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EVENING BULLETIN, HONOLULU, T. IT., WEDNESDAY, DEC. 1G, 190.
WAY BEET SUGAR GROWERS
MUST HAVE PROTECTIVE TARIFF
SMITH OF MICHIGAN
His Interesting Statement
Of What Beet
SHARP QUESTIONS ARE PUT
BY COMMISSION MEMBERS
Matters of Traniportation Benefit
Now Given Under Tariff Elim
ination Would Mean Serious
Results for Farmers
During llio tariff hearing on the
mig.ir sclicilulo one of the witnesses
licnnl wub Carmen N. Smith of Mich
igan. Tho testimony of Mr". Smith,
Klven In full. Is an InterestliiB state
ment of tho position of the heet sugar
growers of tho ronntiy, and their need
lor tariff protection.
Tho chairman of the tariff commis
sion seemed to ho somewhat suspicious
of tho trust holdings In Mr. amlth a
company, he having put searching
questions to Mr. Hathaway, represent
ing heet sugar Interests, on whether
the stock In thlB Michigan corporation
were not hold In tho names of Mich
igan men as tiustees for tho Sugar
The hearing follows:
Mr. Smith; Mr Chairman nml gon
tlemen of tho committee, I represent
tho Ownsso Sugar Company, a Mlchl-
i;an corKirat!on operating two Biigar
factories In tho State of Michigan
ono nt the city of Owasso, with a capa
city of 1,200 tons of heets dally, and
ono nt tho city of Lansing, with a, ca
naclty of COO tons dally. Tho com
pany is capitalized for $1,250,000, but
has an actual Investment In tho Statu
of Michigan of over $2,000,000 in the
heet sugar business. Tho money was
invested almost entirely by Pittsburg
r.nd Philadelphia Individuals. We have
been engaged in tho sugar business
row for five ycnrB. I appear at this
hearing for tho purpose of expressing
tho conviction that It Is absolutely cs
M'titlnl to the success or continuance
of the beet sugar business In Michigan
at least so far as I nm acquainted
with It that tho present tariff rates
fihould nt least bo maintained as they
nro now: and I nm firmly convinced,
in order that tho business may bo par
Mentally prosperous or expand, that
there ought to bo nn additional duty
lcIod on sugar: but wo do not como
hero for the purpose of asking that,
nlthough I understand that In the
demand for a revision of tho tariff and
tho promise that the tail ft sliull be re
vised it Is entirely possible that this
revision might In somo Instances bring
mi increased rate of duty on
I tn a tf Ihn utlimtllln
JIVIilP w inu Dvnviimv.
I wUh to call the attention of tho
commltteo to ono fact. Tho Invest
ment which our company mado In the
biigar business was ono which vus
mado on tho Invitation and urgont ad
vlco of tho United States Government
through Its Department of Agricul
ture; and also It was based upon tho
recognized policy of tho administra
tion and tho party In power of protect
ing and encouraging domestic or homo
Industries. If It had not been for this
encouragement and for tho pledge
mado by the Republican party In Its
platform, and tho reliance that we hud
upon tho continuance of tho policy of
protection, I am certain that this par
tlcular Investment never would havo
been made. It Is an unfortunato fact
that ever slnco tho Investment wns
mado and we commenced doing liusl
ness ono or the most urgent demands
upon our tlmo and attention has beon
for tho resisting of efforts mado In
tho Congress of tho United States, not
with malice, but, as wo bellevo with
tho ceitaln result. If successful, of
hampeilng or destroying this Industry
It has boomed a little to us liko a
bicach of fulth, and If tho money had'60" nsl"-'il you. becauso I presume
gone to the. people who mado tho
loprt'suntntlons I should feci a little
as if wo had ground for an action for
obtaining money under fnlso pre
tenses. Dut that Is a little asldo from
tho subject-matter, The principal
thing I want to impress upon tills com
mltteo Is this, that nt least ns much
protection ns wo now havo Is nbso
lutely necessary In ordr to enablo tho
beet sugar companies to do business
mil simply to survive. Tho only way
in which that can bo demonstrated
nml It bcoms to mo It ought to cover
tho whole question Is this: What
does it cost tho nverago beet sugar
factory In tho United States to make
Its finished product? In tho caso of
our company, wo having been operat
ing for flvo years, I-cun suy thattho
flguicH presented hero by Mr. Hathn
way, from $3,75 to $4 per hundred, nro
Cost To Beet Men '
It has cost our company on an nver
age a little over $4 a hundred to make
Its finished product since we have
been In business. Of course In differ
ent years the cost varies according to
the abundance of supplies, the length
of tlmo we can run and the quality of
the beets, but the average Is a little
over $4 per hundred. The average
nelllng cost for the past five years was
glm by Mr. Hathaway as $4,35 a hun
dred. In somo cases the sugar fac
tories Imvo been able to sell In more
(.dvnntngcous markets than others,
Lut I think an nverago of $4.35 to $4.40
would practically represent tho net
return from what wo havo manufac
tured and the nverago that tho sugar
factory has manufactured. That leaves
a margin of profit which must pay all
tho interest and returns on tho Invest
ment, all the depreciation In the plant,
of. 40 cents a hundred pounds. Wo
have a maximum protection under tho
Dlngley tariff of $1 C8V4 per hundred.
Now , If you wish to encourage capi
tal to remain employed In this busi
ness, how much possible reduction on
the present Dlngley tariff could bo
made, unless j on wished to cut the
throat of this Industry, unless you
wished to drive It out of existence? 1
think It must bo perfectly evident to
every member of this committee and
to ovcry man who considers for ono
instant the question of protecting and
encouraging business in this country
that wo absolutely can not stand any
l eduction of the picseut turlff. Wo
havo already suffered from tho gen
erous way In which wo havo treated
Cuba. Wo havo submitted to a 25 per
cent reduction for our friends, tho
Philippines. We aro asked to do more.
I am not willing to tako second placo
to anyone In tho recognition or the
obligation wo owo to all theso prov
inces upon which we havo enforced
our guardianship, but I do not liellovo
that that all ought to bn paid by nny
ono industry. I believe we can be
generous after being Just, and I bo-
llevn that the possible development of
the beet sugar Industry In this country
to a point whero wo can furnish, to
gether (.with the cano growers of the
South, all tho sugar consumed here Is
worth tho serious attention -and-, the
honest consideration of Congress n't
every siago oi mis investigation.
I did not come Intending to gtvo any
statistics. I think tho danger gen
erally Is in theso investigations that
the commltteo is burled under statls'
tics and unable to get out; but I havo
Hated what I believe to bo tho real
question Involved, that If wo wish this
Industry to continue It must certainly
rot recclvo any unfavorable cousld
eratlon In determining tho tariff
Difference in Price
Mr. Underwood; What is the dif
ference In tho price of sugar In tho
zone In which you operate tho price
at which you sell sugar mid tho price
of Hamburg sugar with tho tariff and
tho freight transportation added?
Mr. Smith; We aro obliged to sell
sugar, Mr. Underwood, on tho basts of
tho Now York quotations made by tho
I cano refiners, less what has come to
uo recognized as tho differential bo
tween enne and beet sugar that Is 10
ocnts a hundred
That is tho recognlz
ed differential, it Is frequently less,
Sir. Underwood; Dut you can add
tho freight rato from Now York to
Mr. Smith; Truo; but wo ship
quite a largo portion of our product
to a point whero wo havo to pay as
much freight as or moro than wo add
from Now York. Dut tho illfTcrenco
Is at present on Hamburg sugar about
55 cents, I think.
Mr. .Underwood; Can you glvo mo
tho figures can you estimate It there?
I am asking for information. What is
tho prlco of Hamburg sugar In tho
zouo In which you operate, that Is tho
present Hamburg price, ocean freight,
domestic freight, and Insurance added,
which of course would ho tho selling
prlco hcic, with tho broker's comiuls
Mr. Smith; Our friends, tho refin
ers, havo been engaged In a little war
for which tho beet sugar people aro
paying tho expenses, largely, during
tne last row days, and I do not know
what tholr prlco on sugar Is Just now,
Mr. Underwood: That 1b the rea
that tho competition you aro meeting
it, irom me cano sugar Interests
Mr. Smith; Entirely.
Sir, Underwood; Who nro refining
law uuoan sugar; and I wanted to
tot ueroie the committee, ir I could,
what tho competition would bo from
Hamburg Biigar with the freight rato
Insurance, and broker's chnrges added,
lf "o competition did como that way,
which I recognize It does,
Mr. Smith: If tho competition did
not come from Cuba?
Mr. Underwood; Yes: If you had
competition from Hamburg, Bay today,
or whatever day at his tlmo you kuow
tho prlco, can you give tho committee
the Hamburg price of sugar, odd tho
ocean freight rato and tho Insurance,
and the domestic freight rato to tho
7nno In which ou hugely operate, nml
Ctvo us that?
Mr. Smith; Yes; I could do that it
I knew what the Hamburg price Is to
day. Perhaps somo of these sugar
gentlemen can glvo it to mo. What Is
It, Mr. Wlllott?
Mr. Wlllott: $4.40 a hundred, do
llvered In Now York.
Mr. Smith; $4.40. That Includes
the ocean freight then, ot course
Mr. Underwood; Ib that being sold
In New York now. the Hamburg
Mr. Smith; I think there has been
no sugar shipped from Hamburg for
Mr. Wlllett: No Imports, but tho
quotations nre mado every day, and
the quotation today Is $4.40 In Now
Mr. Underwood; What is the
freight from New York, per hundred
J omuls, to the zone in which you
Mr. Smith; Wo cover all tho terri
tory rrom Chicago to PlttBbnrg and
Duffalo. That juries from 16 to 20
cents a hundred.
Mr. Underwood; Tho freight from
Mr. Smith; Yes. Blr.
Mr. Underwood; Then that would
make It somewhere between $4.56 anil
Mr. Smith; Yes, sir.
Mr. Underwood; That Is Hamburg
sugar. Now, what are you selling
jour sugar nt In that terrltoiy?
Mr. Smith; Wo nro not selling It.
Wo aro waiting until tlieso refiners
got through their fight.
Mr. Underwood: Deforo tho fight
enme on, what were you selling It at?
Mr. Smith; We were selling It on
a basis of $4.70, Now York, which
would bo $4.86, say, delivered, New
Mr. Underwood; $4.70 In New
Mr. Smith: That Is, cano ynugar.
That would be $4.80, cano sugar, $4.70
Mr. Underwood; Dut that Is tho
New York price?
Mr. Smith; That Is all based 911
the 'New York prlco with tho freight
p.dded. 80 when I say $4.70, Now
York, I mean at a Michigan point
bearing a 16 cent rate, wo would add
that to tho $4.70 rate In Now, York
and' tho price In Detroit, which has a
1CV4 cent-freight rate, on tho $4.70
New York basis, would be $4.86.
Mr. Underwood; You would be sell'
lng the sugar at $4 8C4 In Detroit.
Mr. Smith; Yes, sir.
Mr, Underwood: And in Detroit
what would be tho price of Hamburg
sugar at $4.40, New York.
Mr. Smith; At $4.40, with the
freight rato added. It would bo $4,561$.
Mr. Underwood; It would be $4.56,
New York; the Hamburg sugar would?
Mr. Smith; On today's, yes, sir.
Dut If wo wore obliged to bell today
we would havo to meet that price.
Mr. Underwood; I understand.
Thoro is a dlRcrenco ot 32 cents to
tho advantngo of Hamburg sugar. You
stated that there Is no Importation of
German sugar into thlscountry, I be
lieve. Mr. Smith; When I gave you an
lllustratluu of tho market prlco fu
Detroit I was referring to the market
us It was thirty days ago, before this
lunacy broke out In Now York. To
day wo would bo obliged to sell at
what Is the New York market today?
Mr. Wlllott; $4.55 net, today.
Mr. Smith; Wo would bo obliged
to soil for 4.6114 then, in Detroit, as
compared with this $4.50H, which has
been given as tho basts ot Hamburg
sugar. It would bo only 5 cents dif
Mr, Underwood; Tho ndvantage you
havo by reason of your location would
then amount to 4V4 cents a hundred?
Mr. Wlllett; May I explain that tho
Herman granulated sugar which IS
(quoted from day to day Is what ta call
ed first class, which Is not suitable for
consumption In tho United States. Tho
valuo Is about 25 cents a hundred less
than tho valuo of cano sugar, and 15
cents a hundred less than that ot boot
'llio cnairman; I will ask you a
question or two. I understood you to'
say that In tho last threo years you
bad gotten about $4,36 for your pro'
Mr. Smith; Yes; somowhero bo
twceji $4.35 and $4.40.
Tho Chairman; That was 40 per
cent, or thereabouts, below tho prlco
of tho cane sugar sold In the saniu
Mr. Smith: No; the nverago has
not bean more than 15 eenta less
than the cane sugar.
Tho Chairman: Fifteen cents less?
Mr. Smith: Fifteen cents n hun
dred. Tho recognized differential Is
10 cents. M(
Tho Chnlrman: During the period
spoken of by Mr. Hathaway when
the Hamburg price averaged 2 cents
Mr. Smith: Yes, sir.
The Chairman? That Is all I want
to ask, I can not make those figures
agree some way,
Mr. Clark: It hns been stated on
the authority of the chemist of tho
Agricultural Department that nobody
ran tell tilts beet sugar from the
cane sugar. It that Is so, why do
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Quality unexcelled anywhere. Bought by
,6ur representative in China at first hand
' and not duplicated.
Fancy Silk and Grass Linen. Table Covers,
Center Pieces, Doilies. Exclusive designs
in Shirtwaist Patterns and Suits.
Silk Embroidered Fans, Silk Hand Em
broidered Ladies Slippers. Pongee Silk
Shirts and Pajamas for men. American
Importations of Men's Neckwear and Fine
YEE CHAN & CO
j 011 have to sell It at' a lower prlco?
Mr. Smith: The difficulty Mr.
Clark, In Introducing any new prod
uct In competition with a 'standard,
recognized product has always been
net in the first Instance by a lower
price. I believe that beet sugar U
absolutely chemically Identical with
Mr. Clark: I know: and that Is ex
actly what puzzles mo about It.
Mr. Smith: At tho samo time,
when they first commenced to mar
ket beet sugar in this country there
was a prejudice against It, which
was fostered by the dealers In cano
sugar. The dealers in beet sugar
were advised that beet sugar was In
ferior In quality and was not as sal
able, and a prejudice was created
against it which wus even fostered at
that time by the cane sugar redacts
refusing to furnish tho grocers with
their sugar if they handled beet su
gar. For some time that Bort of a
war was made against the beet sugai
Industry, and in order to induoo deal
ers to handle beet sugar It was neces
sary to sell it at a lower price; and
having started Into do that.-Jt'ls next
Impossible to ever recover und get
back on the same basis.
Mr. Clark: Do you suppose that
one houBowlfo out of a thousand In
the United States ever Inquires of the
groceryman when she wants refined
sugar whether It Is beet sugar or cane
Mr, Smith: I should say not.
Mr. Clark: If that Is the 'case, tho
fellow that buys the beet sugar and
sells It, the groceryman, Is doing a
better business and a wiser business
for himself than the fellow who buys
and sells the cane sugar? ,
Mr. Smith: Sure; he makes more
money on it. He sells It at the same
price as cane sugar.
Mr. Clark: And they have been
able to get up this prejudlco against
beet sugar and keep It up all there
years, and still keep it up?",
Mr. Smith: We have been unable
to get the prlco back. I do not know
why It Is. If you can suggest any
way, and put It Into this bill,' wo will
he clad to tako It In lieu of on In
crease In the tariff. The dealers re
fuse to handle It unless thoy get this
concession, I think with absolutely
no Bound reason for It. It Is a trade
condition w'hlch we have been unable
Mr. Dalzoll: You Justify tho suspl
clou by keeping your price down.
Mr. Smith: Wo would dp away
with that suspicion If we" were will
ing to hold our sugar and not sell ,11.
Mr. Longworth: Dut yoU-cannot
hold It. You must sell It within five
or six months?
Mr. Smith: I sny yml can not safe
ly store nny sugar for an unlimited
tlmo, whether cano or beet sugar. It
will absorb molstura and become, soft,
The Good Ship "Lurllne" brought us a fresh and complete assortment of
, ' " f . 1 In 1-2, 1, 2, and 3-lb. boxes.
BEISS fc BRADY'S GOODS
Consisting; of Exquisite Olives, Manranillo Olives, Stuffed Olives, Imported Smyrna Figs
in glau boxes, Stufftd Figs, Stuffed Dates, French Prunes, and Weisbadeu Stuffed Prunes m
Gordon & Dillwotth and Richardson & Bobbins' Plum Pudding.
Curtice Bros. "Blue Label" Sweet Pickled Fruits.
Christmas Trees for Deliver December 22nd.
' Special Attention given to packing-goods for Island Shipment.
or In some cases It will harden.
Mr. Calderhcad: Is It not also bo
canto It Is only In ono form, the
Mr. Smith: That Is true; It Is all
In one form.
Mr. Clark: If boot sugar and cano
sugar are identical, do not the wea
ther conditions affect cano sugar also,
when stored In a given place, as they
would beet sugar?
Mr. Smith: Certainly. I have seen
any quantity ot cane sugar that had
become absolutely hard und had to bo
ground over again und pulverized In
older to make It'salablc,
Mr. Clark: Your zone lies between
the top of the Koclty Mountains uud,
Mr. Smith: Wo havo not nny mar
ket nt the top ot tne Hocky Moun
tains, or nothing west ot the Missis
slppl Illvor that amouuts to nuy
Mr. Clark: You nre talking about
beet sugar tho wholu beet sugar
Mr. Smith: Yes.
Mr. Clark: Your mnrkct ranges
from the top of the Rocky Mountains
Levy fe Co.
STREET near Metropolitan Heat Co.
Mr. Smith: It conies, to 1'lttsburg.
Controlled in New York
Mr. Clark: Well, wy I'lttsburg.
The Chnlrman: Tho whole business
Is governed from Now York.
Mr. Clark: What whole business?
Tho Chairman: Tho whole busi
ness of beet sugar. f
Mr. Clnrk: Now, If theso men un
dertake to ship cane sugar Into your
district, they have to pay tho freight
latcs from New York tu Pittsburg
moro than jou pay, du thoy not?
'Mr. Smith: No; they pay halt a
cent less than wo pay,
Mr. Clark: You do not mean to say
that they can ship ugnr from New
York to Denver or Oinalui or St. Paul
cheaper than you can ship It from
Michigan, do you?
Mr. Smith: You havo moved our
question from PlttMmrg to Doiner
Mr. Clailt: No; I nm talking about
that tunltory, fiom Pittsburg to
Denver. Who hni tho cheaper
freight rates In that territory, the
heet sugar men or the cano sugar
Mr. Smith: The hoot sugar men. I
should sny; that Is, after you get
west of Detroit.
.Mr. Clark: You havo the advan
tage of. tho freight into?
Mr. Smith: After nu get west of
Mr. Clnrk: Yon have ns good kiigjr
us they have. got?
Mr. Smith: Yes.
Mr. Clark: Why do 5011 not dilvc
tlieso groci'iymeii into paying ou as
much for beet sugar lis they pay for
the cano sugar?
Mr. Siiilth: It has been luund not
only vxpcnslu hut il.iugeioiis to tiy
to coerce nnhody Into doing any
thing lu the Inst feiv jeum.
Mr. Claik: 1 knuws but ou said n
few inlmitea ngo that theso cjue bii
gar fellows cijeieeil jou a fw jcura
Mr. Smith: The) tiled tu.
Mr. Clark: They did cut ou down
Mr. Smith: That was beforo tho
public conscience was moused.
Mr, Clark: It Is not so very much
nroiiHcd yet, I nm afraid.
(Continued on Pace 10)