Every American housewife has a part in this
diplomatic and economic drama. She reduced her purchases of high-priced coffee
to such a degree that 1954 consumption fell off six per cent from the 1947-1952
volume. And, of course she will benefit, if the 1955 futures level becomes
effective at the retail level.
American reaction toward soaring prices has
caused tremendous resentment. James S. Kemper, our Ambassador to Brazil,
recently predicted a sharp decline in price, leading to demands for his recall
on the ground that he has outlived his usefulness.
Foreign Operation Administrator Harold E.
Stassen then issued a statement completely contradictory to the FTC report,
which envisaged surpluses. He foresaw serious shortages, and urged that
Ethiopia be tried out as a new source of production, with American aid, of
course. Brazilians exploded at that.
Thus, in South America at least the coffee
bean has become as explosive an issue as the atom bomb at the State Department
and in the chancellories [sic] of Europe and Russia.
Coffee and
International Situation
By Ray
Tucker
November
24, 1954
WASHINGTON
- While American housewives complain over paying $1.13 a pound for coffee, the
American State Department is deeply disturbed over a prospective drop in prices
that will bankrupt several coffee-producing nations and render them more
susceptible to Communist infiltration in the vicinity of the Panama Canal.
As the
recent Guatemalan explosion revealed, all these countries - Brazil, Guatemala,
Colombia, Ecuador, El Salvador, Honduras, Haiti, Costa Rica and the Dominican
Republic - have been penetrated by Communist agents on orders of their masters
in Moscow. Their principal propaganda charges that there is an official and
unofficial American conspiracy against coffee.
They
find it easy to excite native audiences, for the United States is the principal
market for this staple crop. Moreover, South American anger has been stimulated
by Congressional denunciations and investigations of high prices, and by the
Federal Trade Commission's anti-trust charges against the New York Coffee
Exchange, with the implication that producers connive at gouging American
coffee drinkers.
U.S. Concern
State's
immediate concern arises from the fact that the future prices for September,
1955, for Brazilian coffee is about 52.35 cents a pound. This represents a
decline of 43.65 cents from last April's high of 95 cents.
If 1955
prices average around 55 cents, Brazil will lose an income of $550,000,000 a
year, and the other coffee-growing countries will lose proportionately. All
these countries are in financial straits now, and such a decline might ruin
them. Coffee accounts for from 60 to 95 per cent of their total national
revenue.
In
fact, the suicide of President Vargas of Brazil was attributed to his country's
desperate plight, and his inability to improve conditions. Coffee was selling
then for a higher price than it is now, or will in the future under present
prospects.
American Housewife's Part
Every
American housewife has a part in this diplomatic and economic drama. She
reduced her purchases of high-priced coffee to such a degree that 1954
consumption fell off six per cent from the 1947-1952 volume. And, of course she
will benefit, if the 1955 futures level becomes effective at the retail level.
The
difference between the New York futures and retail prices averages about 30
cents. When the New York figures was 95 cent last April, she was paying from
$1.20 to $1.30 a pound. If the New York price falls to 55 cents, the retail
charge should be about 85 cents.
American
reaction toward soaring prices has caused tremendous resentment.
Other Reasons for Hostility
Hostility
in the coffee countries has been provoked by other events. James S. Kemper, our
Ambassador to Brazil, recently predicted a sharp decline in price, leading to
demands for his recall on the ground that he has outlived his usefulness.
Foreign
Operation Administrator Harold E. Stassen then issued a statement completely
contradictory to the FTC report, which envisaged surpluses. He foresaw serious
shortages, and urged that Ethiopia be tried out as a new source of production,
with American aid, of course. Brazilians exploded at that.
Thus,
in South America at least the coffee bean has become as explosive an issue as
the atom bomb at the State Department and in the chancellories of Europe and
Russia. It will probably perk with enough force to dynamite the forthcoming
economic conference at Rio de Janeiro, Brazil.
[McClure
Newspaper Syndicate]
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Ed's Note: Coffee in Retrospect is a reprint column prepared by Coffee Monitor and Poor Farmer blog to provide context for the current global coffee trade by republishing news articles from the past. In this column, we intend to reprint archived prints by converting images into electronic file formats with careful conformity to originals and, whenever applicable and possible, we provide links to the sources of the information. Meanwhile, responsibility for the contents lies solely with the authors and the views expressed in the articles do not necessarily reflect our opinions.
Ed's Note: Coffee in Retrospect is a reprint column prepared by Coffee Monitor and Poor Farmer blog to provide context for the current global coffee trade by republishing news articles from the past. In this column, we intend to reprint archived prints by converting images into electronic file formats with careful conformity to originals and, whenever applicable and possible, we provide links to the sources of the information. Meanwhile, responsibility for the contents lies solely with the authors and the views expressed in the articles do not necessarily reflect our opinions.
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