Industrial and commercial South America

Agriculture

The Agricultural Zone, according to late statistics, covers the greater part of that section of the Republic which lies between the sea and the Orinoco Plains: about 100,000 square miles, only one third of which is tilled. The section has great fertility of soil, and with its varying elevation and climate it is adapted to the production of everything needful for man or beast. Twenty per cent of the population is employed in agricultural pursuits. With the introduction of new methods and modern machinery a vast development and great wealth should ensue. At present the chief products are coffee, cacao, and sugar, with tobacco, cotton, corn, wheat, vanilla, etc., and a great variety of fruits and vegetables.

Coffee, as in Colombia, is called a product of the temperate clime, growing at an altitude of 1500-6500 feet but best at 3000. A tree is said to live 50 years and to produce a quarter to a half a pound annually. About $16,000,000 are invested in the industry; there are approximately 260,000,000 trees. Venezuela claims to be second in coffee production, exporting over 100,000,000 pounds in 1919.

Cacao needs a warmer climate than coffee, and moist air; hence it grows well on slopes near the sea having a temperature of 80°. But it is found and cultivated in other parts, growing wild in Guayana and near the upper Orinoco. Where cultivated, 80 trees to the acre are approved, of course at first shaded. After five years two crops a year, in June and December, are expected. Trees average a life of 40 years, with an annual production of 220-250 pounds an acre. About 16 seeds are enclosed in a long red and yellow pod, which turns purple when ripe. After being gathered, they are heaped in piles on the ground, left a few days to ferment and burst, when the seeds are shelled, washed, and housed. There are two grades here, the criollo or native, of very high grade, growing in valleys near the sea, and the trinitario, imported from Trinidad. The Chuao Plantation is said to produce cacao of a particularly sweet and fine quality, which is generally exported to France. Over $12,000,000 are invested in the business. In production Venezuela is third. There are more than 5000 plantations.

Sugar. The sugar industry is rapidly developing. New mills with modern machinery have been erected and more acres are planted. A mill at Maracay can crush nearly 1800 tons of cane daily, with an output of sugar of 80 tons. Four species of cane are cultivated, the indigenous, the criolla, most largely, as being sweeter and otherwise giving good results. The reaping is arranged so that the grinding may be constant throughout the year. The canes near Lake Valencia are longer and thicker, with more juice but less sweetness. The best quality of sugar is produced near Guatire, three hours by motor from Caracas; the largest quantity on two plantations near Lake Maracaibo, each having a daily output of 800 tons.

There are four varieties of products: sugar, brown sugar, alcohol, and rum, all of which many large plantations are equipped to produce. Of the two near Bobures, Zulia, one has 5000 acres under cultivation, the other nearly as much. The total capital invested is above $10,000,000. An increasing foreign market is expected.

Tobacco is grown in many sections, thriving in humid fertile soil. It develops in six months, but requires great care. There is much variety in the quality, some being strong and heavy, some delicate with fine flavor and aroma. A little is exported to Havana and there mixed for making cigarettes. The annual production, above 3000 tons, might be increased.

Cotton grows wild in many parts of the country, and is cultivated in a number of States. The average crop is about 4,000,000 pounds of seeded cotton, half of which is raised in Aragua and Carabobo. Zulia produces the best cotton, with longer fibre, nearly one-fifth of the crop. Lara, Portuguesa, and the States of the East supply the rest. The cotton is sown in June or July and harvested in the dry season, December to March. It is freshly planted every year in connection with vegetables, the receipts from which cover the cost except for that of gathering; so that the industry furnishes a desirable opportunity for immigrants with small or no capital. About $200,000 are invested in cotton growing.

Coconuts are indigenous in Venezuela; and in the regions of Zulia, Carabobo, Bolívar, Barcelona, and Cumaná, there are broad plantations. Over $1,000,000 is invested.

Wheat is grown to some extent and fine crops are produced; but much more land is available in the high table-lands and valleys of Western Venezuela so that home consumption could easily be supplied. With improved methods, machinery, etc., it might even become a staple export.

Corn is cultivated everywhere in all kinds of soil from sea level up to 9000 feet, but it grows best between 1500 and 3000 feet. About 75,000 acres are devoted to its production; 150,000 tons are raised, some being exported. It is the real bread plant of the country especially in the interior.

Beans in large variety are produced, black beans being greatly in demand and some exported.

Indigo was once cultivated and in 1802 was exported to the value of $2,500,000, but its production was abandoned owing to higher returns from coffee.

Vanilla grows well in the rich lands of Falcón, Lara, Bolívar, Zamora, and Anzoátegui. Its cultivation might be developed.

Forestry

The forest resources are inexhaustible but hardly touched, the zone comprising about half of Venezuela of which 98 per cent is virgin territory. Nearly three-quarters of this area is public land, over 100,000 square miles. With more capital and labor, better means of transport, and modern implements and machinery a great development will result. The chief forest products are rubber, balatá, tonka beans, divi-divi, and various medicinal plants. There are many dyeing and tanning plants, and gums and resins abound. In the forests a great amount of timber exists including the finest varieties; but as usual these are scattered, and with present facilities, difficult to get out with a profit. Of the 600 species of wood 5-10 per cent are marketable. 145 varieties used for ornamental purposes and 20 kinds of woods and barks suitable for dyeing and tanning were exhibited at the Chicago Exposition in 1893. The great mora tree, three feet in diameter, is excellent for ship building; mahogany, rosewood, and other trees of hard wood abound.

Rubber, chiefly of the hevea variety, is found and exported both from the Casiquiare-Amazon section and more from Yuruary in East Bolívar. It is cultivated near Ocumare del Tuy, each tree there giving 460 grams of juice, 95 per cent pure rubber. Several million people are needed to exploit the industry, in which $1,200,000 has been invested.

Balatá, procured from forest trees in a manner similar to rubber, is allied to gutta percha, and is employed with this for many purposes.

Divi-divi, one of the best and cheapest plants for tannin, grows wild throughout the country, chiefly along the coast and on the edge of the llanos at the foot of the south slope of the Coast Mountains. Hot lowlands with a minimum average of rain suit it best. It grows to a height of 20-30 feet. The brown pods three inches long contain 30-40 per cent of tannin, sometimes even 50. The seeds have little. In wet weather the tannin is liable to sudden fermentation especially in electrical storms, when the tanning is impeded, and the leather may be stained. Some trees 90 years old still produce a full crop. Near Cumaná, a tree may yield 275 pounds a year, but in the west, 25-50 pounds only. It is an extremely cheap source of tannin though not largely used. Venezuela probably has more frequent stands of this tree than any other country. 5000 men are said to leave Ciudad Bolívar yearly for its collection in the interior. As cultivated in Curaçao plantations, the pods have 20 per cent more tannin and bring 25 per cent higher price.

The Mangrove bark is another important source of tannin; the tree growing in swampy ground is useful in reclaiming land at the ocean’s edge. The bark has 22-33 per cent tannin, the leaves nearly 20, the wood some. The stands are unlimited in number.

The Tonka Bean, a black almond with delicious perfume, is the fruit of the serrapia tree. The beans are used in the preparation of chewing tobacco and in making perfumes. The price varies from 50 cents to $5 a pound. This is a staple of great value in the Orinoco forests, but many gatherers die of fever or starve. A few concessions have been granted for the cultivation of tonka trees, in the public lands of the Caura district. In one year over $700,000 worth of the beans were exported.

Chicle, used to make chewing gum, comes from the sap of a tree called pendare which has a delicious fruit, sapodilla. The tree may be tapped continuously 8-15 years. The sap is boiled in the forest.

The Caoba or mahogany tree grows from sea level to about 3000 feet. It may be seen along the streets of Valencia. It grows to a height of 130 feet with a diameter of four feet at the base. It is exported to Europe and to the United States.

The Moriche Palm grows in clumps on the llanos. From the sap the Indians make wine, vinegar, oil, soap, starch; and from the leaves, hats, clothes, hammocks, baskets, mats, etc.

Fibre plants of superior quality exist in great variety and quantity. Among these are the cocuiza sisal called equal or superior to the sisal (hemp) of Yucatan; ramie, jipijapa, flax, and other varieties.

Plants for making paper grow in profusion, desirable for use rather than wood to save the destruction of forests. The most abundant and desirable is bamboo, but many other plants are serviceable including the residue from sugar cane. The by-product of three tons of sugar would be roughly two tons of fibre, worth about $120. Bitter cane and other rushes might be so used, either exported as pulp, or in some localities made into paper.

Cattle Industry

Goats have been spoken of as raised with great profit on the well adapted lands near Barquisimeto, comparatively high, and on lowlands in the regions of Coro and Maracaibo.

Cattle. The cattle industry has still greater possibilities. The pastoral zone extends from Barrancas to Colombia and from the Vichada River to the mountains in Carabobo. While a portion of the llanos like those in Colombia suffers from severe drought in the summer, and though in places the grass is thin, in this immense region there is room for an enormous number of cattle where the grasses are rich. Hence stock raising can be carried on to great advantage. There is some difficulty in transportation, but this is gradually improving, and with the erection of more packing and slaughter houses, and with improvements in breeding, the industry has a sure future. Some stock raisers, especially General Gomez, have made great efforts for improvement, importing full blooded cattle of different breeds to produce a better kind, perfectly adapted to the climate of Venezuela. Modern methods are being employed, and in the valley of Maracay a large number of live stock is fattened ready to supply the 500 cattle daily killed at Puerto Cabello by the Refrigerating Company which exports them. A new packing house is to be erected at Turiamo. It is reported that a contract has been made for 200,000 acres to be colonized by Germans, who wish to control the meat packing industry. The number of cattle in Venezuela is estimated at 3,000,000.

Sheep, horses, hogs are also raised in the valley of Maracay; acclimated specimens of special breeds have been obtained for reproduction in other parts of the country. At present horses and mules are raised in comparatively small numbers.

Mining

There is hardly a precious metal or valuable mineral which does not exist in Venezuela, though little has been done to exploit them. Gold, silver, copper, iron, lead, antimony, tin, quicksilver, asphalt, petroleum, coal, sulphur, asbestos, platinum, diamonds, and other precious stones are found; 25 years ago 226 deposits had been located: 62 gold, 29 coal, 14 copper, 10 iron, etc.

Gold, the most exported metal, while found in every State, has been chiefly sought and profitably worked in Guayana, where in the Yuruary region considerable mining has been done. True alluvial belts are found, zones of shale, and quartz veins. The alluvial deposits known are mainly near the British Guiana border in the Cuyuni and El Dorado districts. Placer gold exists along the Caroni River and in smaller tributaries of the Orinoco above Ciudad Bolívar. The rock formation shows the gold to be in stingers and crystalline grains of arsenical pyrite, from which the placers and pockets have been formed.

The quartz veins are more northerly near El Callao, where $50,000,000 are said to have been produced in thirty odd years. One mine in the Yuruari district has yielded 35,000 ounces. Metal is found in pockets 50-100 feet deep about 150 miles from the Orinoco. An English company has mining claims west of El Callao, where the ore is treated with quicksilver and cyanide, yielding 1-4 ounces per ton. Another company is working on the La Paz Bonanza, where 10,000 ounces were taken out by crude methods from rich veinlets and pockets almost at the surface. Several other companies are engaged, French and Venezuelan, one along the Cicapra River, a branch of the upper Yuruari. It is estimated that several million cubic yards with an average yield of $1.00 each are here available at a cost of 50 cents per yard. With better transportation and other facilities this section may come into the front rank of gold mining districts in South America. At present it is said to be better adapted to individual operators than to large companies. The climate is not unhealthful if suitable precautions are taken. The country is well wooded except near Callao. The average yearly production of gold is 900,000 grams.

Copper is known to exist in several States: Falcón, Carabobo, Mérida, Lara, a rich deposit in the northern part of Cojedes; but the only one vigorously and very profitably operated is that of Aroa in Yaracuy, where dividends have been 75-350 per cent. Near Nirgua in the same State other copper mines have been worked.

Coal is found in various sections. Where outcroppings occur in Táchira, Mérida, and Trujillo small operations have been carried on. There are other deposits but the principal mines worked are in Sucre and Falcón. Naricual, 16 miles from Barcelona, has produced the most coal, but not of a very good quality. It is used on local steamers and railways, and some, with pitch from Trinidad, is made into briquettes. A little west, another mine with coal of better quality has been opened within five miles of tide water on the bank of a river. The mines of Falcón near Coro have been developed further and production is increasing. Coke ovens have been established. Coal is found in several places near Lake Maracaibo. In the deposit 60 miles northwest of Maracaibo the coal is of high grade, better than Middle West coal and equal to the Pocahontas; hard, bright, black, excellent for steaming. Some veins are 8-20 feet thick, and when the railway to Castilletes is completed the annual export is expected to reach 500,000 tons. Lignite, bituminous, and semi-anthracite varieties are found.

Iron ore deposits occur in the eastern hills or mountains south of the Delta, but in the Delta Territory at Imataca. It is 67 per cent pure and almost free from sulphur and phosphorus. In 1914 some Americans secured options. Iron is also found near Coro, Barinas, Barcelona, and Cumaná.

Salt is found on the island of Coche, on the peninsula of Araya near Cumaná, in the vicinity of Barcelona and of Maracaibo, and elsewhere.

Sulphur appears to exist in commercial quantities about 11 miles inland from Corúpano; and other minerals have been observed in various States.

Diamonds and Pearls. There are said to be diamond mines in the Orinoco region. Pearl fishing is carried on among the islands, about 1600 persons being so engaged. Rakes are now used as diving is prohibited. Recently $600,000 worth were exported within a few months.

Asphalt, found in the Bermudez Pitch Lake five miles from Guanoco in the State of Sucre, is an important source of wealth. This lake, the largest known deposit in the world (1100 acres), has more than ten times the area of the famous Trinidad Lake, though it is not so deep. It is regarded as the residue of evaporated petroleum, the asphalt here representing the outflow of 80,000,000 barrels of oil. The flow continues, the oil spreading over the lake and replenishing it. This with active seepages near indicates enormous oil bearing formations below.

The General Asphalt Company and its subsidiaries have a 30 year lease of nearly 12,000 acres including the lake. The structure of the lake includes faulting, folding, and fracturing of strata, with formations of black shale, sandstone, and fossiliferous limestone, the last supposed to be the source of the oil, and the sandstone its reservoir, whence from pressure of gas it escapes to the surface. A narrow gauge railway is in use. From lack of transport hardly 20,000 tons of asphalt were shipped from Bermudez Lake in 1920 compared with over 40,000 in 1919; from Trinidad Lake, about 70,000 in 1919 and over 108,000 in 1920. In the Bermudez concession is a large asphalt deposit 100-200 yards across, on the Island of Capure in the Orinoco Delta.

In the Maracaibo Basin are other beds. One near the Lake at Inciarte, 27 miles from navigable water, is 94 per cent pure; but transportation is difficult.

The Petroleum prospects of Venezuela are excellent. The chief work accomplished is in the Maracaibo Basin, which is regarded as one of petroleum as well as of water. Many companies are engaged in development work. After two years of preliminary examination by 35 experienced geologists, the Caribbean Petroleum Company selected 1000 areas averaging 1250 acres each for further investigation. Of these they now retain 250, covering 312,500 acres. With a lease concession for 30 years, a tax of eight cents an acre is paid annually and a royalty equal to about ten per cent on oil shipped from the country. On one section, the Mene Grande Field, ten miles east of Lake Maracaibo to which a road through swamps was built, about a dozen wells have been drilled, in all of which oil has been found. The first were capped, but with present facilities flow is permitted. The character of the oil improves with depth. Three 55,000-barrel steel tanks have been erected, and pumping stations on the field and at the port. A pipe line was laid 11 miles to the shore at San Lorenzo, where, 70 miles southeast of Maracaibo, storage tanks and a refinery were built. The latter, now in operation, will refine every grade of oil except lubricants. The capacity is 2000 barrels daily (42 gallons each). One well is said to rank in output with some of the Mexican. Much of the oil is now used by some Venezuelan railways, and by industries of the country. Part of the crude oil is carried by three barges and eight converted monitors of 450-500 tons each to a refinery at Curaçao, which has larger storage tanks, pumping station, etc. The refinery has been running 1000 tons of crude oil daily, but can take care of 4000 tons. The swift current of the Maracaibo Channel makes management of the monitors difficult. This Company has other wells at Perija, 50 miles west of the Lake. The first, which struck oil at 1227 feet, was shut in. One in the Limón Field, drilled to 2752 feet, was abandoned.

Other companies have concessions for work near the Lake, at the east, south, and southwest. One was hampered by wild Indians, compelling the employment of armed guards, another by extremely unhealthful conditions; but both after some unsuccessful work have found promising wells. The Colon Developing Company, with a large property 100 miles west of Encontrados and near the Colombian border, has struck oil at less than 1300 feet, close to the Rio de Oro. Two thousand barrels of high grade oil were produced within 24 hours, but as no facilities for transport existed the well was capped. This oil is said to be of quality superior to that east of the Lake, which is better than the Mexican.

East of the Lake, another field, north of the Mene Grande, is owned by the Venezuelan Oil Concessions. Wells drilled here have passed through three oil bearing sands; the deeper, the better and lighter the oil. One has spouted 80 feet high; another over the top of the derrick. An area of several square miles is proved. This Company has 3000 square miles of oil bearing land near the Lake for 50 years. In Mexico wells producing 100,000 barrels a day are seen. The general manager of this Company believes the Venezuelan wells will be bigger.

The Venezuelan Falcón Oil Syndicate, which has a 50 year concession of over 2000 square miles in Falcón, expects to open up many fields. Pipe lines could converge and refineries be installed within 50 miles of the farthest point. The first well drilled is 37 miles from the seaboard. Motor tractors are employed. The British Controlled Oilfields has taken over the Bolívar Concessions, which has the right to bore in 7,000,000 acres in Falcón.

On the Island of Trinidad 362,800 barrels of crude petroleum were produced in 1920. Near this Island, corresponding to the oil region at the northwest of Venezuela, is one at the northeast around the Gulf of Paria, especially at the south, and comprising the Orinoco Delta. Here is found the heavier form of petroleum in large quantities. Some wells have been drilled on the Peninsula of Paria with no good result. The Guanoco Field, south, is believed to cover the axis and flanks of the Guanoco anticlines, of which the southern is thought to be responsible for the great oil seepages of the Asphalt Lake. The field is believed to extend 60 miles southwest, to and beyond the San Juan River. The first well was drilled (1912) in the Lake. Heavy oil, specific gravity 1.02, was found under enormous gas pressure, making operations difficult. Production of 1000 barrels a day was secured at 615 feet, but the well was closed to avoid waste. Later it produced in three months 50,000 barrels. Other wells have been drilled in the vicinity, also on Pedernales Island in the Delta; the oil from the latter of lighter gravity. For some purposes the heavy oil is of special value. It is too heavy to pump, but the strong gas pressure makes it available. The areas are swampy, difficult to work, and unhealthful.

Manufactures

As might be expected, the manufacturing industries of Venezuela are few in number and rely in the main on a protective tariff for existence. The principal articles made are cotton goods, paper, glass, cement, cordage, soap, candles, shoes, alpargatas, leather goods, cigars, cigarettes, etc. The five cotton factories produce 80 per cent of the ordinary cloth consumed in the country. In Mérida are woolen and hat factories. In Caracas good furniture is made, macaroni, paper, etc. There is a paper factory also at Maracay. Ten miles from Caracas the waterfall of Naiguatá, over 3000 feet, makes available 30,000 horse power, of which 9000 is used.

Investments

Among the various opportunities for the investment of foreign capital, including all of the industries mentioned, the safest are agriculture and stock raising; perhaps also small factories. Land is so cheap that little capital is needed for the agriculturist unless engaging on a very large scale. Coffee, cacao, sugar cane, castor beans, and many other articles may be raised with profit. Factories large or small may be operated to advantage. Cumaná and Puerto Cabello are good places for canning tropical fruits. Oil may be extracted for edible or industrial purposes from coconuts, peanuts, and other fruits or vegetables. Chocolate may be made, cotton mills established. A mill is suggested for Margarita, where fine cotton is grown. Rope and bag factories might employ Venezuelan cocuiza or henequen to make the 2,000,000 bags needed annually in the country. Saw mills at Cumaná, Maracaibo, La Ceiba, Tucacas, etc., would be extremely useful.

Large capitalists may find opportunities for the construction of public utilities such as street railways, electric light and power plants, water works, sewers; also in bridge building, railway construction, etc. Some might be interested in mining, especially of iron, which is found favorably located for transportation within half a mile of a navigable river about 50 miles from the mouth of the Orinoco. To individuals with small capital the gold region would be more attractive. An important development of the large deposits of bauxite is attracting much attention.