Office of the Historian

Conference files, lot 59 D 95, CF 100

No. 342
Memorandum by the Deputy Administrator for International Materials Activities (Ticoulat) of a Meeting at the Department of the Treasury on the Afternoon of January 8, 19521
confidential
TCT CONV–8—Part II2
January 8, 1952

Present:

  • U.S.

    • Mr. Wilson, ODM
    • Mr. Fleischmann, DPA
    • Mr. Harriman, MSA
    • Mr. Bissell, MSA
    • Mr. Thorp, State
    • Mr. Winthrop Brown, State
    • Mr. Ticoulat, DPA

  • U.K.

    • Lord Cherwell
    • Sir Leslie Rowan
    • Lord Knollys
    • Mr. McDougall
    • Mr. Hall
    • Mr. Rickett
    • Mr. Waight
    • Mr. Senior
    • Mr. Wheeler

Tin

The U.K. representatives stated that they were prepared to supply 10,000 tons of tin to the United States during the first six months of 1952 at a fixed price of $1.18 per pound f.o.b. Singapore and 10,000 tons during the second half of 1952 at a price not more than $1.25 nor less than $1.18 to be negotiated after it was determined how they came out in their purchases of the first 10,000 tons. It was agreed to be desirable from the point of view of the effect on the market that announcement should be made only with reference to the first 10,000 tons, although if we were questioned by Congressional committees we would be free to give the full story to the committee in executive session.

As the discussion progressed, both sides inclined toward the view that it might be preferable to confine the agreement only to the first 10,000 tons.

(It was later agreed that the deal should include only the first 10,000 tons.)

The United Kingdom stated that it was a condition of their offer that if the United States agreed to pay a higher price than $1.18 to other countries the price to them should be correspondingly increased, and that we should not bid in the Singapore market without first consulting with them. The reason for this proposal was because the British were taking the risk of having to buy tin in the open market and sell to us at a fixed price and if we should pay a higher price to someone else it would certainly raise the market price correspondingly. They felt entitled to protection if we found it necessary to take any such action.

It was suggested by the United States that we might wish to pay a somewhat higher price to Bolivia because of the higher costs prevailing for a large part of the tin production of that country. The British said that they would not object to any differential that was customary in the trade as between Bolivian and Malayan tin. The discussion on this point of a possible differential price was inconclusive and was left for further discussion.

Aluminum

The British agreed to supply aluminum at the rate of 5,000 tons per quarter beginning with the second quarter. In addition, they agreed they would definitely commit themselves now to supply in the second quarter the last 4,000 tons of the precious deal which was to be confirmed later by them.

The U.K. informed us they had no strategic stockpile of aluminum. They requested we be prepared to replace all of this aluminum [Page 792] to them, including the first 10,000 tons, by June 30, 1953. We informed them that if there were no delays in our expansion program it appeared likely we could do this but we wanted the privilege of reopening this matter with them if it appeared that our program was delayed.

Copper

In the case of copper, the U.K. advised that they would be unable to supply any refined copper but would consider supplying some brass strip if we would furnish them with our specifications. They promised to review the copper situation.

Steel

In the case of steel there was some misunderstanding as to how definite our discussions had been on January 7.3 The matter was finally concluded with the statement that their requirement for the year 1952, including that which had been allocated to them for the first quarter, was 1,250,000 tons which they could use in iron ore, ingots, scrap or steel, any iron ore shipments to be adjusted on a formula to be agreed upon.

They were informed there was little likelihood of our supplying them plates or structural and serious question as to our ability to supply them equal monthly shipments during the last nine months, and that it was possible we would have to ship the bulk of the tonnage in the last six months of the year. A task committee is to get together to reconcile the tonnage figures, and it was agreed that in arriving at these figures ingots and scrap would be taken on the basis of ton for ton of finished steel.

The U.K. claim their furnaces are now running at full capacity with low grade ore with 28% metallic content and that by the use of high grade ore of 60%, which had been offered to them through U.S. industry in the amount of 750,000 long tons, it would be possible for them to increase their steel output. They stated that the difference between the iron content of the high grade ore of 60% and that of their own low grade ore was 32% so that 750,000 tons of ore was equivalent to 250,000 tons of steel.

G. J. Ticoulat
  1. Drafted on Jan. 22. The conversation took place following the luncheon at the Treasury (see TCT CONV–7—Part I, supra) and before the fourth formal meeting between the President and the Prime Minister (see Document 344).↩
  2. For Parts I and III, see Documents 335 and 352.↩
  3. See Document 335.↩