Swap

The U.S. Government, which went on a buyer's strike against world tin prices last March, ended it last week. The terms of the settlement were something less than a U.S. victory. They were part of a U.S.British swap of raw materials, worked out by President Truman and Prime Minister Churchill.

Britain will get steel--1,000,000 tons of it--in return for 20,000 tons of Malayan tin ore and 55 million pounds of Canadian aluminum. The U.S. will buy the tin outright at $1.18 a pound, f.o.b. Singapore. The aluminum will be sold by Canada*with the understanding that the same quantity will be sold back by mid-1953, when U.S. plants will have expanded enough to ease the present shortage.

The tin price was a compromise. The U.S. wanted to pay $1.12; the British producers wanted $1.25. Since Malaya produces 34% of the world's tin, the new price may well establish the price pattern for Bolivian and Indonesian metal. In any case, the new flow of tin from Malaya will ease the drain on the U.S. stockpile.

The British purchases of steel will not begin until the second half of the year, and will not force any cut in domestic allocations. The Defense Production Administration will specify what kind of steel Britain buys, and probably will not sell any in shortest supply.

* A year ago the Aluminum Co. of Canada, Ltd. offered to sell the U.S. 200,000 tons of aluminum over a three-year period at a cent lower than domestic prices, but the R.F.C. rejected the proposal after U.S. producers protested.

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