Ai'RiL 1, 1914. 



THE INDIA RUBBER WORLD 



341 



The Rubber Crisis in Brazil. 



The true condition of affairs on the Aniacon, particularly in its relation to the rubber industry, luis been difficult to arrive at. 

 Cables from Para and Manaos told of failures, of rioting, of chaos. Calamity howlers predicted prompt annihilation of all 

 business. The facts are told in the following pages by a member of the Editorial Staff of The India Rubber World now in Para. 



The aviado and scringueiro agree on a price for the rubber. 



IN spite of newspaper talk of revolution and riot the city of 

 Para is as safe and as quiet as ever it has been. Business 

 troubles? Yes! lots of them! Failures? Scores and 

 scores ; but business goes right on, and the end of the rubber 

 business is not in sight. 



In order that the present situaticm in the .Amazon X'alley may 

 be understood, it is necessary to review the causes which have 

 led up to it. It might be expressed in one phrase— unhmitcd 

 credit to irresponsible parties, a condition that is no more. Kt- 

 trenchment is universal. Brazil has her nose to the grindstnne 

 and the operation is proving to be her salvation. 



OI.D CONUITIOKS. BEFORE THE CK.ASII. 



The trouble started years ago, when the .Amazon was tlie 

 only real source of the world's supply of rubber. It was nnt a 

 question of how the rubber was taken out, or whether the 

 financial plan was a sound one or not. It was only necessary 

 to get rubber to the market, and the high prices, natural "i 

 artificial, took care of the rest. Ther* seemed to be only om 

 way and that was for the aviador to extend credit to the aviado 

 and the aviado to the seringueiro. As long as these three factor- 

 working together secured the rubber all was well. Even if 

 the price was low, and did not balance the various inde1)ted- 

 ness charged against it, the annual credit for goods was issued 

 and paper profit swelled on the books of both aviador and aviado. 



Be it remembered that the scringoes, or ruliber districts, are 

 owned by men who live in Para or Manaos and rent them out. 

 The owner usually has a wholesale supply house in Para or 

 Manaos and is called an "aviador." The man who rents the 

 seringal is called an "aviado." He is trusted by tlie aviador 

 with thousands of dollars worth of goods in a season. The 

 basis of this transaction is the expectation that the aviado will 

 pay in rubber. The avaido, who is in charge of the seringal. 

 trusts the scringiiciros with supplies and sends them off to gather 



Sometimes the latter has a balance coming to him, but he usually 

 is in debt, and heavily, to the aviado. This makes no differ- 

 ence, however, and he always returns to his barracao with more 

 supplies, to be paid for in rubber. 



Seringal ox the Jurua River. 



with the aviador who receives the rubber sent 

 by the aviado. The account is credited with 



Admixistratiox Bfii.nixG o.x Mojr Pi.axtatiu.\, SiAit of Paka 



rubber. From the moment they disappear in the forest all con- 

 trol over them is lost. They are ab.solutely without restraint 

 or responsibility. Yet it is remarkable that as a rule they 

 prove trustworthy and return to the aviado with the rubber. 



It is the same 

 down the river 



the full value of the rubber as the aviador does not make money 

 on the rubber thus received but on the goods which he ships 

 back to the aviado. 



In the .'\cre district many of the owners of seringaes are also 

 storekeepers or aviados. Some of them own and operate steam- 

 ers which carry the rubber to Para or Manaos and return laden 

 with goods. They sell goods to other aviados on credit and 



accept rubber m payment. These 

 seringal owners are potentates liv- 

 ing in far away places, surrounded 

 by ignorant natives, and for the 

 most part uneducated ; so it is 

 little wonder that they have often 

 been harsh and cruel in dealing 

 with the seringueiro. At home 

 they were all powerful, dispensed 

 favors and goods on credit with 

 a lavish hand. These men, if sold 

 out, could not produce a cent of 

 actual money ; yet they were trusted 

 liy some aviador in Para or Manaos 

 for hundreds of thousands of 

 dollars. 



As long as Brazil's supremacy 



as a world's rubber producer was 



unchallenged there was not a cloud 



in the sky. If the market was low 



and rubber sold below cost, it did 



not matter for the books showed 



a large profit on the goods supplied. 



But the day of accounting finally 



came, and the unsoundness of the system became apparent. The 



creditors of the aviados demanded real money and refused to 



ship more goods. The price of rubber remained low and credit 



men were frightened. The aviadors' assets proved to be large 



