32 THE CUBA REVIEW 



Labor mid Supervision, covering operation in two shifts and including ofi&ce 



force, per day $158.00 



Capital Charges: 



(Based on plant costing $500,000 completely erected, ready to operate) 



Interest @ 10% $50,000 



Depreciation @ 5% 25,000 



Taxes and Insurance @ 3% 15,000 



Maintenance @ 1 % 5,000 



Per year $95,000 



Per day $316.67 



Total daily cost $903.67 



Total cost per gal. fuel produced 12 . 55c. 



As a basis for calculation of net earnings, let us take the plant cost, $500,000, 

 plus a working capital of $100,000, making a total of $600,000. Assume the product 

 to be sold f. 0. b. plant for 20 cents per gallon. This gives a net profit per gallon 

 of 7.45 cents. On one year's production the net revenue will be $160,920. This is 

 nearly 27 per cent, on the total investment assumed. 



Figures Conservatively Calculated 



This price of 20 cents per gallon is conservative. It allows the fuel to be retailed 

 at 35 cents in competition with gasoline, with a margin of 15 cents between factory 

 price and retail price to cover cost of distribution and profit to the distributors, and it 

 anticipates a possible cut in the price of gasoline where the present price is 50 cents. 

 It may be objected that molasses ought to be put in at 2 cents per gallon instead of 

 1 cent. Whoever proposes that, will have to show a present demand that will force 

 the price to that figure. But granted that it is worth 2 cents, the profit per pound is 

 reduced to 4.95 cents, the yearly revenue to $96,920, and the rate to a little more 

 than 16 per cent. 



In conclusion, it should be said that there has been no attempt in this article to 

 make out a case for this industry. The costs have not been underestimated, nor the 

 yield overstated. The writer has made what seems to him to be a reasonable statement 

 of the earnings to be realized. The cost of production, with everything provided for, 

 and molasses at pre-war value, will not go over 15 cents per gallon. The financial 

 expert is welcome to set up the case in any way that suits him; he will find that 

 it is entirely worth his attention. In the cost of plant, given at $500,000, everything 

 necessary has been included. Buildings, apparatus, power equipment, stills, yeast breeders, 

 tanks, etc., are all of the best quality. Stills of the kind included have been in 

 operation for 40 years. Tanks are good for 20 years at the very least, probably longer. . 

 Production of alcohol can be increased over the rate given by suitable refrigerating 

 apparatus applied to the fermenters, and the increased recovery will show a profit 

 over the additional cost. 



Return of Soil Constituents 



It has been stated in the introductory portion of this article that in the production 

 of alcohol from molasses, practically everything that comes out of the ground can be 

 returned to it. To the agriculturist this is important, because the productivity of the 

 soil is not impaired to any great extent and the importation of fertilizers is thereby 

 reduced. To make this clear, let us trace the cycle through. The soil is robbed of 

 certain constituents, which, together with the carbon, oxygen and hydrogen taken from 

 the air, are necessary to the growth of the cane. In the process of making raw sugar 

 only those elements that come from the air, and which make up the sugar, are shipped 

 away. The ash from the bagasse and the mud from the filter presses are returned 



