811.20 Defense (M) Brazil/525: Telegram
The Ambassador in Brazil (Caffery) to the Secretary of State
[Received 10:52 p.m.]
1486. For Finletter,42 Newhall,43 Clayton,44 Klossner,45 from Allen. Department’s 1076, April 24 [25], midnight, and my 1442, April 28, 9 p.m.46 Following agreement reached at meeting with Brazilian rubber manufacturers and members Brazilian Commission subject approval Finance Minister.
1. Annual over-all quota 10,000 tons dry weight rubber and reclaim.
2. Minimum of 25% of quota to be devoted to manufacture essential products for export to apply against essential Western Hemisphere requirements as determined by Washington thereby in effect establishing maximum internal quota of 7,500 tons.
3. Rubber Reserve to purchase exportable surplus tires and tubes at equivalent of net Rio de Janeiro dealer prices as approved by Brazilian Government.
4. Export of tires and tubes to countries other than United States prohibited effective immediately regardless of licenses outstanding. Necessary instructions already issued by Finance Minister.
5. Manufacturers miscellaneous rubber goods willing discontinue manufacture non-essentials and restrict exports to the United States provided prices agreed upon and orders placed for tires and other essential rubber products. Advisable United States give earliest possible assurance these countries with respect supply essential requirements.
Roberts47 remaining Rio de Janeiro until end next week to conclude negotiations miscellaneous products will then join us Lima. Urgently need information requested our telegram 1225, April 10, midnight48 about miscellaneous rubber products for meeting with manufacturers May 7. Telegraph basic information if cannot be airmailed.
Official price schedules have been published in Brazil thereby facilitating resumption shipment.
Believe proportion exportable surplus may run higher than 25% because of acute shortage gasoline and drastic gasoline rationing which already has materially reduced non-essential driving and demand for tires.
[Page 701]Strong diplomatic pressure being brought to bear upon Brazil by other Latin American countries to supply essential export products.
6. All manufacturers willing use approximately same proportion reclaim as now used in United States when available.
7. Brazil desires develop maximum possible domestic supply reclaim and requests United States facilitate shipment pan reclaim equipment.
Telegraph if pan reclaim can be satisfactorily used in same proportion as digested reclaim in United States of America.
8. Brazilian Commission is recommending 2-year suspension of duties and other obstacles to importation and use of reclaim from the United States. Brazil willing use reclaim from the United States to extent their domestic supply inadequate to comply with paragraph 6.
9. Brazil to undertake campaign to bring about economy in use of rubber products.
10. United States to facilitate shipment materials needed by rubber manufacturing industry with respect to which Brazil is dependent upon United States.
11. United States to give assurance to Brazil with respect to supply rubber goods essential for Brazilian military and industrial purposes or equipment for manufacture thereof. [Allen.]
- Thomas K. Finletter, Acting Chief, Division of Defense Materials.↩
- Arthur B. Newhall, Chief, Rubber and Rubber Products Branch, War Production Board.↩
- W. L. Clayton, Assistant Secretary of Commerce.↩
- Howard J. Klossner, official of the Rubber Reserve Company.↩
- Latter not printed.↩
- James C. Roberts, assistant to the President of the Rubber Reserve Co.↩
- Not printed.↩