102.8951 Rio de Janeiro: Telegram

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

391. It is suggested that the agreement for a price premium be utilized by you for insisting that immediate steps be taken by the Banco de Borracha to establish in northeast Brazil (and especially Natal, Maceió, Recife, and Bahia) an adequate purchasing policy and price in order that rubber producers in that region will be able to find a ready market at a price that is profitable and in order at the same time to encourage those merchants who deal customarily in rubber to renew their interest in purchasing and collecting it in the interior to be sold to the Rubber Credit Bank subsequently. The lack of organization in this area by the Bank has been emphasized, as you know, by recent reports of technicians, and merchants and producers are completely discouraged by this lack. Fleischman has also confirmed this fact here in person. This matter will also be brought to Bouças’ attention by me.

Foregoing is from Allen for McAshan Rubber Development.

Hull