department wishes however, to have explored the possibility that the military authorities in the Middle East could make available to Turkey one or more ships of medium tonnage which would operate in the coastwise chrome movement under the Turkish flag. In this same connection, do you see any possibility of diverting to this purpose the Danubian vessels which you reported in your 483 of May 2773 as being negotiated for by the Turkish authorities? In connection with the limitations placed on shipments from Guleman by the capacity of the rope-way from the mines to the loading station, have all possibilities been explored for an improvised expansion in the rope-way’s capacity or the utilization of other methods which might be installed even at greatly increased cost?
From the review of the chrome situation contained in your 548 of June 6, it is clear that however effective the efforts are to increase the movement of chrome to the accessible ports, a complete clearance at the mines, loading stations and inaccessible ports appears beyond [Page 744] the realm of practicality. Without slackening, therefore, in any way the combined US-British-Turkish efforts in this respect, it would appear necessary that we should at this time give consideration to (a) any available methods of reducing output for the balance of the year, particularly in the mining areas where your report indicates the largest stocks will remain by the year’s end and (b) efforts whereby we render unusable or unavailable the ore we are unable to lift.
In connection with (a) above, it is suggested that thought be given to all possible devices such as payment of bonuses for declaring a moratorium on production. If the Turkish authorities could be persuaded to a proposal of this sort, it is not believed that the increased expense to the US Government involved in making substantial penalty payments therefor would be an obstacle. Failing a practical possibility of securing Turkish agreement to such an arrangement, the suggestion has been made that at inaccessible ports such as Fethiye, it might be possible to move the ore out on rafts and dump it in deep water.
If no effective possibility is contained in paragraph 4 above, other methods of lessening production should not be ruled out. The Department would be interested in learning whether or not any such plans exist on the part of the British, and if so how effective and how easy to institute your judgment indicates they would be.
On the pessimistic assumption that by whatever methods, there will still remain in Turkey say 100,000 tons of ore above ground on January 8, 1943, what measures in your judgment might be taken to strengthen our legal claims thereon? Disregarding the question of penalty payments by this Government (which should not be considered for these purposes an obstacle) what further steps, if any, would you suggest to strengthen our position in this respect?
Turning now to the British suggestion regarding the form of our chrome agreement for 1943, we believe that their scheme has considerable merit. As we understand it, the purpose is to attempt to persuade the Turks to supply us predominantly with high grade ore while selling Germany as large a proportion of low grade ore as is possible. Admittedly this procedure rests on the rather hopeful assumption that the Germans have negotiated a normal contract with penalties or premiums for variation in ore content, and that the Turks are not committed beyond the provisions of such a normal contract. The Department would appreciate it if you would thoroughly explore with the British this scheme and afford the Department your comments as to its probable effectiveness. All of the above is on the assumption that the Turk-German agreement cannot be broken. As you know, this Government is prepared to consider any and all steps designed to further our objectives with regard to chrome as stated earlier in this telegram.
For your information, the present United Nations’ outlook can be summarized as follows: Consumption in 1942 will exceed moderately shipments received from all so-called “safe” sources for the rest of the year plus production of US domestic mines. Due to the outlook for increased US domestic production in 1943, no draft on our stockpile is indicated in that year on the basis of present estimates. Apart, however, from denial to Germany, the fact remains that not only are all receipts of chrome from Turkey highly important for the balance of 1942, but shipments from Turkey in 1943 in maximal amounts would be most welcome.
This telegram has been repeated to London.
  1. Telegram No. 548 not printed.
  2. Not printed.
  3. Not printed.