The Secretary of State transmits for the information of the Ambassador
copies of a memorandum dated April 6, covering the undertaking
[Page 213]
of this Government and of the
Government of Cuba with respect to the maintenance of prices on rice,
wheat flour, and hog lard, in Cuba.
The text of the memorandum corresponds to the text approved by Dr. Carlos
Hevia prior to his departure from Washington, with the exception of the
price of wheat flour, which officials of Commodity Credit
Corporation28 have now informed Dr. Hevia is to be
maintained at $6.90 per barrel, C. I. F. Habana, when made from United
States wheat, and delivered through Tampa, Florida. According to the
Department’s understanding, Dr. Hevia was informed that savings that may
accrue by reason of shipment through other ports, such as New Orleans,
will be for the benefit of the buyer.
The Ambassador may wish to review with Dr. Hevia the provisions of the
memorandum.
[Enclosure]
Memorandum
In the recent exchange of memoranda between the Government of the
United States and the Government of Cuba, both Governments agreed to
take appropriate measures with respect to price stabilization in
Cuba in 1943. The stability of the Cuban economy is a matter of
grave concern to both Governments. This memorandum is for the
purpose of agreeing upon a framework of reference wherein operations
can be undertaken and mechanisms can be devised to meet the
commitments in principle of the Government of the United States as
to the maintenance of the price of rice until September 1, 1943 and
wheat flour and hog lard landed in Cuba from the United States
during the remainder of 1943; and the concomitant undertaking of the
Government of Cuba to use its best efforts to maintain wholesale and
retail prices in Cuba at current levels on such imports of rice,
wheat flour and hog lard, as well as for the same food products
produced in Cuba, and also edible oils, meat, milk, beans, charcoal
and alcohol.
Since the cost of living of the Cuban people is the basic question
involved, it is, of course, understood that the maintenance of
prices at existing levels by the Government of Cuba means complete
enforcement of legal ceilings to the end that the Cuban consumers
receive the actual benefit of the price undertakings of the
Government of the United States. It would not be consistent in
principle for the Government of the United States to continue to
maintain agreed levels of prices for rice, wheat flour and hog lard
shipped to Cuba, if it should develop that as to these commodities
effective enforcement of price ceilings is not carried out and the
Cuban consumers do not, in
[Page 214]
fact, benefit, to the extent contemplated, by the stabilization
undertakings of the Government of the United States.
The Government of the United States seeks, and will continue to seek,
the most realistic basis for effective action by both Governments in
realizing mutual objectives. Therefore, United States Department of
Agriculture will undertake the following:
Rice: Until September 1, 1943, the price of
rice exported from the United States to Cuba, delivered Habana,
Cuba, will not exceed a price of $6.96 C. I. F. Havana for 50%
broken Prolific. Charges when sent through Tampa shall not exceed
the following:
| OPA29 ceiling f.o.b. mill |
|
$5.555 |
| New Export Premium—4% |
|
.22 |
| Rail freight mill to
Tampa |
.56 |
|
| Wharfage |
.04 |
|
| Switching |
.005 |
|
| U.S. Certificate |
.015 |
|
| Forwarding |
.015 |
|
| Marine Insurance |
.03 |
|
| Ocean freight |
.355 |
|
| Ocean freight
surcharge |
.16 |
|
| Landing charge |
.10 |
1.19 |
| C.I.F.Havana Price |
|
$6.96 |
The rate for war risk insurance shall not exceed that in effect at
present.
The prices of other varieties of rice shall be those established by
the existing OPA regulations and the above charges except that
charges for transportation will be those allowed by OPA regulations
from the point of origin of the shipment.
It is understood that Cuba will not make purchases of rice in the
United States at C. I. F. Havana prices higher than those provided
for above without prior approval of the United States Department of
Agriculture.
Board of Economic Warfare will use its best efforts to secure maximum
practical movement of rice through Gulf ports.
The quantities of rice involved in this undertaking shall not be in
excess of the 325,000,000 pound allocation made by the Combined Food
Board30 to Cuba for 1943, after
deducting purchases already made from United States, and from other
sources in excess of 50,000,000 pounds. (The remainder is estimated
as 98,000,000 pounds.)
Wheat Flour: That until January 1, 1944, for a
quantity not to exceed 700,000 bbls., to be contracted for before
April 22, 1943, bread
[Page 215]
wheat flour of the quality normally used by bakeries in Cuba will be
available at a price of $6.90 per bbl. C. I. F. Havana, when made
from U. S. wheat, and delivered through Tampa, and a price of $7.22
per bbl. C. I. F. Havana when made from Canadian wheat flour.
Payment to be made by sight draft and consular fees for buyer’s
account. War risk insurance charges shall not be higher than the
present rates. It is understood that Cuba will not make purchases of
flour in United States prior to April 22, 1943 at C. I. F. Havana
prices higher than those provided for above without the approval of
the United States Department of Agriculture.
Hog Lard: Until January 1, 1944 the price of
refined hog lard exported from the United States to Cuba in
carloads, tierces originating in Kansas City shall not be higher
than $17.53 per hundred pounds C. I. F. Havana. Charges shall not be
higher than the following:
|
Per
100 lbs |
| OPA ceiling (carload
tierces—Kansas City) |
$14.30 |
| Export premium (figures at 7%
though most shippers get less) |
1.00 |
| OPA Price |
15.30 |
| Rail freight, Kansas City to
Tampa |
.90 |
| Switching charge—Tampa |
.045 |
| Forwarding |
.34 |
| Ocean freight to Havana |
.88 |
| Marine Insurance |
.06 |
| C.I.F. Havana Price |
$17.53 |
The prices of other types of lard shall be those established by the
existing OPA regulations and the above charges except that charges
for transportation shall be those allowed by OPA regulations from
the point of origin of the shipment.
The rate for war risk insurance shall not exceed that in effect at
present.
It is understood that Cuba will not make purchases of hog lard in
United States at C. I. F. Havana prices higher than those provided
for above without prior approval of the United States Department of
Agriculture.
The quantities of hog lard involved in this undertaking shall be the
remainder of the 45,000,000 pound allocation of the Combined Food
Board to Cuba for 1943 after deduction of purchases already made in
the United States and other countries. (The remainder is estimated
as 34,000,000 pounds.)
The Cuban Government will take appropriate measures to prevail upon
Cuban lard importers to purchase the third quarter allocation for
1943 (10,000,000 pounds) during the second quarter of 1943.
