The Brazilian Ambassador ( Martins ) to the Assistant Secretary of State for American Republic Affairs ( Braden )

My Dear Spruille: With further reference to our past conversations on the coffee pricing policy of the United States’ Government regarding particularly the imports of Brazilian coffee, I would like to emphasize once more the imperative urgency in reaching an agreement upon the question of prices. It will be reminded that to this effect the Brazilian Government has so far submitted two proposals to be considered by your government.

The first one contemplates the elimination of present coffee price ceilings in exchange for a guarantee by the Brazilian Government to place at the disposal of the United States import market a monthly [Page 514] amount of coffee during a six month period at prices three cents above the price ceilings into effect.

The second proposal contemplates the maintenance of present price controls on coffee followed by a readjustment in its ceilings which should be raised by five cents above its present level.

I repeat again that my Government is prepared to accept either one or the other of the two proposals, because of the fact that the present subsidy plan not only fails to provide our coffee economy with a reasonable margin of profit to cover the increasing costs of production but also because it constitutes a temporary expedient which should now give place to a more permanent one.

On this respect, I feel very happy to ascertain that you hold the same opinion and I wish to take this opportunity to convey to you my appreciation for your statement, as issued in New York, on May the 16th, to the effect that, and I quote, “the subsidies have failed to solve the problem of increasing coffee prices; an urgent solution becomes necessary”.

It was indeed very encouraging to notice that your attitude towards this problem was taken in public what leads us to believe that prompt measures to materialize it might be forthcoming.

However, I fail to understand the apparent lack of enthusiasm on the part of the price control authorities of this country in arranging for a meeting where our proposals would be aired to the effect of finding a permanent solution to this pressing matter.

This is as much difficult to understand as you yourself have manifested to me the wholehearted support of the State Department to my suggestion relative to our meeting together with the above mentioned authorities to discuss at length the possibilities of a long range plan based on either one or the other of the Brazilian proposals.

As you know, my dear Spruille, during the next month of June the present subsidy scheme will be inoperative bringing to a standstill the sales of coffee from our producers to the United States’ internal market. Therefore, the lack of a reaction on our proposals might contribute to future confusion and retraction in the coffee trade.

Incidentally, I inform you that at such a meeting I will be accompanied by Mr. E. de Mello, Commercial Counselor of the Embassy, Mr. Eurico Penteado, Brazilian Representative to the Inter-American Coffee Board, and Mr. C. Garcia, Second Secretary of the Embassy.

Therefore, I hope that you will let me know as soon as possible that the necessary arrangements are made and the opportunity has come for a meeting with the competent authorities of your Government.43

I am,

Cordially yours,

Carlos Martins
  1. The reply of May 23, 1946, indicated that the proposals were under consideration by the authorities concerned with prices and that a further meeting would be held at the convenience of the Ambassador (811.5017/5–2046).