119 Mr J. McEwen, Minister for External Affairs, to Mr R. G. Casey, Minister to the United States

Cablegram 166 14 September 1940, 4.20 p.m.

Your telegram 254. [1] Commonwealth Government decided on June 13th, 1940 against imposition of embargo on export of scrap iron [2] main reasons being (1) avoidance of further resentment in Japan following Yampi decision [3];

(2) export of any commodity is valuable at present for building up overseas credits;

(3) investigations show export of scrap not prejudicial to Australian interests and quantities available are in excess of current requirements.

Prohibition of export would lead to depreciation in price and injure Australian commercial interests.

1 Dispatched 12 September. See file AA:A3300, 45. It reported that the U.S. administration was moving towards a more severe embargo on oil, petrol, scrap iron and steel exports to Japan, and requested information on the present position regarding Australian scrap iron exports to Japan.

2 See Documents on Australian Foreign Policy 1937-49, vol. III, Document 221, note 4.

3 The Commonwealth Govt prohibited the export of Australian iron ore from 1 July 1938. See Documents on Australian Foreign Policy 1937-49, vol. I, Document 186 and statement of 19 May 1938 by the Prime Minister, J. A. Lyons, in Commonwealth Parliamentary Debates, vol. 155, p. 1260.

[AA:A3300, 45]