894.24/15193: Telegram

The Ambassador in Colombia (Braden) to the Secretary of State

393. For Finletter. Reference is made to the Department’s telegram No. 270, August 27, 5 p.m. Yesterday Minister for Foreign Relations handed me a memorandum giving the requirements of the five Colombian silk mills at 44,418 pounds per quarter, stocks now on hand amounting to 31,532 pounds although some mills, including Modelia, have less than a month’s supply. Memorandum states that while Colombian Government appreciates Department’s attitude in placing Colombian factories on the same footing as American as concerns rayon, local manufacturers claim it will take some time to adapt equipment to rayon and that natural silk must be obtained to prevent closing plants. If these allegations are untrue I would appreciate full information together with definite assurances of a rayon supply otherwise I recommend that the silk situation be earnestly considered, a prompt decision taken and we be informed by telegraph.

While we have succeeded in temporarily divorcing platinum and silk it is necessary that platinum negotiations be concluded without further delay and essential that the 62,376 grams of this metal now on hand be purchased at once.

Recent press articles state that because Japan is no longer purchasing, platinum price has fallen below that for gold. The Government in principle has accepted all our proposals. Therefore, I recommend that duly authorized representative of the Metals Reserve Company be sent to Bogotá by plane to conclude contract, organize the purchasing program, and instruct the Bank of the Republic in all [Page 51] details regarding assay shipment, et cetera. The only point still open for discussion is whether to set a price of $38 per fine ounce for the life of contract or to set prices for shorter periods; Chief of Exchange Control Office says either procedure will be acceptable.

Every day’s delay will further complicate the situation. Already “jewelers” in both Argentina and Cuba are reportedly making offers and with the Bank of the Republic unable to proceed or to offer to purchase platinum, prompt and immediate action must be taken.