Foreign Relations of the United States, 1955–1957, Western European Security and Integration, Volume IV

224. Telegram From the Acting United States Representative to the European Coal and Steel Community (Boochever) to the Department of State¹

Luxembourg, February 21, 1957—11 p.m.

Colux 154. President Rene Mayer requested I call on him this afternoon to discuss US suspension of scrap export licensing.² Also present at meeting were Vice Presidents Etzel and Coppe, and Spierenburg. Mayer made following points:

1. He was surprised and rather disappointed to learn of this US action through a press report in yesterday morning’s Luxemburger Wort. He would have hoped in view of the High Authority’s efforts cooperate in dealing with the scrap problem and cordial relations it had enjoyed with United States that some advance notification would have been possible.

2. He reiterated point made previously by Rollman (Colux 152³) that summary and conclusions of Commerce scrap report in error in asserting that CSC planned expansion of facilities which would result in increased scrap requirements from the United States. He thought he had made High Authority’s policy on this matter clear in Washington last February⁴ and Rollman had reiterated it in subsequent official discussions—i.e., High Authority working vigorously to reduce import of scrap from United States both through measures penalizing excessive scrap consumption and influencing of investments in direction that would conserve scrap. He said he believed investment survey now under way would show these policies would lead as intended to marked decrease in dependence on United States within 2 to 3 years.

3. He did not take issue with substance of measure which United States had taken, recognizing that some administrative action might be considered normal in present circumstances.

4. He inquired whether this temporary suspension would be of short or long duration. If community could be assured that it was of short duration harm would not be too great. Suspension for a longer period, however, might require basic re-examination of community’s scrap position. He stressed that there were heavy pressures in community in favor of declaring serious scrap shortage, invoking Article 59 and allocating scrap on national basis. If suspension prolonged to extent scrap allocation became necessary would also imperil ability maintain common market for steel. Such development would create a very unfavorable public impression durability CSC common market, which would be particularly unfortunate at this time in view likely adverse effect on prospect for ratification of common market and EURATOM treaties in France.

In reply I made following points drawing on Luxco 78⁵ of February 19:

(1) Mission’s background information on suspension received very short time after newspaper account and immediately communicated to High Authority. Fact that newspaper account regrettably arrived first should not be interpreted as indication any lack of concern by Department or Mission in keeping High Authority informed.

(2) Account in Luxembourg press in error in implying that licensing had been suspended for 6 CSC countries only.

(3) Suspension was temporary administrative action taken by Commerce Department. Should be viewed in context heavy volume of licenses since January 1 and need take account recent conclusions of Battelle scrap report.

(4) Current concern is primarily with potential supply heavy melting grades rather than with over-all quantity of scrap available and any subsequent US action would likely reflect this emphasis.

(5) Commerce scrap report did not single out exports as cause of difficulty, but cited need for both domestic and foreign consumers reducing dependence on heavy melting grades.

I inquired about the volume of CSC orders for scrap in the United States and was told that January orders were in the range of 300,000 metric tons. Coppe reiterated that while High Authority had undertaken to attempt limit CSC imports to average of 200,000 tons a month, it had previously made clear to US that imports in the early months of the year expected to be above average, and below average later on.

In answer to question from Coppe I said that although licensing suspended, as far as I knew actual exports of scrap had not been stopped. Coppe then asked about US export intentions in light Assistant Secretary McClelland’s statement (which Mission has not received) to effect that there was no question of imposing quotas on scrap exports.⁶ While I could not confirm statement I noted US had in past dealt with scrap export problem on basis discussions with High Authority and interested governments and quite possible it would continue seek limit exports in this way.

Mayer concluded by requesting urgently information concerning possible duration of licensing suspension. Coppe stressed would have helpful psychological effect if High Authority could confirm that exports under licenses already issued would not be impeded.

In addition specific answers for High Authority, Mission would appreciate receiving soonest text any public statements made by US officials on subject scrap exports.⁷

Boochever

1. Source: Department of State, Central Files, 850.33/2–2157. Confidential; Priority. Repeated for information to Paris and Bonn; Paris was requested to pouch this telegram to Rome, The Hague, London, and Brussels; the Department was requested to pouch it to Dusseldorf.
2. On February 19, the Department of Commerce temporarily suspended the licensing of ferrous scrap because of the excessive rate at which applications were being filed and in order to permit further study of the situation. The Department reported this development in telegram 66 to Dusseldorf, February 21, repeated for information to Luxembourg. (Ibid., 400.119/2–2157)
3. Dated February 20, not printed. (Ibid. 850.33/2–2057)
4. See Documents 218 and 220.
5. Not printed. (Department of State, Central Files, 850.33/2–1957)
6. Luxco 81 to Luxembourg, February 26, reported that Harold C. McClelland, Assistant Secretary of Commerce for International Affairs, gave an interview to the Journal of Commerce on February 19 regarding the scrap situation. The telegram pointed out that the Department of Commerce did not issue a press release on the suspension of scrap licensing. (Ibid., 400.119/2–2057)
7. No public statements were issued on the subject; see footnote 6 above. On March 26, the Department of Commerce issued a press release announcing the resumption of processing of applications for the export of all grades of iron and steel scrap. The text of the press release is ibid., 811.3314/3–2857.