The ratio which the domestic crop bore to our total consumption must naturally have had the effect of lowering prices. Because of an early frost and a consequent crop in Louisiana in 1835 (only 27,000,000 pounds), we imported 65,000,000 pounds more in 1836 than in 1835, and the price of mucovados advance from 24 and 4 cents to 11 cents here, and to 6 and 7 cents in Habana, showing quite clearly the depressing effect which a good crop of domestic sugar had on prices here. Our imports of sugar, because of this, in 1836 were 191,426,000 pounds; in 1835 they were only 126,000,000 pounds; increase, 65,426,000 pounds, and this increase cost us $2,854,046. The crop in Louisiana in 1836-37 was favorable, and our imports fell 55,000,000 pounds compared with 1836 and prices of sugar receded to 5 and 6 cents a pound in New Orleans and to 4 and 5 cents in Cuba. In 1842 the Louisiana crop was heavy and prices fell off to 24 and 4 cents. The crop in 1843-44 was short and prices again advanced to 54 and 7 cents. The effect of supplying and deficit abroad has been the same as here. In England, in 1834, oversupply of sugar in the world, compared with 1833, produced a decline in the price to about 63 mills a pound. In 1835 a short supply, compared with 1834, produced a rise in price of about 13 cents a pound. In 1836 an oversupply, compared with the previous year, produced a decline in price of 33 mills per pound. In 1837 a short supply, compared with 1836, produced an advance in price of 1 cents per pound. In 1838 an oversupply, compared with 1837, produced a decline of over 2 cents per pound. In 1840 a short supply, compared with the previous year, produced an advance of nearly 4 cents per pound. It can be claimed with some considerable degree of confidence that these facts establish First. The importance to the people of this country of the domesticsugar industry in the past, in keeping a great deal of money at home that otherwise must have been sent abroad for foreign sugar to fill the void that would have existed but for the domestic product. Second. The importance of the effect of the domestic product in steadying and reducing prices that would otherwise have prevailed, clearly shown by the increase in price of sugar in 1836 and in 1857 because of short domestic crops in 1835 and 1856. For at least eleven years, 1851 to 1861, our people had the advantage of the lower price of sugar which an average of 39 per cent of any domestic product naturally gives. Our figures show that from 1851 to 1861, both years exclusive, the average per cent of domestic production compared with our total comsumption was nearly 37 per cent, making no allowance, however, for the failure of crops in 1856; while, if we exclude 1856, the average of domestic for the eleven years was 39 per cent. 66 Third. That the increase in domestic sugar production, comparing 1851 with 1861, was nearly 118 per cent, which fact, in connection with what we have stated, disproves the oft-repeated assertion that sugar has been protected a century without national benefit and without progressing." The Farmers' National Congress, which met at Indianapolis last November, did not omit from its consideration of agricultural products domestic sugar production. In fact, the memorial drafted and agreed to for presentation to Congress discusses sugar and wool at considerable length. It asks for sufficient encouragement to develop the cane and beet sugar industries. I will not further allude to the sentiment of that great convention of agriculturists on the subject of domestic sugar, assuming that the memorial will be laid before Congress. Mr. Chairman and gentlemen of the committee, I thank you for your attention. PRICE TABLE FOR 1896, SUBMITTED BY MR. OXNARD. Gen. J. HALE SYPHER addressed the committee. He said: Mr. Chairman and gentlemen of the committee, I have given some attention to the matter, but I do not know that I could add very much to the interesting facts which have been presented to you. I am not a sugar planter. As has been suggested, the cost of refining has been reduced very greatly in the last half a dozen years. The result of my investigation as to the cost of refining sugar by what is known as the Sugar Trust is one-fourth of a cent per pound to the American Sugar Refining Company, and about three eighths of a cent to the Louisiana people. Mr. McMILLIN. What is that statement? I did not get it. General SYPHER. The cost of refining sugar by the Sugar Trust does not exceed one-quarter of a cent per pound; that is the result of my investigation. Mr. PAYNE. Does that include waste or not? General SYPHER. It includes everything. In Louisiana it would be. about three-eighths of a cent per pound. The methods in Louisiana, of course, are not as perfect as the trust has them. They have a large plant and new appliances for carrying on this industry. In Louisiana we have some large establishments which make the higher grades of sugar. I have endeavored to get you, at the request of a member of your committee, exactly what the cost was in Louisiana, but I have been unable. There is the firm of Foos & Barnett, the Caffery Refining Company, which has a large establishment, and Lewis S. Clark, but I have not been able to get it accurately; but I understand it is about three-eighths of a cent. Mr. PAYNE. Do they refine in connection with the production of the raw sugar? General SYPHER. Some of those establishments refine what they purchase from the plantations directly-that is, they work up cane directly off many of their neighbors into the same class of sugars. I do not think any of them buy raw sugar for the purpose of refining it in Louisiana; none of those establishments I have named do so. SUGAR REFINERS AND DISTRIBUTERS. STATEMENT OF MR. FRANCIS B. THURBER, OF NEW YORK, N. Y. WEDNESDAY, December 30, 1896. Mr. THURBER said: Mr. Chairman and gentlemen of the committee, I have endeavored to concentrate the matter I have to say, so as to take as little time as possible. I make this statement on behalf of the distributing and refining interests, and incidentally that of the consumer. I respectfully present to your honorable committee a few facts, some of which might not otherwise come to your attention. I do so as a believer in the principle of revenue with protection. The late Peter Cooper once said to me that "Nothing can be called cheap which leaves our own good raw materials unused, and our own labor and capital unemployed." And in this statement is epitomized the whole doctrine of protection. In the game of politics the issue is often obscured, but, if we can get at the real facts, appeals to prejudice fade away and justice is secured. There is no just reason why American sugar interests, whether engaged in production, refining, or distribution, should not be entitled to the same degree of protection as other industries. Some citizens define patriotism as what is good for our country. Some politicoeconomic students are so broad and catholic in their views as to desire to take in the whole world. Be this as it may, no other product reaches the consumer in this country with the same small margin of profit to manufacturer and distributer as sugar. Each of them have often operated at a positive loss, and the much-abused refiner operates on a margin of about one-third of a cent a pound profit, a smaller margin, considering the risks of the business, than any other branch of industry. And yet for some occult reason every person rendering these services to the community is criticised as no other laborer in the vineyard is criticised. As a distributer of sugar for many years, I have done so at less than the cost of the services rendered. When the organization of the industry aimed to give distributers a commission equivalent to the cost of the service rendered, a cry of combination and monopoly was set up which was calculated to coerce legislators and courts into favoring chaos instead of justice. At no time has there been a monopoly, and to-day there are four competing refining organizations with a fifth threatened. I would be the last to put a free press in fetters, but there is riot in journalism, as well as in physical force. Only what is reasonable will stand the crucible of the court of last resort, the court of ultimate public opinion, and it is to this court that we must all appeal. The wholesale price of granulated sugar in the United States has been as follows: To-day the consumers of France and Germany, the largest producers of sugar in the world, pay about 50 per cent more than those of the United States, but those countries protect their sugar industries with a bounty which enables them to dump their surplus on foreign markets at abnormally low prices, which have broken down the refining industry in freetrade England, and but for our barrier of protective duties they would do the same for both our producing and refining industries. A curious side light on the discussion of free trade and protection is that England, the great apostle of free trade, has protected her shipping under the guise of bounties for mail service until her shipping industry is strong enough to successfully compete with those of all the world. The American Sugar Refining Company, or the so-called "sugar trust," was organized in 1887. Before the consolidation many refineries were driven into bankruptcy or out of business, among them, in New York alone, being Messrs. R. L. & A. Stuart; Booth & Edgar; Williamson, Griffith & Co.; C. Durant & Co.; William Moller & Co.; Moller, Sierck & Henken; United States Refining Company; A. F. & J. H. Ockershausen & Co.; Burger, Hulburt & Livingston; Wintjen, Harms & Co.; Bradish, Johnson & Co.; Katterhorn, Hopke, Offerman & Co. Since that time, owing to the organization of the industry, consumers, distributors, and refiners have been benefited. Foreign producers and refiners may have been prejudiced, but no American interest has suffered. They have bought their raw material cheap, but they have not sold the manufactured product dear. They have pursued a live and let live policy in manufacture, distribution, and consumption. Representatives of special interests are now seeking to change the basis of duty and minimize the principle of protection, but divested of all illusions the question presented is whether the work of refining should be done abroad or in the United States. Specific duties in many lines have an honest basis for preference, but in such commodities as sugar, in which pound values may vary as much as 100 per cent, the principle is manifestly incongruous and impracticable. Raw sugar worth 2 cents a pound should not pay as much per pound as refined worth 4 cents per pound, and, while a schedule based on graduated saccharine strength, as defined by the polariscope, might approximate justice, it would not do so to an extent which would justify the disturbance of the present basis to which trade has already adjusted itself. After a great industry has adjusted itself to a system, it should not be lightly changed. The officers charged with the collection of the revenue on sugar will confirm my statement that the system they have established for ascertaining values under the present ad valorem basis assures a result in the collection of the revenue on sugar as satisfactory, if not more so, than any basis of specific duties depending upon the manipulation of the polariscope. The charges of fraud and undervaluations when the polariscope was the arbiter are still fresh in the public mind. The specific duty principle is not applicable to all commodities. It is like the principle of reciprocity which is subject to existing individual conditions. American capital invested in American plants and real estate, paying American taxes and employing American labor in the sugar industry, should be entitled to the same degree of protection as other American industries. I therefore trust that your honorable committee will carefully weigh the varying conditions as to products and not impose cast-iron conditions which will operate to the detriment of American products, capital, or labor. One feature should not be lost sight of: Any differential imposed upon the product of any country granting a bounty should only apply to the refined prod uct and not to the raw material required by our refineries. Mr. EVANS. In what particular line are you interested? Mr. THURBER. I have been a distributer of sugar all my life, and in making these remarks I have done so largely from a distributer's standpoint, but not with a knowledge of the refining interests particularly, but in connection with my work in the reorganization of the sugar industry. It has transferred the price-making power from European to American markets. Mr. EVANS. Do you represent in any sense the Havemeyer Company? Mr. THURBER. No, sir. Mr. EVANS. You have no connection with it? Mr. MCMILLIN. There have been various statements made-not here, but elsewhere, because I have heard them from time to time-in refer ence to the distribution of the area for the sale of sugar by the American Sugar Refining Company. Will you please state to the committee what methods they employ, whether by way of a direct commission, or rebate, or whether there is any agreement not to sell below a certain figure? Mr. THURBER. The distribution is at wholesale and is now practically on a commission basis. The sugars are consigned with the understanding that about three-sixteenths of a cent is paid to the wholesaler as his profit, and while the wholesaler may sell to anyone at a less price, unless he is an appointed agent, he can not get that threesixteenths commission. Mr. MCMILLIN. Do they require any undertaking on the part of the distributing agent that the sugar shall not be sold beneath a certain figure? Mr. THURBER. Yes, sir; based on freight rates. Mr. MCMILLIN. At the time the sale is made is a payment made, or is there a rebate from the list price? Mr. THURBER. Yes, sir. Mr. MCMILLIN. Do they give the rebate from this price at which the goods are charged to them when sold? Mr. THURBER. Yes, sir. Mr. MCMILLIN. Do those who deal in their goods make a statement to them, before they can get this rebate, that they have not violated their undertaking not to sell beneath the list rate? Mr. THURBER. Yes, sir; they have to so certify. Mr. MCMILLIN. Without that certification they do not get paid for handling the goods? Mr. THURBER. No, sir. Mr. MCMILLIN. Suppose that a man who handles their goods proposes to sell to another party; is that party required to keep the undertaking, too? Mr. THURBER. No. sir. Mr. MCMILLIN. If the wholesaler sells to a retail dealer the retail dealer can sell to whom he pleases? Mr. THURBER. Yes, sir. Mr. MCMILLIN. But all their own agents are put under contract? Mr. THURBER. Yes, sir. Mr. MCMILLIN. You have been asked about the bounty paid on German sugars. I ask you, for information, do they give the bounty on both the raw and the refined when exported? Mr. THURBER. I do not understand that question well enough to answer intelligently upon it. |