Foreign Relations of the United States Diplomatic Papers, 1939, General, Volume I

800.6354/135: Telegram

The Ambassador in the United Kingdom (Kennedy) to the Secretary of State

London, August 31, 1939—6 p.m.
[Received August 31—12:50 p.m.]

1332. Department’s 722, August 30, 11 a.m. and Embassy’s 1326.⁸²

1. On August 29 Campbell circularized the members of the Tin Committee, including the consumers’ panel (Todd has been informed by cable) asking for immediate authorization to increase the present quota of 45 percent retroactively to 60 percent for the third quarter and to fix the quota for the last quarter at 60 percent.⁸³ He has now received the consent of all the countries except Bolivia. Minister Patino is in Italy and apparently cannot be reached. Campbell proposes to wait a day or two in the hope of getting in touch with him and if not to make the announcement anyway since he has the requisite number of votes in hand. Campbell computes that this will wipe out all over-exports and at current rate of consumption increase world stocks by about 3000 tons by the end of the year.

2. The Embassy represented strongly the situation facing American consumers and pointed out that the quota increases would not have the effect of actually increasing by a large amount the total visible stocks. In turn Campbell referred to the latest figures (to be found in the statistical bulletin of the International Tin and Research Council of The Hague) indicating that United States “stocks and landing” and “afloat” July 1939, were 5,339 and 4,480, respectively, as compared with 4,071 and 6,003 in July, 1938. The yearly average figures for 1936 were 3,103 and 6,867 respectively. The corresponding figures for the United Kingdom are 10,076 and 137, 7,472 and 270 and 1,008 and 431. The increase in the United Kingdom stocks is due to the buffer stock pool. The position of the buffer stock as of August 29 was that it contained 8,850 tons, of which 3,000 had been sold forward mostly for November delivery. The buffer stock, therefore, has 5,850 tons of tin free of claim. Both Campbell and the responsible official concerned with the issuance of export permits gave assurance that it was not their policy to stop any tin shipments to the United States from the United Kingdom. When the export license regulation was imposed there were two strauss tin shipments, one of which was aboard ship and the other at the railhead. An export license was immediately granted for the former and is now being granted for the latter. Since then another license has been applied for but has not yet been dealt with but will go through. Therefore, some delay but no prohibition of tin exports to the United States is occurring.

3. In discussing the contingency of war, Campbell stated that during the first 3 years of the last war the price of tin fell because the world demand in wartime conditions, given the blockade of the Triple Alliance Powers, declined. It was only when the shipping problem had become acute that the price rose. He stated that the United States Government had become exercised about this situation and bought a large supply of tin which was not consumed and that as a consequence after the war it had had to undertake the drastic measure of prohibiting imports of tin for over a year in order to liquidate its stock. He indicated that the British Government plans in the event of war to continue to import for smelting Nigerian and Bolivian tin which is about 72 percent concentrate and that more than an adequate supply of Middle Eastern tin would be available for American needs and far more than would be required and that the smelting facilities of the Straits Settlements were adequate to handle any such demand.

Kennedy

82. Telegram No. 1326 not printed.
83. The percentages mentioned here and in later documents pertain to quotas to be fixed by the International Tin Committee with reference to basic quotas stated in articles 11 and 12 of the tin agreement of January 5, 1937, International Labour Office, Intergovernmental Commodity Control Agreements (Montreal, 1943), pp. 81, 83. The standard tonnages for the territories were as follows: Belgian Congo, 13,200; Bolivia, 46,490; French Indo-China, 3,000; Malaya, 71,940; Netherlands East Indies, 36,330; Nigeria, 10,890; Siam, 18,000; total, 199,850.