XOVEMBER 1, 1915.; 



THE INDIA RUBBER WORLD 



93 



THE RUBBER SITUATION IN THE AMAZONS. 



By Our R,-giiUir Corrcsfondciit. 



I 'IIEKE lias been a genuine awakening here since my last let- 

 ter. Our people are beginning to see the real cause of their 

 troubles, and there is a serious movement under way to find a 

 remedy. We are actually starting to devise rational ways and 

 means for reorganizing the economical life of the country. 



Rubber was for many years the sole foundation of the econom- 

 ical edifice in this part of Brazil. We called it "black gold," and 

 it was almost as stable a standard as gold as long as we held 

 the monopoly of its production. But we have lost this monopoly. 

 We are no longer first among the world's producers of crude 

 rubber. Other countries now produce and sell more rubber than 

 we do. Our standard is depreciated ; the foundation of our eco- 

 nomical structure is gone and with it the structure itself. We 

 shall have to rebuild. 



When the present crisis was first felt, in 1913, we believed it 

 to be the same sort of experience we had passed through so 

 often before. But we were mistaken. The present crisis is not 

 like the others : it is deeper rooted. It is a crisis of transition, a 

 phenomenon of economical evolution. There is no use count- 

 ing, as heretofore, on some intervention of Providence : we must 

 act ourselves and waste no more time in vain hopes. To count 

 on the destruction of Eastern plantations by disease or plague, 

 as some have been disposed to do, is pure foily. No more relief 

 for us can be hoped from this source than from the war. When 

 the latter broke out and prices of crude rubber increased, many 

 of our people felt sure that old averages would again be at- 

 tained. Vou know how faulty this calculation has turned out 

 to be. 



We must reorganize and rebuild. Rubber is going to count in 

 the future prosperity of this part of the Union, but it will not 

 be all, as it w-as in the past. The greatest obstacle in our way 

 certainly is tradition — old habits. Our soil, of course, is perfect 

 lor the rapid and healthy development of rubber plantations. We 

 certainly can produce as good, if not better, rubber than other 

 countries, and we are nearer than they are to the consuming 

 markets. Our whole problem is the reduction of the cost of 

 production. The lack of labor, which has always been an ob- 

 stacle in the way of reducing the cost of our crude rubber, is 

 being remedied by extensive immigration, mostly from the south- 

 ern Brazilian states. The great factor in the cost of crude rub- 

 ber production now, as heretofore, is the expense of living, which 

 must be materially reduced. 



Here is where habit stands in our way. Our people are so 

 used to relying on foreign countries for their supply of the neces- 

 saries, of life that it is not easy to educate them to understand 

 that this system is the principal cause of their troubles. But the 

 people are beginning to pay more attention to the production of 

 the necessaries of life. Farming and stock-raising will decrease 

 the amount of our imports, and consequently they will lessen the 

 amount of money spent abroad. Cooperative associations for 

 production and consumption are being organized. Rural credit 

 will be developed and organized to facilitate the purchase of the 

 necessary implements for farming and for raising stock. 



Modern agricultural systems will be substituted for the primi- 

 tive methods now generally in vogue in this country. The work 

 of reorganization has started and it will be carried on actively, 

 though with care not to interfere more than necessary with pres- 

 ent business methods. 



Our forest wealth will continue to be exploited and at the 

 same time improved. Our people will be taught to recognize 

 the possibilities their land offers them. New means of com- 

 munication and new markets will be created, while those already 

 in existence will l)e modernized and improved. Private ship- 

 ping concerns will be encouraged, and we believe the best way 

 to do this is to see that they are supplied with freight to carry 

 the whole year round. When the economical transformation of 

 the .Xmazons shall be an accomplished fact, with the abmulant 



local production of the necessaries of life, and with increased 

 trading facilities, incidentally we certainly shall be able to com- 

 pete with the Orient, whose sole advantage lies in low cost of 

 production. The future of this country is not so black as many 

 are inclined to believe it to be. Our new economical edifice will 

 be built with rubber as part of its foundation, and not as the 

 whole foundation, as it was in the case of the old structure now 

 wrecked. 



There is a rumor here that the government intends to send a 

 national transport steamer, the "Sargento .Mbuciuerquc." to 

 Holland with a cargo of coffee, crude rubber and other pro<lucts. 



Statistics for the fiscal year 1914-1915 show that our exports 

 of crude rubber amounted to only 35,305 tons as compared with 

 39,115 tons exported during previous fiscal year — a decrease of 

 more than 9 per cent. 



AUTOMOBILE TIRES IN BRAZIL. 



Crude rubber is the second in importance of Brazil's ex- 

 ports, but there are no automobile tire factories in Brazil, 

 where, up to the present time, French, English, German, 

 Italian and Belgian tires have dominated the market. This 

 fact is principally due to the experience of European exporters 

 and the long credits they allow to reliable dealers in Brazil. 

 European tires are furnished in all styles and sizes to meet 

 the requirements of American as well as of European-made 

 cars, .'\merican tire manufacturers only supply about 3 per 

 cent, of all the tires used. 



The customs duty on automobile tires was S per cent, ad 

 valorem until March 31, 1915, when the new law for protect- 

 ing Brazilian rubber was put in force and an import duty of 

 50 per cent, ad valorem placed on all automobile tires not 

 made of fine Para. As is known, the customs officials were 

 unable to enforce this law owing to the difficulty of determin- 

 ing the origin of the rubber. New rulings have modified the 

 law so that now importers, on paying the old duty of 5 per 

 cent, ad valorem, sign a promise to pay the difference of 45 

 per cent, in the event the legislature should fail to repeal 

 the "fine Para" law. 



The Michelin Tire Co.. of France, whose tiros have quite a 

 vogue in Brazil, publishes normal price lists for all of its types 

 and sizes of tires, together with the extra charge imposed 

 by reason of the increase in Brazilian customs rates, and binds 

 itself to refund these surcharges to the purchaser in the event 

 the law is repealed. For instance, the Michelin price lists 

 show: 34 x 4-inch tire-casing, "Semelle" type (leather steel- 

 studded non-skid tread), normal price $40.75; supplementary 

 charge $14 — to be refunded should Congress repeal the "fine 

 Para" tarif? law. 



WILL AMAZONAS PERMIT "CUTTING" OUTSIDE THE STATE? 



Manaos ow^es her commercial supremacy to the old law 

 which prevents "cutting" rubber outside the boundaries of 

 the state. There has been a rumor of a recent discussion in 

 the State Congress of .'\mazonas concerning a change in this 

 time-honored decree. Should the law be changed permitting 

 rubber to be "cut" outside of Amazonas it will be a severe 

 blow to the rubber commerce of Manaos. "Cutting." it 

 might be added, is a collective term that denotes cutting, 

 grading, sorting, packing and shipping. 



EXPORT TAX ON RUBBER ADVAUCED BY THE STATE OF AMAZONAS. 



A law has been passed by the Congress of the State of 

 Amazonas, Brazil, raising the export duty on rubber from 15 

 per cent, to 18 per cent. This action was taken without the 

 slightest warning and caused consternation in the trade. 

 Many exporters had already bought several hundred tons of 

 rubber on the 15 per cent, basis and were faced with a loss 

 of 3 per cent. The Chamber of Commerce of Manaos has 

 protested to the Governor, who finally permitted shipments 

 to go forward at the 15 per cent, rate by the first .\mcrican and 

 European steamers sailing after the new tax was declared. 



