MATURITY.

In the sixth or seventh year, the tree commences to bear, but the pods at this time are very small and scarcely repay the effort to gather them. In the tenth year, the tree reaches full maturity. It then produces on an average 1 pound of dry cocoa of good quality. There are many trees which produce more, especially those which are isolated, some of which have yielded at one picking as much as 7 or 8 pounds. In the province of Oro (Machala), 11⁄2 to 2 pounds per tree is the estimated yield. The tree is in bloom during the entire year, but most of the blossoms fall before fructification, which occurs twice a year, the time varying with the locality.

DESCRIPTION OF TREE, FLOWER, AND FRUIT.

The cacao tree grows to a height of 20 or 30 feet; its leaves are evergreen and lanceolated in form; the base of the main trunk attains a thickness of 8 to 10 inches; the bark is hard and of greenish coffee color. The blossom is very small, pinkish white, and waxlike in appearance. It grows directly out of the main trunk and branches. If it fructifies, the petals fall off, and from the stamens, in the course of from fifty to seventy days, an oblong pod is developed. This pod is of golden color, and contains some twenty to thirty-five grains of cacao, enveloped in a gummy liquid, which coagulates on exposure to air. The outer rind of this pod is dark or golden yellow in color and very hard, a sharp instrument being necessary to cut it open. Its size varies, according to the kind of cacao, from 8 to 15 inches long by from 2 to 6 inches thick. The outer rind is marked by longitudinal furrows, more or less pronounced, which indicate the interior arrangement of the seeds. Both the outer rind and the gummy contents of the pod are porous and blacken in color as soon as picked, and in Ecuador are of use only to fertilize the soil upon which they are cast.

The seed or bean of the cacao is about the size and shape of a large almond. It contains the active principles of theobromine, albumen, phosphates, fatty matter, and water. When dry, it is vitreous in appearance, covered by a skin more or less delicate, which is easily removed and which contains a distinct pellicle. The color varies from dark coffee to violet, the latter indicating an inferior grade.

HOW GATHERED.

As soon as the pods begin to ripen, they are removed with pruning knives, very sharp, and attached to the ends of long poles, which are lengthened by joints as often as required. As the twigs are. very tough, the blow with this instrument must be strong and well

aimed, and the laborers must be experienced on account of the particular skill that is required and the fatigue that attends handling heavy poles sometimes 30 feet long, with the face continually upturned.

Wherever they can be reached, the pods are cut off with a machete. Considerable cacao is lost by the carelessness of the laborer and his dislike to bother with the pods in the upper branches.

HOW PREPARED.

The pods are heaped in piles by one set of laborers, while another cuts them open and extracts the contents. A sharp pruning knife is used, and the seeds are often damaged through carelessness. For extracting the gummy substance and the seeds, an implement made of a beef rib is used.

The drying is done on open platforms made of split bamboo and palms, where the cacao is exposed to the sun during three or four days, and, in order that it may dry uniformly and well, laborers are employed to tread it out with bare feet. If not well dried, the bean is apt to ferment, and if excessively dried it shrinks and finally turns. black. The driers are provided with covers for protection against

rain.

Attempts have been made to introduce drying machinery (steam), but at present not one plantation in Ecuador uses it.

HOW MARKETED.

When dried in the primitive fashion stated, considerable pulp. yet adhering to the grain, the cacao is sacked and sent to Guayaquil to be sold in its natural state. Some merchants attempt to deceive the buyer by washing an inferior bean in achiote, which gives the skin the appearance of first-class cacao; but this practice is severely condemned by honest merchants and is seldom followed; nor is reddish earth used here, as it is elsewhere, for the purpose of preserving the grain from decomposition and of increasing its weight.

Reaching Guayaquil, the cacao is subjected to the cleaning process. Splinters, dirt, and defective beans are eliminated, and the adhering clusters of beans broken apart and dried several times. before shipment. During this process, the cacao loses 4 to 5 per cent in weight. The sacks for foreign shipment contain from 60 to 70 kilograms (132 to 154 pounds) net. The largest portion of the crop is bought in advance by Guayaquil merchants engaged in this business, who loan considerable sums of money during the year for current expenses of cacao estates. Large capital is necessary, and the number of merchants engaged in the business is limited. Formerly, 12 per cent interest and 2 to 5 per cent commission were

No. 229 5.

charged on advances; but now, owing to competition, commissions are no longer asked and interest has been reduced to 8 per cent to planters.

AVERAGE PRICE OF PRODUCT.

The table which follows gives prices for the last forty-two years in the Guayaquil market. The advance in price, it will be noted, has kept pace with the decline in silver; so after all the bean brought in 1898 about what it did in 1857. For years, the bulk of the crop was shipped abroad on consignment. Later, foreign buyers supplied their wants through orders executed by commission merchants. Now the business is done on "firm cable offers," and the price is controlled by quotations from the leading world markets. The local rates are posted on the blackboard in the chamber of commerce, and the daily fluctuations recorded thereon. Competition of other countries seems to have had no visible effect either on prices or business. Ecuador sets the pace, being the largest producer.

Until the gold basis was adopted, exchange, which varied with the rise or fall of silver, was an important and harassing factor in the business. Now the rate is uniform. The Ecuadorian condor of 10 sucres is of the exact metallic value of £1. One sucre is therefore worth 48.665 cents in American gold.

*Owing to the fluctuating value of the sucre, as mentioned above, its equivalent in United States currency is given only for the last three years. Its average valuation for 1896 was 49.3 cents; for 1897, 45 cents; for 1898, 42.2 cents. In 1874 the sucre was worth 96.5 cents.

COST OF CULTIVATION.

The cost of cultivation is small, not exceeding 6 to 7 sucres per 100 pounds, delivered in Guayaquil. This includes management, cleaning, weeding, harvesting, drying, transporting, and every possible contingency except interest on the capital invested.

The first planting of cacao on an estate is usually done by laborers experienced in the business, who agree with the proprietor of forest land to plant and bring to a state of bearing a fixed number of trees at 20 to 30 cents per tree, payment to be made as soon as the trees are delivered. The laborers clear the land, use the timber at will, plant all sorts of catch crops for their own benefit, and even use the cacao product up to the date the proprietor requires them to deliver the trees. Contracts usually provide that the trees shall be delivered in first-class condition. From the time of delivery, the proprietor has but to keep the estate in order, collect the harvest, and enjoy the profits.

The tax on cacao estates is 1 mill on the assessed valuation. Taxes on production are local, and vary from 30 to 50 cents per 100 pounds. All cacao arriving at the port of Guayaquil pays the municipality 8 cents per 100 pounds, 5 cents of which is for the support of the university of Guayaquil, San Vicente College.

The export duty on cacao is $1.69 per quintal.

The expenses of the producer includes freight, varying according to distance from 30 cents to $1 per quintal, and unsacking, 5 cents per quintal. The taxes on production are usually paid in Guayaquil for producer's account.

ESTIMATED PROFITS.

The profits of a plantation depend chiefly on the quality of the land, management, and nearness to market.

Taking as a fair average 1 pound per tree, which is a certain minimum, a hacienda of 100,000 trees will produce 1,000 quintals, worth at the present market price $22,500; the expenses (maximum) would be about $7,000; and the net result per year would be $15,000 or more-a profit of from 40 to 50 per cent per annum on the capital invested, which will continue for an indefinite period, cacao trees lasting for several generations.

The price of a hacienda is governed largely by the market price of cacao. At present, a first-class hacienda would be worth $1.20 to $1.50 per tree, or a hacienda of 100,000 trees $120,000 to $150,ooo silver. This price always includes uncultivated lands, improvements, and appurtenances of every kind, as well as the trees and the land they occupy; also, the assets in the shape of debts from peons and others, which generally reach 20 per cent of the total value. On the other hand, it is much cheaper for the investor to

buy a piece of new land and establish a plantation by the means above described. This would involve an expenditure of scarcely one-fourth of what would be required to purchase an already established hacienda; and it is thus that the largest fortunes in cacao planting have been made.

With $10,000 invested in buying land and making advances to sembradores, as the cacao planters are called, it is possible to plant 40,000 to 50,000 trees, which, when bearing, represent a value of, say, $60,000 and pay 12 to 15 per cent annually on this value.

The mortgage banks lend amounts up to half the value of estates, appraising them at the rate of 1 sucre per tree in full bearing. These banks lend money on warrants, charging 9 per cent interest and 11⁄2 per cent commission annually, the proportion of amortization being in accordance with the length of the loan.

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The price of land varies greatly and depends on the caprice or need of the seller. Land adapted to cacao cultivation covers an area of some 19,600 square miles in the coast provinces of Ecuador. very small proportion of available land is now under cultivation, although there are large tracts adjoining important estates. In some provinces there are large tracts of Government lands suitable for cacao growing which are for sale at about $4 per hectare (2.4 acres), while private properties cost something like $15 a hectare.

The title to lands in Ecuador gives much trouble, being involved and obscure where they are not derived from the Government. In colonial times, grants of land were made for a small consideration or none at all, and the grantee and his heirs have handed down these properties without dividing them, so that to-day the owners hold fractional undivided parts of these original grants. Furthermore, the description of the property is generally defective because rivers have changed their courses and ancient landmarks disappeared since the original grant, so that it is impossible to determine its limits with accuracy. By a law made some sixty years ago, it was decreed that every share should represent $50, and that a shareholder could cultivate the land that he chose. This is the condition of many haciendas to-day, and is the sole title that the occupant has to the land he claims to own. There is also another grave complication where grants have been made to so-called communities or indeterminate groups of persons, who, by virtue thereof, have the right to culti vate any portion of the grant and thus come to hold it in fee simple, after an uninterrupted occupation for thirty years. It is likely that the Congress of 1899 will enact laws remedying these difficulties.

PRICE AND CHARACTER OF LABOR.

An unskilled laborer in Ecuador receives from 80 cents to $1.20 silver per day; the "tumbadores" (laborers who cut the pods off