FACTORS AFFECTING FUTURE OF US COPPER COMPANIES/NEW MINERAL POSSIBILITIES/COMMUNIST INFLUENCE IN NITRATE FIELDS/MAN IN THE STREET OPINIONS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00809A000500330027-3
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 3
• Document Creation Date: December 14, 2016
• Document Release Date: March 1, 1999
• Sequence Number: 27
• Publication Date: December 15, 1953
• Content Type: REPORT

Approved For Release 2001/09/11: CIA-RDP80-00809A000500330027-3
U.S. Officials Only
CONFIDENTIAL
CENTRAL INTELLIGENCE AGENCY
INFORMATION REPORT
SUBJECT Fantors Affecting Future of US Copper Companies/New
}Linoral Pos aibilities/Conviuniat Influence in Nitrate
Fields/Man in the Street Opinions
PLACE ACQUIRED
(BY SOURCE)
DATE ACQUIRED
(BY SOURCE)
DATE (or INFO.) Sep 52 to Sep 53
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or 00* ~0,rtO 111011. .,101.001$1.0100 0r 111.1 ,I. .1011000 101
?,0 r .r 104 ..I 0001. ?I ?$1,310. ,rI 1..0I$,II,0w 0. .[r[.
L?1,0010* , V. 000X0?, 00 0? .101(9? 1? II u?U100t( tI RI10, ,I
DATE DISTR. /5 Dec 53
NO. OF PAGES 3
NO. OF ENCLS.
SUPP. TO
REPORT NO.
1. An inoraaso of Chilean administrative controls over US-owned copper companies,
and oven the possible nationalisation of those oompenles, is a favorite topic
of convoroation among Chileans connected with the mining industry. If I wore
a US amier of a copper company in Chile I would be nervous about the under-
ourrunte I found during my year in Chile affecting the statue of foreign
copper interuets. Thn Chileans are watching both Peru and Bolivia very closely
for signposts of the future. If Bolivia makes a reasonable success of its tin
industry, thoro is no doubt in my Judgment that the US copper companies will
be in trouble.
2. The Peipoto copper smelter is instructive. The Chilean Government put up the
funds to build It, and when it was found that the smelter was not getting the
needed ore, copper ore concentrating mills were constructed to keep it supplied.
Then it. turned out that there was enough not enough ore to keep the concentrating
mill* busy, and an several popper mines were bought. The whole operation is
still small but the pattern is potentially dangerous to the U8 firms. All of
the output of the Paipote smelter, which is run by a Ahito Russian named
Zaue uivitoh assisted by a German and a Yugoslav, is being sold to Ooraasp
'CMeral Ropublio). I did not learn the identity the German oonsignee(s) but
the sales are being negotiated in Santiago by a P aipote smelter representative
and I think the prior, an of September 1953, was US 32 cents a pound. The
smoltorta Capacity is 50 tons a day. Gold and silver in the ooppor is being
recovered In Germany.
3. I hoard nothing to indicate Chilean ooppor sales to other countries or the
possible trwsahlpmont to the Soviet bloc of the copper which in being sold
to Germany. But neither did I observe anything suggesting that the Government
is eonoarnod about transshipments or has established machinery to prevent or
discourage it. LQy contacts with Chilean officials convinced me that price
alone will dotormino copper polioioc. If the Chileans fool they oar got more
for their copper, they will do the thing which they believe necessary to got it.
0^'7FIDRNTT at
L A T P A GE FOR S i.l .JriCT & AREA C.
This report Is for the use within the USA of the intelligence components of the Departments or
Agencies indicated above. It is not to be transmitted overseas without the concurrence at the
originating ofllce througl, the Assistant Director of the Office of Collection and Dissemination, CIA.
Approved For Release 2001/09/11: CIA-RDP80-00809A000500330027-3
 Approved For Release 2001/09/11: CIA-RDP80-00809A000500330027-3
f~jXq%ng are acme of the presently unexploited miner
Cbile
(a) Some years ago a copper dopoeit in the Collahuasi area was mined
by a UK firm which abandoned operations when the copper content
of the ore deolin5d to 20%. This deposit and several others like
it in the sans area are available for additional economic exploitation.
(b) A Canadian firm has located popper along the coast north of the
Camarones River. My understanding is that these are good sized
deposits with attractive profit possibilities given a stable
political outlook over the next few years.
(o) Mining geologists are generally agreed on the strong possibility
of tungsten and .. yh ltrun 'nposits in Qrue.
(d) Vary good lead deposits have been found in southern Chile in the
Puerto Aysen area. I hoard indirectly that there was a chance of
other mineral deposits in the area but I did not hear what they
might be. The lead findings here and the possibility of additional
ores has exacerbated Chilo9s occasional border difficulties with
Argentina. Lake Buenos Aires outs across the boundary at this
point and there are intermittent border skirmishes which the
Chilean Government has been afraid to publicize.
(a) A Chilean acquaintance mentioned casually to me that there are
uranium prospects in the Andes, but he volunteered nothing beyond
that and I did not see fit to press him.
5. Oommnanist agitation is fairly heavy in the nitrate towns of northern
Chile where the people, extremely poor and discontented, are in a
mood to listen to anything. Communist agitators are also working
over into the popper areas. The walls of buildings in the northern
towns are plastered with Communist posters calling for nationalisation
of mines (an issue on which the Communists can make town cause with
some anti-Oonmmnist Chileans), and attacking int1 tion and crooked
politicians. I suspect the Ooaunists are rather strongly ent-,mohed
in the nitrate unions and panibly in the copper mining unions as well.
The Chilean Communists in the mining areas employ the baser and sickle
as a revolutionary symbol but make no attempt to sell the USSR or eq
other Oommmnist country to the people. Occasional demonstrations
organised by the Communists are quickly broken up by the oarabinieri.
My general lapression, besed on considerable contact with the people
in small. towns throughout Chile, is that the Communist campaign has
thus far been really effective only in the nitrate fields.
He thinks all US citizens are millionaires and he neither likes nor
dislikes them.
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He is disappointed that IbGioa has failed to nationalise parts of the
ooonoay, in contrast to the wealthy Chileans who continue to fear that
Ibanez may do no.
He wants a land reform program, if he is a farmer.
He worries more about the price of copper than about anything also.
His second greatest worry is inflation.
He has practically no interest in international affairs outside the
Western hemisphere and he has no idea as to what the Korean War has
all been about. But he )mows there has been trouble in a place called
Korea.
He is interested in affairs in Venezuela, Colombia, Brazil and the other
Latin American republics and is not badly informed on these planes. A
surprisingly large number of Chilean work-era have radios.
-end-
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