381 Sir Earle Page, Minister for Commerce, to Mr R. G. Menzies, Prime Minister (in London)

Cablegram unnumbered 3 April 1941,

Information received from Casey [1] and Macgregor [2] indicates that representatives of British Ministry of Food are already in United States for purpose negotiating on Lend-Lease programme. We gather that 50,000 tons cheese, 100,000 tons of dried milk, 80,000 tons of pork, 100,000 tons of bacon, 45,000 tons of raisins and 1 million cases eggs are already in mind for transfer to United Kingdom.

We think this is admirable, but it disturbs us to think that it is the reason for curtailment of imports from Australia. For example, we hear that ready accessibility of bacon from United States under the new conditions is the reason for sudden cancellation of orders for baconer carcasses specially produced in Australia because United Kingdom Government expressed wish for them. Our total supply of pig meats, including baconers, was to be 25,000 tons for the year. The exclusion of baconers is of slight moment to United Kingdom but a severe blow to Australian industry.

We know that if shipping were available United Kingdom could do with food supplies from both United States and Dominions. I feel we must fight hard against the damage to our economy which the proposed restrictions would cause. Unless we do so United Kingdom will naturally make the arrangements which suit her best without realizing the effect on us. If we acquiesce, our economic interests will be damaged, and our war effort weakened.

Everything depends on shipping. The prospects of increased tonnage resulting from United States co-operation seem very favourable, and we have always understood that output of merchant shipping construction in United Kingdom and elsewhere would greatly increase early this year.

The seriousness of shipping position is always stressed but never explained. It constitutes a great arguing point in many ways. For example, it can be argued that food ships should not go to unoccupied France while the British meat ration is reduced, and shipping losses are high. Furthermore, the urgency of American help can be more strongly stressed when the shipping situation is displayed in its worst light.

Greatly trust you will be able to secure some firm understanding of their willingness to buy our surplus products. They did this for some products last war. It is more necessary to us now because of great development our export industries. If you succeed on the principle before you leave it will be a great achievement, will greatly help Bruce [3] after you leave, and will be best assurance that they will use every effort to send ships for the goods.

Macgregor is very well informed of all our economic interests in United States and is at present concentrating on the idea of a trade agreement. He is acting as liaison on Lend-Lease programme as it affects us.

1 Minister to the United States.

2 Government Trade Commissioner in the United States.

3 High Commissioner in London.

[AA: A3196, 1941, 0.4161]