561.333D3/1619k: Telegram

The Secretary of State to the Ambassador in Brazil (Caffery)

97. Continued from immediately preceding telegram.2 In the absence of a considerable increase in the volume of sales of coffee by the producing countries, return to coffee rationing in this country in the near future appears inevitable.

The Board is still collecting data which would be useful in considering whether or not to request the Office of Price Administration for a price increase. Penteado3 states privately that he is willing to drop the matter. It is felt that the majority of the other members of the Board would agree. Since some of the members favor pressing for an increase and since the Board is still collecting data which would be needed if the question were to be taken up with the Office of Price Administration, the matter remains a very disturbing element in the coffee trade.

Members of the coffee trade here have expressed the view that if the National Coffee Department of Brazil were prepared to sell at prices which would permit sales within the Office of Price Administration ceilings coffee in sufficient volume to use shipping which might not otherwise be utilized and if this were known among members of the trade in this country and in Brazil, it would go a long way toward breaking the present impasse.

It is requested that the Embassy discuss with the appropriate authorities of the Brazilian Government steps which the Brazilian Government might be willing to take in addition to any it may already have taken to facilitate the movement of coffee to this country and that it keep the Department informed of all developments having a bearing on the situation.

  1. Not printed; this telegram quoted the communication from the Chairman of the Inter-American Coffee Board, supra.
  2. Eurico Penteado. Brazilian delegate to the Inter-American Coffee Board.