The Chargé in Brazil ( Daniels ) to the Secretary of State
[Received 9:15 p.m.]
708. ReDepstel 489, April 12, 7 p.m. Rubber and wheat situation discussed with Gracie today. Gracie reiterated request reported in Embtel No. 662 of April 9, 4 p.m. He said that as matters now appeared Brazil would receive far less than the amount of wheat it required, and that with permission to export an additional 1500 tons rubber to Argentina, outside the terms of existing agreements, there would be an opportunity to obtain additional wheat supplies from Argentina. He said he did not want to “quarrel” with the US on this point but that was Brazil’s desire and that he regretted it did not seem possible to meet it.
Gracie referred to shortage of tires in Brazil as added reason for permitting additional exports crude rubber to Argentina in view of difficulty in making tire shipments.
Regarding wheat-flour shipments, he pointed out that flour was not adequate substitute for wheat because of high price and also lack of bi-products from milling needed for cattle fodder.
In view of Brazil’s desire to maintain 1942 rubber agreement and tripartite agreement and acceptance CRC allocations (seeking only exceptional permission for 1500 tons shipment to Argentina referred to above) Gracie perceived no need for further tripartite discussions.22
Repeated to Buenos Aires.
- In telegram 515, April 18, 1946, 2 p.m., the Secretary of State indicated to the Chargé his belief that tripartite discussions offered the best prospects for breaking the deadlock and that Brazil would wish to participate (832.24/4–1546).↩