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ANNEX

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Page 11406488 (No. 1200 FERTILE) Page 19 € 488

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1949, from Washington to the Foreign Office

Wheat Conference.

Acheson spoke with me today about the Inter- national Wheat Conference and told me that the United Kingdom price proposals notified in Foreign Office telegram No. 2124 had been discussed with the President, the Secretary of Agriculture, and Senators associated with the farm groups. The considered view of the United States Government which he had to put forward was that the maximum price of $1.75 proposed was not acceptable but that the United. States would agree to and settle for a maximum of $1.80 with $1.20 at the minimum. I reminded Acheson that our offer was of $1.75 at the maximum with $1.10 at the minimum and that any possibility of concession at the minimum was dependent on a willingness on the part of the United States to settle. But he repeated that the United States could only agree upon a maximum of $1.80 with a minimum of $1.20 and pressed me to find out whether His Majesty's Government would settle on these terms. Thus for the first time we have been presented with a definite. United States Government position.

2.

If no wheat agreement is concluded there is, to say the least, the probability in our view of difficulty over the financing through E. C. A. of United Kingdom purchases of Canadian wheat. Consequently it seems to us here worth con- sidering the possibility of accepting a maximum price of $1.80 instead of $1.75 if in return we can secure agreement upon a minimum of $1.15 instead of $1.2/sic

3.

asked.

We are taking soundings with the representatives of other importing countries and will let you have a more con- sidered and informed view tomorrow.

J

B. Copy of telegram (No. 1232 FERTILE) of 2nd March,

1949, from Washington to the Foreign Office

My telegram No. 1200. Wheat Conference.

During the course of the day we have taken soundings among exporters and the leading importers about the United States price proposals. The general conclusion to which we are driven is that the United States will be able to keep all the other exporters behind her and that in the last resort she would be able to bring all the other importers over to her side.

2.

So far as concerns the exporters Canada is in the weakest position. If we were dealing alone with her we feel that we could force her to agree to prices of $1.75 at the maximum and $1.10 at the minimum. But she will of course shelter behind the other exporters. The new position which Australia has taken up since 24th February, as reported in Amaze No. 9458 has tended to encourage the United States to refuse to consider any lower maximum than $1.80 with a minimum of $1.20. One other factor which may have con- tributed to the new rigidity in the United States position is the reference in the Economist of 26th February implying that the UniPage 188elegation has been unPage $$4f488ough on prices and that a maximum price of $1.85 would not be unreasonable.