257 Mr A.T. Stirling, External Affairs Officer in London, to Lt Col W.R. Hodgson, Secretary of Department of External Affairs

Cablegram 513 LONDON, 30 September 1939, 7.43 p.m.

PERSONAL FOR COLONEL HODGSON MOST SECRET

High Commissioner [1] has obtained the following from the British authorities:

'It has been learned from an entirely reliable source that the Japanese Foreign Office have instructed their Consul General at Sydney [2], in regard to his negotiations for the purchase of Australian wool, at once to endeavour [to] obtain before the Anglo-Australian Agreement [3] has been concluded, the quantities required by Japan. His instructions as to the line to be taken in these discussions are:

(a) that re-sale of wool is out of the question. As to re-sale of woollen goods Consul General is not, in view of Japanese policy of nonintervention in the European war, to volunteer a guarantee that woollen goods will not be exported to Germany or Soviet Russia.

But, if Australian Government affirm that such a guarantee is a necessary condition for sale of wool, he is to reply on lines that Japanese Government is forced to accept.

(b) He is to say greater part is for military use and he can add minimum requirement for this purpose is about one hundred thousand bales merino one hundred thousand of miscellaneous wool.

(c) The Consul General is to remember the desirability, from Japanese viewpoint, of avoiding transfer of negotiations to London.'

STIRLING

1 S.M. Bruce.

2 Masatoshi Akiyama.

3 The Agreement covered the purchase by the United Kingdom of all Australian wool available for export.

[AA: A1608, L37/1/5]