File No. 656.119/23

The British Embassy to the Department of State


netherlands—importation of margarine materials

The British Government do not consider the present arrangement with the Dutch Government as to the importation of oils and fats into Holland satisfactory. They are therefore considering an arrangement with the Dutch Government by which either imports of raw materials for margarine should be reduced to such a figure as would compel the Dutch to consume their own butter and margarine or, failing that, an arrangement on the following conditions:

All raw materials imported from the United Kingdom and any part of the British Empire on British vessels to be used for the manufacture of margarine for the United Kingdom only;
All oils and fats imported from the United States to be utilized exclusively for the same purpose;
The Dutch only to be allowed for their own purposes a supply equivalent to 20 per cent of raw materials imported from other sources, i. e., oils and fats from South America and vegetable oils from the Dutch East Indies.

In any case the British Government proposes to insist on the entire suspension of the export of margarine from Holland to Germany.

The British Government will be glad to learn the views of the United States Government on any such arrangement. They understand that the United States Government do not contemplate giving licenses for the present for the export of oils and fats from the United States to Holland. It is assumed that they would be prepared to lay down in any case as a condition precedent to the grant of any such licenses that any such oils and fats should only be [Page 1126] utilized for the manufacture of margarine for the Allies. So far as exports from the British Empire are concerned, the dependence of the United Kingdom on Dutch supplies of margarine make it impossible for the British Government to suspend altogether exports to Holland of raw materials for this industry. Provided, however, that the condition of such export is that all the resultant products, with the exception of small quantities of fatty acids, are re-exported from Holland to Allied countries, there would appear to be little danger of increasing supplies available for Dutch home consumption, and thereby diminishing the efficacy of any proposals which the United States Government may contemplate submitting to the Netherlands Government, for the restriction of the export of Dutch home products to Germany.