My telegram No. 912 of April 29th† regarding Mr. Howe's trade talks with United Kingdom Ministers:

1. Mr. Howe had a long talk with Mr. Strachey, Minister of Food, on April 29th, and a talk with Mr. Harold Wilson, President of the Board of Trade, yesterday afternoon, May 2nd. These two talks were both still part of the exploratory state, but as a result it is now possible to give some indication of what we may expect to result from Mr. Howe's mission to London.

2. As regards timber, the United Kingdom Government proposes to authorize the Timber Control to place immediately an order for west coast woods to the amount of ten million dollars, which is to be competed for freely by exporters both in Canada and the United States, price being the determining factor as to who gets the order. It has now been confirmed that this immediate order is to be in addition to the arrangements for additional quantities to be contracted for by the Timber Control during the remainder of this year. The Timber Controller indicates that he has in mind additional orders for between 90,000 and 120,000 standards, but still awaits Treasury authorization. It has not yet been decided as to whether these additional quantities should be divided between Canada and the United States or left for free competition as in the case of the immediate order. Much will depend on how the immediate order works out, and the Treasury will also wish to have more experience of the financing of wheat purchases with earned dollars. The immediate order for timber is to be financed with ECA dollars, and ECA approval in principle already has been obtained ⁴⁴

3. As regards canned salmon, the amount mentioned has been $7,200,000, purchase to be made from 1949 production. This also it is hoped to finance with ECA dollars.

4. As regards apples, Strachey indicated that only a token amount could be allocated for the importation of apples, both from Canada and the United States.

5. Strachey held out little or no hope for purchases of other commodities mentioned by Mr. Howe, such as processed milks, beans, peas, berries, tomatoes and honey, although he expressed his interest in additional quantities of cheese.

6. The discussion so far has been on the basis of utilizing the shortfall of bacon shipments to cover the purchases of the additional quantity of timber, canned salmon, and apples, but Sir Henry Wilson Smith told Mr. Mackenzie that before the latter left London he would like to discuss with him the proposal regarding the financing of Shell Oil operations. It is possible that the United Kingdom Government has in mind our concurrence in the Shell Oil proposal as part of the general settlement, although no statement to this effect has been made.

7. The exploratory conversations with individual Ministers will continue, after which it is expected that a full meeting, attended by all the United Kingdom Ministers concerned, similar to the meeting held on the morning of April 29th, will be arranged to bring matters to a finality.

⁴⁴Cel engagement provisoire devint plus lard un sujet de controvcrse cane Howe et Wilson. Voir DEA/824-40 pour les échanges plus tard au cours de I~année.
This tentative commitment later became a point of dispute between Howe and Wilson. See DEA/824-40 for exchanges later in the year.