811.20 Defense (M) Bolivia/153b: Telegram

The Secretary of State to the Chargé in Bolivia (Dawson)

242. At a meeting today the Metals Reserve Company hinted at its willingness to revise the tin contract to a price of 6¢ gross, f.o.b. Chilean ports. By gross is meant a Straits basis, that is, 60¢ less 1½¢. Nothing definite could be said because it was not felt desirable to be definite until the British had had an opportunity of presenting their views on this price; and the British Embassy here is awaiting further instructions from London. To our surprise, the Bolivian Ambassador stated that his instructions were to stand on a 60¢ net price. The meeting broke up on the understanding that the interested departments and agencies would consult among themselves and reconvene the meeting in the near future. It will be noted that the price which Metals Reserve may be willing to pay, that is 60¢ gross, f.o.b. Chilean ports, represents (a) an absolute increase in the price of 10¢ per pound plus (b) the shipping and insurance costs from Chilean ports to Texas City and (c) plus the complete assumption of liability to provide shipping by Metals Reserve Company instead of the present arrangement which puts the responsibility for providing shipping on the shippers.

In the light of the information which you have furnished us, the 60¢ gross price, f.o.b. Chilean ports, appears to be generous. Your [Page 544] opinion as to the course which the Department should follow will be appreciated.

It appears that a system of control over export prices from the United States will be soon complete and in view of this fact, it was suggested to the Bolivian Ambassador and the producers that the contract should run to December 31, 1943. Your opinion on this point is also requested.

Reference the Department’s telegram of yesterday on the subject of the rubber negotiations,62 the Bolivian Ambassador here has telegraphed to La Paz suggesting that he be given authority to discuss the rubber agreement in Washington. This appears to the Department to be desirable and if you can assist in any way in obtaining a favorable reply to the Ambassador’s suggestion, it would be helpful.

Hull
  1. Telegram No. 238, April 27, 8 p.m., p. 564.