811.20 Defense (M) Turkey/82: Telegram

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

481. 1. Your 953 of September 25, 4 p.m. was received after the dispatch of the Department’s 471 of September 27, 4 p.m.77 The latter telegram, however, contained the necessary authority from this Government for your British colleague to pay 270 shillings per ton for chrome now above ground as well as for ore mined between now and January 8, 1943. The Department understands that your British colleague had been similarly authorized by London.

2. Your urgent consideration and report on the question of offering an even higher price for this ore is requested. There would appear to be definite advantages in making it positively attractive for the producers to sell us all high grade ore which could be mined prior to the expiration of the contract with the British.

3. It is the Department’s understanding that the British have exercised their option to buy all undelivered stocks of ore on hand on January 8, 1943. This is obviously important in order to secure legal title thereto and the Department would appreciate confirmation of this action.

4. The chrome problem, in the Department’s views, falls into three sections. The first relates to holding the Turks to the absolute fulfillment of the last letter of their contract with the British. Unilateral amendment of the British contract has now been authorized to the substantial financial benefit of the Turks and, as you are aware, we are prepared to go further in this direction. We are determined to leave no stone unturned in securing the Turks’ strict adherence to the terms of their contract and financial concessions on our part are of no moment compared to denying the chrome to the Germans and securing it for ourselves. If we grant concessions, however, we must obviously have satisfactory assurances that the Turks will do their part. In this connection please refer to paragraph 4 (a), (b) and (c) of the Department’s 471 regarding the character of the assurances to be sought.

5. The second phase of the problem concerns taking every possible step to prevent the Turks modifying the Germans’ obligations under the Clodius Agreement to the advantage of the Germans. Strong representations should be made in the effort to forestall any attempt on the part of the Turks (a) to relax delivery requirements stipulated of Germany; (b) to grant an increase over the maximum figure of 90,000 tons of chrome in each of the years 1943 and 1944, as is called for by the Clodius Agreement and the Arms Agreement toward which [Page 751] the latter looked; or (c) to anticipate 1944 chrome deliveries in 1943. In this connection every effort should be made to hold the Turks to their earlier informal assurances that we should receive equal treatment with the Germans in 1943 and 1944. If this proves impossible, a contract should be sought along the lines described in your telegram under reference, whereby the entire output above 90,000 tons in each of the 2 years, 1943 and 1944, should go to the British or ourselves. A specification of grades should also be sought to the end that Germany be forced to accept as large as possible a tonnage of low grade ore and we receive high grade ore in the maximum proportion attainable. Needless to say, continued pressure should be exerted to maintain the movement of ore to the accessible ports at the maximum level between now and the year end and thereafter, until the last ton to which we hold title has been cleared from Turkey.

6. While we are most concerned with intensifying in 1943 and 1944 the chrome deficiency with which the Germans are apparently confronted, it seems prudent to safeguard our position for the years following 1944. Please discuss with your British colleague this point. It would not appear to the Department necessary to actually conclude a contract for these future years, provided it were possible to secure the clearest of undertakings upon the part of the Turks to reach no agreement with the Germans for such future period prior to consultation with us, and with the further proviso that Turkey would deliver to the British or the United States a minimum of 50 percent of the total output in each of the years 1945, 1946 and 1947, or for the duration of the war and 1 year beyond, whichever is the less.

7. There is little appeal in a plan to increase markedly Turkish chrome production through furnishing machinery, etc. As the Department has stated before, Turkish chrome is of definite supply interest but this is substantially outweighed by preemptive considerations. To increase production would merely serve to increase the risk of Germany securing larger supplies in the future, while temporarily providing us with chrome which we would like, but if necessary can do without.

8. The measures described in the preceding paragraphs are designed to secure our minimum objective. We must hold at all cost what we are clearly entitled to. The third aspect of the problem, as the Department sees it, relates to an effort actually to break the Clodius Agreement, at least to the extent that it concerns chrome. The Department fully appreciates that the Clodius Agreement, including the understanding on chrome incorporated in it, has for nearly a year represented a fait accompli. The Department further realizes that the Turks possess a limited ability, or even desire, to repudiate it, unless we are in a position to provide very substantial counter-benefits. It is this possibility that we are prepared urgently and thoroughly to [Page 752] examine. Granted the will and even the availability of materials, it is self-evident that shipping limitations would represent a major difficulty. Please explore carefully with your British colleague the character and amounts of commodities or materials which might constitute an attraction sufficient to tempt the Turks to a calculated partial or total default on their deliveries to Germany under the Clodius Agreement. Wheat in large quantities is obviously a possibility. Please report fully on this subject with particular regard to goods of a character which the Turks need and which, even at great sacrifice, we could supply, but of which the Germans could give none at all. The various departments and agencies which would be concerned have not been consulted in this, but the Department believes that there would be every willingness to achieve the utmost in the form of deliveries of commodities, manufactured goods, machinery and equipment in extremely short supply if it could be demonstrated that by so doing the Clodius Agreement and hence Germany’s economic hold on Turkey could be ruptured. This line of thought should not be communicated to the Turks but should be explored with your British colleague and your comments reported to the Department.

9. If strenuous efforts fail to move the Turks from their obligations under the Clodius Agreement, then obviously our efforts must be directed along other lines. These would appear to be (a) a reduction in the physical availability or transport of chrome ore destined for Germany and (b) a delay or interruption in the delivery of German goods to Turkey. On the former, renewed consideration should be given by you in conjunction with your British colleague to various possible measures which were discussed in the Department’s 291 of June 20. The Department appreciates the thought given your reply at the time but would be interested in any modification that time may have effected in the Embassy’s judgment in the matter. Regarding (b) we have asked the British here for a careful examination and study in London.

10. In summary, the Department regards it as vitally important, predominantly for preemptive reasons, to assure first, strict adherence by the Turks to the British chrome contract and second, no amendment in Germany’s favor to the Turks’ existing commitments to Germany. Beyond that a bold line of attack on the Clodius Agreement itself is envisaged which, if it should fail, must be followed by every practicable measure to reduce Germany’s actual receipts of chrome to which she is or may be entitled.

11. This telegram has been sent to Ankara and repeated to London.

  1. Stamp of Division of Defense Materials on telegram No. 953 indicates telegram was not received in that Division until September 28.