Coffeeplot

After years of futile palaver, Latin America's coffee-producing nations are finally getting together in a hard-boiled cartel to hold up the price of coffee. This week their coffee policy-setters are busily bolting together a machine that, if it works, should take enough of the surplus off the market to sustain or even raise the retail price through the rest of 1955.

The combine being formed is largely the work of Manuel Mej`ia, shrewd czar of the Coffee-growers' Federation of Colombia, No. 2 among the producers of the world's annual coffee crop of some 32 million 132-lb. bags. In 1953, when Brazil (the No. 1 producer) suffered severe frosts, Mej`ia happily sold Colombia's crop at the high prices that resulted. In 1954, when Brazil made a quixotic effort to keep prices high by refusing to sell for less than 87-c- a lb. (wholesale), Mej`ia craftily undersold--and again unloaded his country's crop. But after Brazil dropped the floor price to 53.8-c- and began muttering sullenly of dumping the 6,000,000-bag surplus that had piled up in 1954, Mej`ia undertook a series of solicitous, persuasive trips to Rio de Janeiro.

The result was an agreement initialed by Mej`ia and Brazilian officials in Rio last fortnight. This week, in San Juan, Puerto Rico, Mej`ia put it up for endorsement by the twelve other producers--Mexico, Guatemala, El Salvador, Cuba, Ecuador, Dominican Republic, Nicaragua, Haiti, Panama, Honduras, Puerto Rico and Venezuela. The deal provides for 1) taking all unsold stocks off the market before July 1, when new crops begin flowing in, 2) withdrawing from the market 3,000,000 bags of the incoming crop, prorated among the countries. No one has said what will be done with the surplus, though Brazilian spokesmen angrily denied any plan to burn excess coffee, as in the 1930s.

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