811.20 Defense (M) Turkey/85a: Telegram

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

471. 1. The Department understands from British telegrams on chrome exchanged between London and Ankara (repeated to Washington) that you and your British colleague are in agreement that it is necessary to meet the German price of 270 shillings per ton on all present stocks as well as ore produced between now and January 8, 1943.

2. The Department further understands that the British Government agrees to the necessity of so amending their contract and has offered to share equally with the United States the cost of such increase in price.

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3. The Board of Economic Warfare with the full concurrence of the Department is firmly of the opinion that the matter of price should be no obstacle in holding to a minimum German takings of Turkish chrome after January 8, 1943. The Board is prepared to issue to this end the necessary purchase authority.

4. You are therefore empowered in consultation with your British colleague to offer the Turks any price up to 270 shillings per ton for ore now above ground plus ore mined between now and January 8, 1943, provided that the Turks agree to cooperate fully and effectively along the following lines:

Every single ton of ore now above ground and produced up to January 8, 1943 comes to us and not to the Germans.
Every necessary facility is afforded us for inspection and supervision of the whole course of production and the stock situation.
Assurances are given of continuing effective cooperation in the movement of ore to accessible ports and removal of ore from those ports.

5. It is believed here that there is no reason why our action on financial terms should be confined to merely meeting the Germans. The Department therefore suggests that you discuss with your British colleague the advisability of outbidding the Germans by offering a price, for example, of 300 shillings a ton. The Board of Economic Warfare is thoroughly sympathetic to this view. Please telegraph urgently your recommendation on this. The necessary authority for any further steps will be given promptly.

6. Estimates vary here and in London regarding tonnage to which the proposed increase in price will apply. Please telegraph on this point. Our present assumption is that present stocks and interim production to January 8, 1943 would be between 100,000 and 250,000 tons.

7. The Department will telegraph in the immediate future its views regarding general strategy of seeking to break impending German chrome agreement. This telegram is merely designed to give you necessary authority to deal with this aspect. Denial of chrome to the Germans to minimum figure is regarded as of most vital importance.

8. In addition to preemptive element, Turk chrome remains highly important to United Nations on supply grounds as well as having great importance in public judgment of Turkish policy. Please do not fail to make these points with the Turks. This telegram has been repeated to London.