The Washington herald., 1917-04-08

euenuOuSly applied. ThtS u the ever
famous yalorizstion OF coffee effected by
the Brazilian state Of Sac Paulo. The
second. which takes next place in COM
mereial Importance, Is the organization
Of the stsal planters Of Yucatan to avoid
Unnecessary loss both to themselves and
TO the consumers.
Both Of these great trade arrangements
set the world talking. and created a new
idea in business control. The latter in
stance Is just now very prominent In the
minds Of the American farmers and
cordaze manufacturers on account OF a
Vigorous attack by middlemen on the or
gsnization. the object Of which is to a
certain extent the elimination of the
same middleman.
Let us take a glance at the story OF
the valorization Of coffee IL the great
conee crop of Brazil of 1906-G had been
thrown upon the world markets 1t would
have had a result satisfactory to no one
IN the long run. II would have meant
the bankruptcy OF half the plantations of
Brazil with a corresponding effect upon
all conee-produclng countries. The world
was at that time drinking coffee made
from sixteen million. bags. Then came
the harvest OF Brazil, which alone
amounted to-in that extraordinary year
more than 2oO00.0Oo bags. apart from a
bigger offering than usual from Central
American, Columbia. Venezuela and other
conee-producing countries and a surplus
stock Of former Years in warehouses,
amounting to 100000 bags. The cost per
bag Of coffee production was then about
thirty-hve francs a bag. IL the years
products had been dumped upon the
world the price must have fallen as low
as at least twenty francs bag.
To remedy this disastrous stats Of af-
fairs. as everybody knows. the state
OF Sac Paulo bought up eight million
sacks OF coffee which were stored in
don, Havre, Trieste and New York and
reserved them from sale until a rea-
sonable price could be obtained.
Has any one ever complained of the
high price OF coffee in consequence Of
this action? On the contrary, coffee
Is one Of the most inexpensive OF drinks
ard there is no reason to suppose that
retail buyers were injured by the much
abused, passionately-defend valoriza-
ton plan The United States was the
only country which imagined that she
had a grievance and in cor sequence seiZ-
ed nine hundred thousand sacks OF this
coffee lying in warehouses in New York
End accused the storers of restraining g
trade, The matter was compromised by
the agreement of the marketers to sell
the coffee as speedily as possible, which
happens that the people who objected
10 the storing Of this coffee were not
the consumers. but the middlemen and
brokers' who feared a limitation OF their
profits
IL is now generally admitted. however.
that the action of the Brazilian authori-
ties in holding back a certain amount
Of their Oyer-product instead OF restrain
ing trade had in the long run a most
beneficial effect on the coffee trade con-
oitions. II was really not the high
handed action of a monopoly, but the
far-SiShted. clear business sense Of eX-
perts who knew what was for the best
interests of both producer and consum-
er. The profit-making. specializing. un-
Necessary middiemen were ruthlessly
shaken out and left to squirm and howl
Much the same story is now being en-
acted concerning the sisal product OF
Sucatan. Powerful interests in the
nited States are attempting to put the
responsibility for the present high price
of binder twine upon the Comision Regu-
ladOra del Mercado de Henequen-a CO.
operative selling commission composed
solely of the sisal farmers Of the state
Of Yucatan, Mexico. under the control of
the state government
I have undisputed proof that binder
twine made from Yucatan sisal should
he sold to the American farmers this
season at a price several cents per pound
below the price OF twine made from Ma
Mia hemp or any other fiber. 1t is true
that the price of sisaI fiber has increased
since December from 10 cents per
pound to 10 cents, the price at which
February and March shipments were ef-
fered. But the prices of all similar tibers
have increased in like proportion.
In 1916 YuCatan obtained. approximate
ly. siO,OOoO0O for her entire crop of sisaI
fiber. Every cent of that sum, with the
exception OF about Sl,OOOOOO, remained in
the United States. II represented the
purchases made by the Yucatan farmers
and merchants in this country. Yucatan
produces practically nothing but sisal
fiber and buys her food. clothing and 9TH
er necessaries of life in the American
markets, where prices of all commodities
have scared TO the highest levels ever at
tained. Thus the money that the Ameri-
can farmers paid, Indirectly, to the Yucca
tan farmers came back to them in the
shape OF payments for wheat, corn, -four,
cotton and woolen goods and the thous-
and and one other necessaries of life that
YuCatan Is compelled to buy in this coun-
try.
The Increase in the price OF all commo-
dities-sisal and other fibers included-is
due to the general condition Of the world
markets, and the law OF supply and de-
Ildnu sOle 1nefe-
fore. Il seems to me Illogical to blame
these Yucatan farmers for the increased
price OF their products. 1t simply went
up along with everything else. In discuss
ing this question with an official of the
henequen commission, he said:
'1n face OF the indisputable facts we
confidently anticipate that the keenly OBJ
servant, fair-minded American people will
easily discern that the attacks made upon
Yucatan's cooperative organization have
emanated from persons who were inspired
by purely selfish motives. Prior to the
organization and effective operation Of
the Comision Reguladora del Mercado de
Henequen certain middlemen were en-
abled to accumulate large fortunes in
consequence Of their control of the sisal
markets Yucatan's cooperative market
ing organization has effectualIy elimI-
mated spectators and middlemen OF every
sort from the sisal market. and naturally
the loss Of this source of revenue has
caused them to attempt to accomplish the
disruption Of the Comision Reguladora
and the reinstatement of themselves as
the daInlnant factors in the marketing Of
Yucatan's only agricultural product.
Before the days of the commission two
buyers who made deliveries to the two
principal American twine manufacturers
bought annually from 90 to 9S per cent of