The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1918-09-13
new SUGARPRIDE
IS ADMISSION OF
MISTAKE IN PAST
Committee TacltIy Acknowledges
Price For Present Crop
Has Been Too Low
POORER PLANTATIONS 49,.
WILL BENEFIT MOST
Rich Plantations VIII Probably
Pay Eighty Percent Of
increase In Taxes

In the fixing Of I.2s cents q pound
as the price for raw sugar Of the next
crop there can be seen taeit admis-
sion that the price which was fixed
and maintained by the sugar committee
Of tho food administration for the pres
emit crop was too low. Producers have
criticised the committee for having &C.
complished only half of what 1t, was
DESIGNED for It now undertakes the
accomplishment of the other half. 40
= The committed sought to stabilize and
maintain at reasonable limit the price
Of refined sugar to the consumer In
this II succeeded. It was constituted
to maintain production to the highest
degree and in this 1t succeeded only 80
far as the patriotism Of the producers
helped. The price was too low to
stimulate production when other com
modities could be raised on which the
price. was not so drastieally controlled.
J Pisnters Pleased .a ....14y,
General satisfaction with the new SUI
gar price IS expressed by an connected
with the sugar industry in Hawaii, It
Is all that could be hoped for and more
than most expected. But 1928 cents Q
pound is not so high a price as IL
sounds. The old price Of sos with
higher costs for everything that enters
into the growing production and mark
citing Of sugar gave no larger margin
Of profit than did four to four and a
quarter cent sugar before, the war.
Costs are still mounting and will be
even higher next crop than this. Hence
an inerease of LES cents D pound for
raws win give a profit which is equiya-
lent to what was earned when costs
were lower and prices ranged from five
to five and q quarter cents a pound.
Sugar at 6,055 a pound means $l2Ll0
q ton at the refinery ports. At 7.2S
cents the price will be $145.60, an in.
crease of $24.50 a ton.
Poorer Helped Most
It is what may be called the poorer
plantations. or companies that will bene
ft most from the new sugar price.
With them it is a margin of profit in
stead of q margin of loss. 1t will en-
able them to earn up to the limit above
which profits are termed "war" or
Hexcess''. With the richer companies
it will mean larger earnings than this
year but not greatly increased divi.
dends.
Present indications are that the new
War Revenue Law will tax profits
which are in excess of the prewAr pro-
fits eighty percent flat. This will mean
that of the profits which are permitted
under the new price eighty percent will
20 to the government and only twenty
percent to the stockholders but this
win enable in many instances a pay
ment Of dividends during 1919 q fifth
larger than those that will have been
paid this year. 1t is this one fifth
margin that encourages the larger and
the richer plantations. 1t may be fur
their increased for it is based on the
same production as this year and, with
the exception of labor, every cOndi-
ton surrounding the industry is indi-
eatiVe of q considerably larger crop
than this year. As it is prOpOrtiOnate-
9 ly larger so can the richer companies
increase their dividends to the extent
of one fifth of the increased revenue
from the. larger optturn.
/ Somewhat Surprised
When the Planters Association was
advised last Monday that the figure
to be ANNOUNCED would be 7.28 it was
generally believed there was some mis-
take for it was figured that the per
centage of increase for the grower was
out of proportion to that allowed the
refiner. Stock market reports from
New York indicate that the investing
public there look on the division Of the
increase in the same light, had ex-
pected more and were disappointed, for
American Sugar Refining Company
stock declined sharply quickly on the
announcement, the decline having been
noted even before the announcement Of
the actual fixing Of the price. But by
granting far the longer end of the in
crease to the grower the committee has
made clear that its purpose Is to stimu-
late production to make larger the
profit where larger profit was neces-
safy. 49,:
Hard To Grant g. a..
To increase the price of refined sugar
two cents pound was not an easy
thing for the sugar committee to do and
IL hesitated long. The desire of the
food Administration on the mainland is
to hold prices to the consumer as low
as may be and vet keep production to
the maximum. This is shown in wheat
as well AZ in sugar. u, The increase Of
two cents a pound Affects 100000 900
people in the, United States alone. II
will mean about *l.5o added to the
cost Of, living of each one of these. On
the other hand. unless it we're 50 in.
eEeased these hundred million would
have 10 do without a considerable
part of what Is deemed their actual re-
auirements. Thus the committee had
a. difficult problem to solve and it is not
Z unlikely that 1t will be severely criti