895.659/7–2248: Telegram
The Economic Adviser in Korea (Bunce) to the Secretary of State
priority
[Received July 28—3:28 a. m.]
588. Cite Zpol 1121. Part 1. In view of prospective shortage of fertilizer to meet South Korea’s requirements (reference WARX 85218, July 3; CX62041, July 2; WARX 85536, July 10) renewed efforts are being made to procure North Korea-produced fertilizer. In addition to efforts to procure fertilizer from North Korea through private trade channels (reference radio ZMGNEB 1430, July 14) General Hodge despatched letter to Soviet Commander in North Korea on July 22 proposing purchase of up to 100,000 metric tons of ammonium sulphate from North Korea for use in South Korea. This letter, dated July 21, has not yet been released to press,1 Only result expected from this letter is favorable propaganda.
Part 2. Text of letter from Hodge to Merkulov follows:
“Prior to allied occupation of Korea most of the chemical fertilizer produced in the large chemical plants in North Korea was utilized by the farmers of all of Korea.
“Despite the efforts of the American Government to unite Korea and to prevent the 38 parallel from becoming a barrier cutting off the normal flow of goods between’ North and South Korea, the farmers of South Korea have been deprived of their normal supply of chemical fertilizer from North Korea since August 1945.
“Because the resulting shortage of fertilizer in South Korea worked serious hardship upon the Korean people, the American Government has purchased on world markets and brought into South Korea over 500,000 metric tons of chemical fertilizers.
“It has recently come to my attention that fertilizer produced in North Korea is being sold to foreign nations for ruse outside Korea. It is my belief that as long as there is a shortage of fertilizer in Korea, all fertilizer produced in Korea should be made available for use by Korean farmers on Korean farms. For this reason, I once again urge that the Soviet occupation authorities, or Koreans designated as their agents, negotiate for the sale or barter of fertilizer produced in North Korea for use by the farmers of South Korea.
“As a concrete step toward reaching an agreement, I propose the immediate negotiation of an initial contract for the purchase for use in South Korea of up to 100,000 metric tons of Korean-produced ammonium sulphate, to be paid for in American dollars, with funds to be supplied by the American Government. I propose that a conference [Page 1255] be held in Seoul or Pyongyang at the earliest possible date to conclude such a fertilizer-sales contract.”
- Telegram 645, August 10, from Seoul, reported General Merkulov’s reply of August 9, advising General Hodge to “turn to the North Korea People’s Committee” for any contract. The exchange was, not being released to the press at that time. (895.659/8–1048)↩