Foreign Relations of the United States: Diplomatic Papers, 1943, The American Republics, Volume V

832.61333/766

Résumé of the Coffee Agreement Between Brazil and the United States⁸⁴

March 20, 1943

1 —Both Governments will do everything possible to facilitate the shipment to the United States of America, of all quotas established by the Interamerican Coffee Pact. It is understood that the Commodity Credit Corporation will purchase or underwrite, through the established commercial channels and in accordance with existing commercial practices of the trade.

2 —For the quota year of 1941/42, the Commodity Credit Corporation agrees to purchase or underwrite the existing contracts, to 90% of the f.o.b. value, of the coffee of the types used in the United States of America, which may not have been shipped up to September 30, 1942.

3 —For the 1942/43 quota year, Commodity Credit Corporation will agree to purchase such part of the coffee of the types used in the United States of the basic annual quota (9,300,000) bags as it may not be possible to ship.

4 —At the close of the quota year, which ended on September 30, 1942, the coffee purchased or financed in Brazil, according to Item 2, may be shipped to the United States of America against the 1942/43 quota, however, the quantities so shipped being replaced simultaneously by purchasing in Brasil coffee of the current crop.

5 —The coffee purchased or financed by the Commodity Credit Corporation will be made f.o.b. usual shipping ports, considered satisfactory by the Commodity Credit Corporation, and in accordance to distribution to these same ports made by the National Coffee Department, upon the basis of the maximum price, determined by the Revised Price Schedule n. [No.] 50—Green Coffee, of the Office of Price Administration as amended, or at the then prevailing U.S.A. market price, whichever is lower. In either event, 2% will be deducted for handling and administration expenses.

6 —The coffee purchased or underwritten by the Commodity Credit Corporation in Brazil may be substituted by new purchases, whenever there is a possibility of same becoming deteriorated; the Brazilian Government will facilitate the “turning over” of such stocks in accordance with the Commodity Credit Corporation.

7 —The storage charges will be paid by the Commodity Credit Corporation, starting after 90 days of storage date; this storage will be approved by the Commodity Credit Corporation and supplied by Brazil at nominal rates, or, in cases of private warehouses, at rates not exceeding those now in effect.

8 —The sellers will be responsible for:

a) delivery f.o.b. of any coffee purchased or underwritten.

b) export taxes and any other expenses incident to placing of the coffee on board steamer.

c) insurance (excepting war risk insurance) during the 90 day free storage period, by an insurance company established in Brazil, or by Department of the Brazilian Government, acceptable to the Commodity Credit Corporation.

d) 90 days storage period, in warehouses approved by the Commodity Credit Corporation.

If it become necessary to accept delivery of coffee prior to shipment, mutual and satisfactory arrangements will be made by the sellers and the Commodity Credit Corporation, which assure the purchaser the payment of taxes and other expenses incident to shipment of the coffee by the sellers.

84. Copy transmitted to the Department by the Ambassador in Brazil in his despatch No. 10494, March 20, 1943; received March 26.