THE CUBA REVIEW 25 



September it became necessary to provide means to prepare for the 1921-1922 crop and 

 to complete the "Violeta" mill extension, which mill had been dismantled in pursuance 

 of the program to double its capacity. By reason of the large amounts of money the 

 corporation was borrowing it became exceedingly difficult to raise $10,000,000 required 

 in addition to the above loans. The amount was finally procured from a group of banks 

 by an arrangement under which, in order to make the transaction possible, directors of 

 your corporation participated to the extent of $2,000,000. This was done by a plan 

 under which holders of Cuba Cane Sugar Corporation 7 Per Cent 10-Year Convertible 

 Debentures were invited to subordinate their claims for the benefit of the new $10,000,000 

 loan. In consideration therefor the rate of interest on such subordinated bonds was 

 raised to 8 per cent from July 1, 1921, to their maturity. Under this arrangement 

 $17,541,600 debentures, an amount satisfactory to the bankers, have been deposited and 

 duly stamped as assenting to the plan. The status of 7 per cent non-assenting debentures 

 is left unchanged, the subordination of the assenting debentures being exclusively for the 

 benefit of the new loan. Of this new $10,000,000 but $5,000,000 had been availed of up 

 to January 5, 1922. 



The company has passed through what is probably the most trying period to which 

 the sugar business has ever been subjected, and it has required the unremitting attention 

 and watchfulness of the officers and directors to meet, so far as possible, the changing 

 conditions. The situation has been one involving great care and anxiety to them. On 

 the other hand, the same conditions have made possible the institution of economies and 

 a closer control of operations than was possible during the unsettlement incident to high 

 prices and boom times. 



Owing to the prevailing conditions above outlined it became necessary to suspend 

 payment of the preferred dividend — the quarterly payment due on July 1 not having been 

 paid, and no dividends have been paid on the preferred stock since. 



The unprecedented and calamitous decline in the price of sugar and the demoralized 

 banking and commercial conditions in the Island were seriously aggravated and were 

 rendered all but ruinous by the increase in the duty on Cuban sugar entering the United 

 States, imposed by the U. S. Emergency Tariff Act, which raised that duty from $1 per 

 100 pounds to $1.60. Under the conditions of overabundant supply that existed, this 

 increase was necessarily absorbed by the Cuban producer, to whom it was a severe blow 

 at a moment of the greatest adversity. 



The total number of bags of sugar made by your corporation amounted to 3,978,102, 

 thus again showing a production of about one bag of sugar made by this corporation to 

 each ton made by the whole Island, our production being thus maintained at about 

 one-seventh of the total Cuban crop. 



The Cuban laborer has accepted the necessary readjustment of wages more readily 

 than might have been anticipated. There is no labor unrest in the Island either on the 

 plantations or the railroads. The wages of the Cuban laborer, although lower than in 

 1920, are still above pre-war rates. 



Most of the plantations of your corporation finished grinding during May and June; 

 "Moron," having started on January 3d, completed the crop on June 18th with 580,97Q 

 bags, the largest production made in Cuba within that length of time — there was another 

 Cuban plantation that made a larger crop, but it started to grind on January 16th and 

 ended on September 9th. 



There was no improvement in the sucrose content of the cane throughout the Island 

 as compared with the last five years. 



Cane Ground 



The following table gives comparison of cane ground at your mills during the last 



crop: 



Western estates 282,402,153 arrobas 3,151,810 tons 



Eastern estates 186,983,157 arrobas 2,086,866 tons 



Total 469,385,310 arrobas 5,238,676 tons 



The above figures show an increase of about 6 per cent over those of last year. 



