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Colonies have been better off than the Eastern Colonies as regards the amount of freight available to bring their produce to the United Kingdom; but the price of kernels in West Africa has been considerably lower than before the War. In the case of the Eastern Colonies, the position has been even more unsatisfactory, as there has for a great part of the time been but little freight available for coconut oil or copra to the United Kingdom or France, though recently matters have improved as regards coconut oil from Ceylon. But during all this time the Colonies have at the request of His Majesty's Government imposed restrictions on the exportation of oleaginous produce to foreign countries, which have materially aggravated their difficulties. At first the restrictions imposed were framed by His Majesty's Government simply to prevent the produce reaching enemy countries; but since about the beginning of 1916 another object has come more and more into prominence: viz., to secure supplies for this country or for our European Allies-and to secure them as far as possible without too much competition from other countries as to price. Early in 1916 the Colonies were instructed to prohibit the export of oils to all destinations outside the Empire and of oil seeds to all foreign countries except France, Italy, and Russia. In the case of palm oil, which is obtained from the same tree as palm kernels, prohibition of exportation from British West Africa except to the United Kingdom was imposed at the request of the Controller of Oils and Fats in the summer of 1917; and in 1918 a similar prohibition was imposed on the export of Ceylon coconut oil, except that exports to India were not prohibited.

During the War, the Colonies affected have acquiesced in this restrictive policy, though it deprived their produce of "safe" and remunerative markets-for prices of oleaginous produce have generally been much higher in France. Italy, and the United States of America than in the United Kingdom. But though they have acquiesced in these restrictions during the War and their resulting losses may be regarded as a sort of War contribution, the position is materially altered now that the War is over.

It is a primary feature in British Colonial policy that the interests of the Colonies ought not to be sacrificed to the interests of the United Kingdom, and if the Colonies are to be asked to continue for a time to restrict exports in the interests of the United Kingdom (or of France. Italy, or Belgium) it will be necessary for His Majesty's Government to secure to the Colonies affected a fair price for their produce-fixed with due regard to the fall in the purchasing value of money in the Colony-as well as shipping to move it and facilities for obtaining packages in which to export it. How a fair price should be secured will have to be decided according to the circumstances of each Colony and article. Under present arrangements coconut oil is purchased in Ceylon and the Straits Settlements by the Ministry of Food, the Colonial Government acting as the Agent of the Ministry for the purpose. In the case of coconut oil produced in the East, the best arrangement may be for His Majesty's Government to enter into contracts with the crushers to buy all or part of their output for a few years after the War. Whatever arrangements are adopted for controlling copra and coconut oil, it will be essential in dealing with the Straits Settlements to bear in mind the considerations mentioned in paragraph 21 above if anything but harm is to be caused by an attempt to control the exports from that Colony; and it will probably prove necessary to treat the Straits Settlements in a manner different from that adopted in the case of countries like India and Ceylon which produce the copra which they export or make into oil.

36. In the case of British West Africa palm kernels a restrictive policy has already been sanctioned by the Secretary of State for the Colonies on the recommendation of the Committee on Edible and Oil-producing Nuts and Seeds (Cd. 8247). It is proposed to impose for five years after the conclusion of peace an export duty of £2 a ton on all palm kernels from British West Africa shipped to a port outside the Empire. The object of this proposal was to encourage crushers in the United Kingdom to crush palm kernels by protecting them for five years against German competition. It seems probable, however, that an export duty, unless it is a very high one, will not at first be sufficient to prevent Germany from buying palm kernels, either on the West Coast or in the United Kingdom, and either exporting them to Germany direct or reshipping them from the United Kingdom. The demand in Germany for palm kernels will at first be so strong that the crushers will probably be willing to pay considerably higher prices for them than those ruling in West Africa or the United Kingdom, and it would seem desirable that a more certain control should be obtained during the period immediately after the War, either by licensing exports or by a system of Government purchase.

37. Cotton-seed Oil.—Unless the world's crop of cotton in the year after the War is a very large one the British and German demand for cotton-seed may exceed the supply

which is readily available, and control of the exports from at least Egypt and India will be desirable.

38. There should be no difficulty in obtaining within the Empire the 183,000 tons of ground-nuts required by the United Kingdom, and, so far as British needs export of the Gambia and Nigerian ground-nuts is controlled, it will probably be unneces- go, if the sary to adopt special measures in the case of the less needed Indian ground-nuts. Indian ground-nuts are of great importance to France, whose supplies may be imperilled if Germany is allowed to buy without restriction in the Indian market, and therefore some measure of control over Indian ground-nuts may be advisable.

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39. As regards linseed, it may be assumed that after the War the Canadian surplus, unless a very large one, will continue to be absorbed by the United States of America, which will also require some portion of the Argentine crop. Germany will no doubt obtain its linseed mainly from Russia and the Argentine. If the crops in those countries are large it may not be necessary to control the exports of linseed from India, but other- wise it will probably be desirable to do so, and arrangements should be made so that it can be done if it is found to be necessary.

40. As regards palm oil, the position would seem likely to be such that shipping considerations will bring to the United Kingdom as much as will meet our requirements. It will probably be advisable to prohibit the export of palm oil from this country except under licence; but, if so, the licence system should be worked solely with a view to conserving an amount of palm oil adequate to the real needs of the United Kingdom, and not made a means of securing cheap oil for the United Kingdom soap maker to the detriment of the native producer.

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41. As regards other oleaginous produce, so far as can be seen at that no special restrictions in countries of origin will be necessary as regards castor-seed,

present, it rape-seed or sesame, all of which are produced in India. however, were recently (August, 1918) of a contrary opinion as regards castor oil in view The Ministry of Food, of the amount of this oil which it was expected would be required for war purposes. Soya beans are not produced in any quantity in the British Empire, and no special measures seem to be necessary with regard to them.

42. With regard to animal fats, if shipping can be made available, Australia and New Zealand should be able to send more premier jus to the United Kingdom than hitherto, but the bulk of the increased supplies of animal fats required for margarine making will presumably have to come from the Argentine and the United States of America.

43. This memorandum does not deal with ordinary cooking lard, nor with such oil-seeds as Niger seed, mowra, poppy seed, and Shea nuts, &c., which are not used in this country on a large scale. The first three were mainly exported to the Continent, and will probably continue to go to the Continent after the War. To the extent to which they do, they will relieve the demand of the Continent for those oil-seeds which are more wanted in this country; but their total export will not greatly affect the position; they are comparatively small crops.

44. Much of the information embodied in this memorandum has been supplied to the Colonial Office by Mr. A. Mansfield, C.B.E., the Director of the Oils and Fats Section of the Ministry of Food.

COLONIAL OFFICE,

18th June, 1918.

(Revised 11th November, 1918.)

PUBLIC RECORD OFFICE

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Reference :--

885/26

PUBLIC RECORD OFFICE, LONDON

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