711.329/9–1347: Telegram
The Acting Secretary of State to the Embassy in Brazil
1226. Reurtels 1279, Sept. 13, and 1468, Oct. 24,1 please notify Brazilians by formal secret note that this govt is pleased to learn that Brazilian Govt is ready to discuss further procurement of Brazilian monazite by this country and takes the opportunity to give formal notice that it intends to exercise the option reserved to it in para. 5 of the Agreement of July 10, 1945. The US Govt is prepared to review with the Brazilians prices, quantities and other matters pertinent to an extension of the agreement on mutually satisfactory terms.
During the period covered by US options, this govt considers that all parts of the Agreement of July 10, 1945, continue in force unless modified by mutual consent, including para. 2 which provides that there shall be no shipments of monazite to any consignee not approved by the US Govt.
At same time you present note in above sense you may refer orally to reports that French or other interests are trying to make arrangements for delivery of monazite in the future and indicate in appropriate fashion that any commitments in this sense would, of course, be contrary to the agreement, while negotiations with such interests would seem to be inconsistent with its spirit.
For your info, Dept. considers that form of present agreement gives us sufficient flexibility for either direct governmental or private purchases; and that the negotiation of an entirely new agreement might give an opportunity to influential members of National Security Council2 [Page 848] to confuse issue or press for arrangement less advantageous to us. Suggestions on proposed renegotiation will follow shortly; in meantime any comments by you will be welcome.