Evening star. [volume] (Washington, D.C.) 1854-1972, 1951-02-25

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supplies and prices are smaller
carry lovers, rising production and
transportation costs. Practically
all exports SURPRISES Of past years
have now been sold. In fact, there
is so little coffee left in the coun-
try, until the Brazilian is now pay
ing almost as much for his coffee
as the consumer in the United
States. A pound of coffee in Sac
Paulo itself retails for approx
mately 80 cents in United States
money, which, for the Brazilian
workingman, is exhorbitant and
almost prohibitive. This, in spite
of the fact that there is also a
ceiling price, both for whole
salers and retailers.
Freight rates from the interior.
from the farm to the seaport, have
gone up. Other charges. such as
taxes. the cost of bags, brokerage
fees, port charges and dozens Of
other items connected with pro-
duction and export have increased
in proportion. On top of this
steamship rates from Brazilian
ports to the United States have
been mounting and are destined
to go higher. Today. 1t costs $l.45
to transport a bag of coffee from
Santos to New Orleans or New
York. On March / the rate is
scheduled to rise to $1.60 bag.
Unless there is an about war
with Russia, involving Western
Europe and Southwest Asia,
United States consumers will not
have first call upon Latin Amer
lean coffee, as they did through
out World War II and for some
time afterward. The United States
is not the sole market as it was
in those years. The normal chan
nels of trade to practically all the
world are and will remain open.
The seas are completely free to
the ships of all nations, including
those of Russia. Our neighbors,
and especially Brazilians, are able
to sell their product wherever
they wish. European countries,
including Western Germany as
well as Russia, are again able to
buy coffee.
Reaction to Freeze
There are also political aspects
of the coffee trade. In spite of
high prices, today Brazilians, as
we'll as other Latin American pro-
ducers. are still smarting about
the sacrifices they made during
and after the war, and the low
prices at which they are COM
PEELED to sell their most important
export. Although in 1850 United
States importers were compelled
to pay an average of 81 cents a
pound for green coffee, in 1910,
and for several years before and
after that, they paid an average
of only cents a pound.
Brazilian opinion about the
freezing of prices in the United
States is very much divided. One
group, made up of the most lib
eral and far-seeing experts, feels
that the ceiling, which is based
on the highest figure at which
coffee was selling between Deem
Der, 1850. and January "a, 1851,
or SIS cents pound for green
coffee. is about as much as the
traffic will bear. They were al
ready afraid that if prices rose
much higher. there would be a
decrease in consumption, thereby
causing cutting of imports.
Many others are quite sure that
prices would have risen at least
5 or 6 cents pound more
within the following weeks, and
they are bitterly disappointed that
the ceiling was clamped down so
soon. All are agreed that there
ought to be a floor under, as well
as a ceiling, over prices, and they
want that floor price to be the
same as the ceiling price. ,
Nor should we overlook the fact
that a new nationalistic govern
ment has just been installed,
which has pledged itself to pro-
mote and defend the national cof-
fee industry against any and all
conditions and developments that
might seriously affect prices and
production. The new Minister of
Finance, as well as the new presi-
dent of the Bank of Brazil, the
two men who administer the
economy of the country, are both
ardent Paulistas. They are likely
to use every means at their dis
posal to prevent any fall in prices
Ct this most important dollar crop
of their state and the most i'm
portant export of their nation. In
his inaugural statement, Horacio
Latter, the Minister of Finance,
stated that: ANY one who per-
mits or attempts any injury to
the coffee industry is an enemy
of Brazil"
Pasis of Exchange
In spite of such implications,
the most responsible observers
here agree that there is not very
much the government of Brazil
could do in the way of placing
restrictions on prices or exports.
AS they see it, the only drastic
step possible would be for the
government itself to buy up the
coffee from producers and hold
it for a higher rate.
But, this is not likely to hap
pen until there is again a surplus
production. Coffee is the cash
crop of the country and the basis
of its exchange. Both the pro-
ducers and the government are
not only anxious for, but in need
Of, a steady dollar income. The
government must have larger
amounts of revenue at once to
carry out it's campaign promises
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