811.20 Defense (M) Brazil/361: Telegram
The Acting Secretary of State to the Ambassador in Brazil (Caffery)
822. Your 1008 of March 24.35 Circular telegram of March 2837 which was repeated to you concerning the rubber situation generally will indicate the belief here that the manufacture of rubber articles in Brazil should be drastically limited. The fact that the other South American republics cannot obtain tires from the United States does not mean that they should be able to get them from Brazil. The reason they cannot get the tires is that on an overall basis, considering the essential needs of the United States, the United Kingdom and the American republics, there is not sufficient rubber to make them. The factors outlined in the circular telegram demonstrate the necessity for making fully effective the provision of the agreements with Brazil [Page 698] that the maximum amount of rubber will be made available to the United States after providing appropriate amounts for internal consumption.
We understand that the rate of rubber manufacture in Brazil has increased tremendously in the last few months. In view of Brazil’s undertaking referred to above, limitations on this would seem appropriate, as well as the institution of other measures of the kind referred to in the circular telegram.
Mr. Douglas Allen, the Rubber Reserve representative now on his way to Rio, as advised by the Department’s telegram 800 of March 27,39 will be prepared to discuss these matters.