14 



vestment in the sugar industry of the Philippines quickly followed, 

 resulting in enlarging the plantations and adding to their number in 

 the Provinces of Pampanga, Batangas, and Tarlac, in Luzon, and later 

 in the Islands of Negros, Cebii, and Panay. 



The only Spanish records available showing the exports of sugar 

 do not date earlier than 1854, for which year the figures were 47,704 

 metric tons. Of this amount Negros contributed a trifle over 5,000 

 tons. Conditions for the cultivation of cane were found to be excep- 

 tionally favorable in that island and the production there increased more 

 rapidly than in any other section, jumping from 6^000 tons in 1855 

 to 30,000 in 1860 and 125,000 tons in 1893. There is a difference 

 among authorities as to the largest production of sugar in any given 

 year. Seiior Jose de Luzuriaga, in an article contributed to the Phil- 

 ippine Census of 1903 gives the crop of 1893 as 300,000 tons and says 

 that this was the largest crop ever harvested up to that time. 



Spanish customs records give exports for the year 1892 at 312,798 

 tons. It is probable, however, that the crops of two years enter into 

 these figures, for the reports of the Manila Chamber of Commerce, com- 

 piled by calendar years, credit the heaviest exports to 1893, for which 

 year they are given at 4,186,982 piculs, which is equal to 261,686 tons. 

 There can be no doubt that the year 1893 marked the highest point in 

 the production of sugar in the Philippines. 



Immediately following this period a number of causes combined to 

 check development, important among which was the panic and the break 

 in silver that occurred in is 



At that time Russell, Sturgis & Co., a commercial firm founded by 

 Americans with offices in Manila and Iloilo, had grown to be one of the 

 largest institutions of its kind engaged in business in the Orient. Their 

 branch at Iloilo was extensively interested in sugar and had been instru- 

 mental, to a considerable degree, in developing the industry in Panay 

 and Negros. It was their custom to make advances to planters for the 

 purchase of machinery and for planting and cultivating the crops, and 

 to take payment in sugar after harvesting. As they were heavy exporters 

 and this system enabled them to control a large proportion of the 

 crop it proved highly profitable, but at the same time made it necessary 

 for them to make very extensive use of their banking credit, as the 

 capital required from one season to another was naturally great. When 

 the panic came it found them with assets that were undoubtedly ample 

 and unquestionably good, but entirely lacking in that very essential 

 liquid quality which permits of ready conversion. Banking facilities 

 were then controlled by British institutions, which, on account of the 

 great stringency then prevailing in the money market, and the resultant 

 failure of the house of Baring Bros, in London, together with the 



