Panama to Patagonia

THE REGIONS AND THEIR RESOURCES

Topography a Key to Economic Resources—Coast, Sierra, and Montaña—Cotton in the Coast Zone—Piura’s High Quality—Lima and Pisco Product—Prices—Increase Probable—Sugar-Cane as a Staple—Probability of Growth—Rice as an Export and an Import—Irrigation Prospects—Mines in the Sierra—Geographical Distribution of the Deposits—Live-Stock on the High Plains—Rubber in the Forest Region—Iquitos on the Amazon a Smart Port—Government Regulations for the Gum Industry.

TO know the topography of Peru is to understand her economic outlook. The key to her industrial growth and to the mastering motives of her national policy is found in the knowledge of the three zones into which the country naturally divides itself. A lesson in physical geography is a study of the Peruvian aspect of the Panama Canal.

The zones are the Coast Region, relatively 1,500 miles in length, varying in width from 20 to 80 miles, and extending from the foot of the Coast Range to the Pacific; the Sierra, or Cordilleras of the Andes, including the vast table-lands, averaging 300 miles in breadth; and the misnamed Montaña, or mountain region, actually the land of tropical forest, and plains extending from the eastern slope of the Andes to the Amazon basins. The settlement of the boundary disputes with Ecuador, Colombia, Brazil, and Bolivia may reduce the 500,000 square miles of territory which Peru claims as her area, yet when the limits finally are fixed this trans-Andine region will still comprise more than one-half the total extent. Its wealth is in rubber and the varied products of tropical agriculture. The Sierra, in the future as in the past, is for the minerals, with alpaca wools and live-stock as an agricultural addition.

The Coast Zone is for tropical and temperate products. The principal ones are the vegetable family,—beans, potatoes; the cereals,—wheat, corn, oats; grapes and the generality of fruits; rice, tobacco, sugar, and cotton. Except in reference to two great world staples, they may be viewed almost solely in the light of domestic consumption. Sugar and cotton are on a different plane.

Peruvian cotton production cannot become large enough to affect the world’s markets, yet it may be a gain to the national wealth in the quantity which can be raised for export and also for the domestic spindles. The sands of Piura which stretch from the coast at Paita back to the Cordilleras have in them possibilities that are yet barely dreamed. The cotton tree of Piura amazes the beholder when he sees it in all stages of production,—in bud, in fleecy blossom, and in seed. The quality surprises the expert. It is finer than the finest Egyptian and is equal to certain grades of wool. It is known variously as vegetable wool and as wool cotton. Irrigation is employed to a limited extent. One ambitious scheme which was to bring 60,000 acres under cultivation was stopped for lack of capital. In the Chira valley between 90,000 and 100,000 acres will be utilized for production when a canal 56 miles long is completed, and the crop will be increased by 50,000 bales. An American company experimented on a project of watering the Piura lands by means of pumps to be driven by electric power from the river Quiros. The native field-labor in this region is reliable, and probably is as efficient as that of the negroes on a Mississippi plantation.

Cotton of good quality is raised in the central district of Lima and in the southern region of Pisco and Ica. While rains are not common in these districts, the fogs at certain seasons are heavy enough to be accounted rainfall, and the moisture in the air is precipitated in quantities sufficient for the product, taken with the somewhat restricted means of irrigating employed on the plantations. The cotton plant, no longer the cotton tree as in Piura, is met with for fifty miles north of Lima, and especially in the neighborhood of Ancon. The plantations lie under and between the overlapping sand-hills, side by side with fields of sugar-cane. Cotton is also grown from the north along the river Rimac to the lower slope of the Cordilleras.

Farther south from Pisco the region extends as far as the little port of Cerro de Azul, where an excellent quality is obtained. This is sent north to Panama for transport across the Isthmus and then to Liverpool instead of through the Straits of Magellan or around Cape Horn; but the cargoes will be larger when the Canal is opened and the expense of transshipment by railway across the Isthmus can be avoided. The cotton possibilities of the Pisco region are as yet in their infancy. They will begin to unfold when the projects for irrigating the great plain of Noco are put into effect.

Taken as a whole, the advantages of Peru as a cotton-producing country are a suitable climate, the alluvial soil of the valleys, the facilities for irrigating the sandy plains, and a sufficiency of fairly cheap labor. The price of the land is a fraction of the value of similar soil in Egypt. An official publication of the government places the yield per acre at 630 pounds, of which 250 pounds is lint cotton.

The Peruvian cotton is free from boll weevil. When that pest was ravaging the Texas plantations, a thorough inquiry was made by Minister Dudley under instructions from Washington, and the universal experience of the cotton-growers established that their fields never were visited by it.

Gins for baling the product are imported both from England and the United States. Encouragement has been given the manufacturing industry in Peru by the cotton production. Some of the factories have paid fair returns, though, as in the case of Mexico, capital went into mills somewhat heedlessly and in advance of the demand which could be created for the manufactured goods. Factories, making chiefly the cheaper calicoes, are in operation at Lima, Ica, and Arequipa, where the natives prove satisfactory mill-hands. Part of the manufactures find a market in Bolivia. The total exports of the manufactured goods for a given year were $110,000, while the imports for the same period reached $2,240,000. The exports of raw cotton in the present state of production are approximately $1,500,000 to $1,600,000 annually.

What is known as the hard cotton, rough, is produced in the Piura region, and in the dry years varies from 20,000 to 30,000 bales of 200 pounds. The moderate rough, chiefly from the Ica district, amounts to 40,000 bales. The hard cotton with some of the moderate rough goes to the United States, but the greater portion of the latter is shipped to Havre and Liverpool. The production of the Egyptian, or soft cotton, is about 80,000 bales per year. It is governed by the American price, usually with a premium of 1 to 2 cents per pound over New Orleans middling. The home factories consume 25,000 bales, the bulk of the balance going to Liverpool, though Barcelona obtains 6,000 bales and Genoa 2,000.

From these figures it will be seen that the Peruvian production is about 150,000 bales, or 30,000,000 pounds. An estimate by a leading authority of the increased production when idle lands are brought under cultivation by means of irrigation is 375,000 Peruvian bales (160,000 American), or 75,000,000 pounds. Other authorities double this estimate.

Peru has produced sugar for many years, and the industry has had the usual ups and downs, but it has capabilities of increase. About 125,000 acres were under cultivation in 1905, and 25,000 persons found employment on the plantations and in the mills. Both natives and Chinese coolies form the field hands. The production for export in recent years has varied from 100,000 to 125,000 tons, and it is gradually advancing to 200,000, reflecting the decrease of the beet-sugar crop in Europe and some enhancement of the price, though that is subject to the customary fluctuations. The average production may be placed at 140,000 tons, of which between 20,000 and 25,000 tons are consumed at home.

The raw sugar exported in the period from 1900 to 1905 inclusive ranged in value from $5,000,000 to $7,000,000 annually. The by-products, particularly the aguardiente, or cane rum, add substantially to the value of the staple. The alcohol, in addition to the local consumption, finds a profitable market in Bolivia.

The production of sugar-cane per acre in Peru is in the proportion of 56 quintals of sugar from 700 quintals of cane. The plantations are in the valleys of the streams which flow from the foot of the Coast Cordilleras to the ocean. Though the sugar industry is an old one and though partial irrigation is employed, it is doubtful if Peru’s present product is more than a fraction of what the soil can yield under universal irrigation. The cane-producing area is not confined to the coast. In the valley of Chanchamayo in the inter-Andine region are productive regions, and also in the valley of the Apurimac River in southern Peru. It may reasonably be said that within the next quarter of a century, provided the material development of the country goes forward without interruption, Peru will be producing 400,000 tons of sugar-cane, the major portion of which will be freighted through the Panama Canal to New Orleans or Brooklyn refineries at lower rates than can be had by shipments through the Straits of Magellan. Of the output some goes down the coast to Chile and some up the coast to San Francisco, a relatively small quantity around Cape Horn to Liverpool, and a large quantity across the Isthmus for transshipment to New York. The freight via the Straits is about 23 shillings per ton. The Canal is a positive factor in Peruvian sugar production.

Peru imports rice for her own consumption and exports it for foreign consumption. The great rice fields are in the north, in the Lambayeque valley, and from this district in one year 4,100 tons were exported. But much larger imports came from China. The industry is capable of development, yet chiefly with a view to local consumption. The normal expansion of this agricultural industry would appear to be in fully supplying the home demand and then in cultivation for the export trade.

Cotton, sugar, rice,—all call for an artificially watered soil. Irrigation is ancient in Peru. No new system for intensive cultivation and for ordinary crops can be expected to surpass the marvels secured by the Incas. Whether the ruins of the artificial waterworks be those still observed at Cuzco, the ancient seat of empire, or in the great passes of the Central Cordillera now traversed by the railway, or the old aqueduct at Chimbote, the wonder does not lessen. Can the moderns do as well as the ancients? They must do better. While they may not excel the Inca system of aqueducts and of packing water up the perpendicular slopes of the mountains, they may surpass them in inducing production in the arid plains. The topography and hydrography favor artesian wells in some sections and in others complete systems of irrigating ditches. The artesian wells may tap those lost rivers which, starting from the Cordilleras, dry up and reach the sea through subterranean channels. The arid tracts are fertile, probably due to the damp which is retained for a certain depth underground.

Peru has a very excellent irrigation law, the practical workings of which are satisfactory and from which good results have been obtained. The government has given wise attention to this subject.

The future growth of the Coast Region in wealth and population may be said to be largely one of irrigating ditches and artesian wells.[7]

The treasure beds of the Andes, as they have been exploited for centuries, are in the Sierra, though the output of the precious metals in the Coast Region has been great. The Department of Ancachs, which comes down to the sea, has enormous mineral wealth. The district lies within the two Andean chains which parallel the Pacific, and which are known as the White Cordillera and the Black Cordillera, the latter being nearer the coast. Raimondi, whose studies and surveys were the basis of much subsequent exploitation, estimated that this Department could supply for export 700,000 tons of minerals annually for an indefinite number of years. Silver, gold, and copper are the chief sources of mineral wealth. In the Cerro de Pasco district, since control was secured by the American syndicate, the copper output is more important than the silver production. Yet it is doubtful whether, notwithstanding the possibilities of the nobler metals, Peru has not more to hope from coal as a new industry during the next few years and especially during and after the Panama Canal construction period, than from gold and silver.

The petroleum deposits are in the north between Tumbez and Paita, around Talara, Zorritos, and Cape Blanco. Several of the English companies were not very successful, owing to bad management. The French company seemed to have the promise of better results. No contention is made that the oil is not there. In 1905 the output of the districts of Amotope and Tumbez was placed at 12,000,000 gallons. The supply which is now obtained is utilized as fuel on the railways and in many of the smelters. The value of the annual production is approximately $750,000.

Government data regarding mining often are tinctured with the enthusiasm of the private prospector, yet for guidance the distribution of the minerals as they are given in official publications may be quoted. I have not undertaken to present the complete statistics of production, not only because they are confusing and unsatisfactory, but also because local and temporary conditions destroyed their value as an index of the normal output.[8] An example of this was afforded by the practical suspension of silver and copper mining in the Cerro de Pasco properties of the American syndicate until the new railroad could be completed and the smelters built and put in operation. But for the prospector and the capitalist the preliminary information that is desired may be accepted in the form adopted by the government, that is, the geographical distribution of the minerals:

Gold—Paucartambo, La Mar, Union, Angaraes, Cajamarca, Otuzco, Luya, Huamachuco, Arequipa, Aymaraes, Huamalies, Carabaya, Sandia, Tayacaja, Ica, Huanuco.

Gold Washings—Marañon, Inambari, and nearly all the rivers that flow from the eastern side of the Andes.

Silver—Hualgayoc, Recuay, Yauli, Huancavelica, Pallasca, Pataz, Cailloma, Castrovirreyna, Cerro de Pasco.

Copper—Huaylas, Huaraz, Camana, Yauli, Cerro de Pasco, Ica.

Mercury-Cinnabar—Huancavelica, Chonta, Dos de Mayo, Puno.

Iron—Piura, Larez, Calca, Huaraz.

Sulphur—Tumbez, Paita, Chancay, Huaraz, Huarochiri, Cangallo, Arequipa, Camana, Moquegua, Tarata.

Coal—Huamalies, Dos de Mayo, Yauyos, Huarochiri, Canta, Tarma, Huaylas, Cerro de Pasco, Caylloma, Puno, Recuay.

Petroleum—Tumbez, Lambayeque, Piura, Puno.

Lead—Yauli, Huarochiri, Pallasca, Huari, Chilete (Ancachs).

The Peruvian mining-code and the corps of engineers which is maintained under it are of very great value. The annual tax on pertenencias, or mine claims, is 15 soles ($7.50), but in the administration of the law frequent complaint is made of the encouragement given to claim-jumpers. Unlike most other countries of South America, Peru lays no export tax on minerals except gold. The future of the mining industry depends so largely on cheapening and increasing the facilities of transportation, that it will be better understood in connection with the explanation of the Peruvian railway system and the plans of the government for further railroad development.

Live-stock or grazing may be said to be one of the industries of the Sierra, but in relation to the foreign commerce of the country it does not promise to be an appreciable source of national gain. Sheep-raising—alpacas, vicuñas—is of the high plains. With the increase in the population at these altitudes through mining settlements, the flocks are not likely to grow extensively. The vicuña, not being domesticated, is more apt to recede before the advance of civilization. Such growth as the live-stock industry may have in the Cordillera region may be looked upon chiefly as a means of supplying local consumption. The exports of hides and wool, while not necessarily stationary, do not indicate a heavy increase. The exports of hides are $750,000 per annum, and of wools, chiefly alpacas, $2,000,000.

The world does not yet fully grasp the possibilities and limitations of the Amazon rubber production, but the Peruvian government has a proper conception of it and has enacted legislation both to secure the development of the gum forests and to preserve them from heedless destruction. The rubber region within Peruvian territory has its main extension in the Department of Loreto and in the provinces of that interior country, but the area reaches almost to Cuzco and Lake Titicaca. All of it is within the Montaña, or forest region. In the Loreto district the population does not exceed 100,000 inhabitants, if it reaches that number. The productive forests lie along the banks of the rivers. The crude rubber that is of the best quality is known as jebe. The coarser article is called caucho. The jebe is obtained from the incisions made in the tree, while the caucho is the sap that is had from cutting down the tree which produces it and then extracting the milk. It is claimed also that the rubber tree can be sown and cultivated, but for many years, or until the supply grows scarcer, this effort is not likely to be made.

It is the aim of the authorities to prevent wanton waste and to preserve the trees. These are not allowed to be cut down. Two forms of contract are adopted. Under the first form the government leases to the grantees a certain number of acres for the term of ten years on condition of receiving a royalty approximately of 1 cent per pound in addition to the export duty. Under the second form it leases the rubber walks (estradas) of groups of 150 trees at an annual rate of about 10 cents plus another 10 cents for each 2½ acres (1 hectare) on which they are situated. A decree was issued in 1900, in pursuance of the law passed two years previously, fixing the manner in which the estradas, or rubber groves, could be located. Land in the forest region can be bought outright, can be located under rental, or acquired under contract of colonization.

Iquitos is the centre of the rubber trade for Peru, and substantially all the product now goes out from it to the Atlantic coast under the name of Para rubber; but with the completion of the central highway or transcontinental railway much of the product unquestionably will come to the Pacific coast and pass through the Panama Canal. In 1858 Iquitos was founded by the Peruvian government as a strategic outpost. In 1885, the year in which the rubber exploitation began, it was an obscure settlement. In 1905 its population was 20,000, and it was agitating municipal sanitation, electric lighting, and inviting bids for sewers. It is the third port of Peru in point of its foreign commerce, which amounts to $3,575,000 to $4,000,000. The exports of rubber from Peru for the year 1904 were $2,142,000, and they passed almost entirely through Iquitos. Since a contraband commerce is carried on in order to escape the export tax, the full production in a stated year is not obtainable. The quantity exported ranges from 1,200 to 1,500 tons each year. The exports are divided about equally between Havre and Liverpool.

When Bolivia settled her controversy with Brazil over the Acre territory, she transferred a boundary dispute with Peru. The latter country and Brazil, after some threatening passages of diplomatic arms, agreed on a modus vivendi, and that the extent of rubber territory belonging to each Republic should be fixed by arbitration. This dispute did not relate so much to the territory contiguous to Iquitos as to the Yavari River frontier. This basin has an annual known production of 1,500 tons and a large contraband output. The southern districts as yet are in the initial stages of exploitation. The Inambari River basin, including the Marcapata valley, is an almost virgin field.

The Peruvian government, having adopted effective measures for the protection of the rubber forests from prodigal destruction, also has sought to aid the various private enterprises by supervising the supply of labor. This is a much more difficult problem. The native Indians and the cholos are hardly numerous enough to meet the needs of the industry in its present state, and both persuasion and compulsion are exerted in order to force them to work. Its ultimate solution and the full exploitation of the rubber wealth of Peru must rest on the colonization of the trans-Andine region, and a gradual transformation into tropical agriculture of the districts which are not rendered unfit for habitation and cultivation by the annual high-water overflows of the Amazon’s affluents. But for this river region, as for the other regions of Peru, there is no artificial aid which can compare with the Panama Canal.