Message to the Senate on the International Coffee Agreement.

To the Senate of the United States:

A year ago this month, I met with the leaders of the American states in Punta del Este, Uruguay. In that historic meeting we reinforced the bonds of friendship that link this Nation with our 230 million neighbors to the South. We pledged to continue and extend hemisphere cooperation.

Today I recommend that the Senate renew and strengthen one of the most important economic agreements of our time--the International Coffee Agreement, which expires in September 1968.

The Coffee Agreement was born in 1962 as a first fulfillment of the Alliance for Progress. More than 60 nations joined together in that Agreement. President John F. Kennedy hailed it as "a heartening example of international cooperation to resolve a vitally important economic problem."

That problem, in its broad dimension, was to stabilize world coffee prices to benefit both the coffee producer and coffee consumer. For years, wide price swings had wasted the resources and hindered the growth of developing nations who depend so heavily on coffee exports.

Coffee is the economic lifeblood of more than 40 developing nations--from plantations to small cooperatives, spanning Latin America, Africa and Asia. Second only to petroleum as a source of foreign exchange for developing countries, coffee exports yielded over $2.3 billion in 1966. These exports have helped to build schools, hospitals, factories and roads--the pillars of peace and progress. And they have provided the funds for the growing nations to buy the products of America's farms and industries.

America is a nation of coffee drinkers. We consume about half the supply of traded coffee. Our coffee industry is the world's largest. We must assure the American consumer all the coffee he wants at fair and reasonable prices.

The 1962 agreement--which the Senate ratified in 1963--has done the job of promoting price stability for coffee consumers and producers alike:

--Coffee import prices have been fair. They are almost 25 percent lower than the average price between 1953 and 1962, and 10 percent higher than during the world coffee slump of 1962.

--The sharp price fluctuations that plagued the world coffee market in past years have been avoided.

--Coffee consumers and roasters have been assured steady supplies at predictable and stable prices.

The 1968 agreement I propose will extend this record of success. It builds on the experience we have gained over the last several years by:

--Assuring that different types of coffee will be available at fair prices to meet changes in consumer tastes and preferences.

--Providing fair treatment in trade for all forms of coffee.

--Attacking the problem of coffee surpluses by production control and by creating a Diversification Fund to encourage shifts to other crops.

Woodrow Wilson once said that "the highest and best form of efficiency is the spontaneous cooperation of a free people." Nothing so embodies that philosophy as the International Coffee Agreement. It shows that large industrial nations and small developing nations--guided by the principles of self-help and harmony--can work together for the benefit of all.

That good work has been carried on for the past five years. Through the International Coffee Agreement the machinery of economic cooperation is now in place--tested over the years and now improved.

Without that machinery, we could return to the days of ruinous coffee price swings, disrupting the economies of many friendly nations, impairing world coffee trade, and endangering the continued flow of coffee at reasonable prices to the tables of American families.

I urge the Senate to give this instrument of international cooperation its early and favorable consideration.

The Secretary of State will shortly submit legislation to implement the agreement.

LYNDON B. JOHNSON

The White House

April 23, 1968