RUBBER

Document Type: 
Collection: 
Document Number (FOIA) /ESDN (CREST): 
CIA-RDP78-01617A000200140005-6
Release Decision: 
RIPPUB
Original Classification: 
T
Document Page Count: 
2
Document Creation Date: 
November 9, 2016
Document Release Date: 
July 28, 1998
Sequence Number: 
5
Case Number: 
Publication Date: 
November 17, 1948
Content Type: 
IM
File: 
AttachmentSize
PDF icon CIA-RDP78-01617A000200140005-6.pdf105.91 KB
Body: 
IM - 73 Sanitized - App yed or Release_-., J; ~17A000200140005-6 Director of Central Intelligence Assistant Director for Reports and Estimates Rubber 1. recent efforts of the USSR to obtain rubber in Ceylon, following unusually large purchases in Malaya earlier in the year, was the occasion for a meeting of representatives of interested agencies at the Department of State on 17 November to explore possible action to be taken in order to prevent the USSR ron obtaining Ceylonese rubber. Those present at the meeting were: Department of Commerce - F.G. Holt S.E. Overley Economic Cooperation Administration - Arthur Cox H.B. Leggett Munitions Board - Colonel W.H. Crom Charles Sullivan Frederick Bates National Security. Resources Board - Arthur Wolf Fred vlinant Department of State - Donald Kennedy William T. Phillips R.G. Hooker E. Dahl Gregory Grossman V'I .C. Armstrong George H. Alexander Central Intelligence Agency 2. It was the opinion of those present that notning could be done to prevent Soviet procurement of Ceylonese rubber in the near future. it was felt that preclusive buying is not now feasible because it would invite Soviet retaliations on manganese and chrome. Futhermore, in view of a probable world surplus of rubber, the USSR could turn to other areas such as Siam. 3. The PJ;unitions Board cannot now purchase Ceylonese rubber under its stockpiling program because it has completed its procurement program through the first half of. 1949 and has no more funds available. The ECA has counterpart funds in Italy and possibly France, and was requested to study the possibility of transferring part of these funds for purchase of Ceylonese rubber at market prices. 25X1A9a Sanitized - Approved?Fpr,.I elea e :: P78-01617A000200140005-6 25X1A9a Sanitized - ApprQ pd R I q i R 000200140005-6 Director of Central Intelligence 4. The Department of State was requested to prepare for a conference on the subject with the new Ceylonese Ambassador. The interested agencies were requested to study the possibilities of a general Government program for purchase of rubber so as to reduce the supplies available to the USSR. Without the cooperation of other countries which control rubber producing areas, however, action by the United States along probably could not be very effective. The United Kingdom has already arranged for its short- term supply of rubber and is apparently unwilling to participate in such a program: 5. It was felt that the Soviet request for a government-to- government agreement with Ceylon on rubber, as proposed by the USSr:, would not be concluded because of the pro-western leaning of the Ceylonese Government, but that lack of such an agreement would n* prevent the .>oViets from procuring rubber through private transactions. 6. Ceylonese rubber is high cost and unless a price of 22-4 cents per pound or better (compared with a current price of l-f/8 cents on the New York market) is received, much rubber acreage is likely to be diverted to other crops. Ceylon has approached the United States regarding the purchase of 194?-49 rubbc?r production and also on a long-term contract. Bo decision has been made on this matter, and the possibility exists that Ceylon may be using the Soviet inquiry as a lever to obtain more favorable terms from the United States. 7. In view of these developments and other events as reported in IL-73, it now appears that the USSR may obtain adequate supplies of natural rubber both for current consumption and stockpiling. F/Fo THEODORE BAB31I TT Assistant Director Reports and Estimates Orig. & 1 - Director 2 - Ass't Dir., ORE 1 ST I G, ORE 1 - P Re Sanitized - Approv n: P78-01617A000200140005-6