SCHEDULE A.-BORAX.

THURSDAY, June 14, 1888.

STATEMENT OF J. W. MATHER,

Commission merchant, of San Francisco, Cal., representing the borax producers.

The CHAIRMAN. You have exhibited to us here refined borax, three specimens of concentrated borax, and four specimens of crude, including pandermite; where is that produced?

Mr. MATHER. That is produced near the Sea of Marmora. Panderma, from which it is named, is the shipping port on the Sea of Mar

mora.

Senator ALDRICH. Is that found in the condition in which you exhibit it here?

Mr. MATHER. It is.

The CHAIRMAN. And is that crude?

Mr. MATHER. That is borate of lime, or, as we call it in this country, cotton balls. That is found up in Nevada and California just in the condition you see these specimens here.

The CHAIRMAN. Is there much of it in Nevada?

Mr. MATHER. A great many thousand tons.

Senator ALDRICH. That is in the alkaline regions?

Mr. MATHER. Yes, sir; here is also another sample of borate of lime which we sometimes call crystalline. That is called colemanite, from the name of William T. Coleman.

Senator ALDRICH. You have to eliminate this lime from the borate of lime?

Mr. MATHER. Yes, sir.

The CHAIRMAN. This is all proposed by the Mill's bill to be put on the free list?

Mr. MATHER. Yes, sir.

The CHAIRMAN. What will be the effect of that?

Mr. MATHER. We think we will be able to show you that it will close every industry of the country.

Senator HISCOCK. Where else do we get borax in this country? Mr. MATHER. Nowhere else except from Nevada and California. Senator HISCOCK. Nevada and California are the only States that produce it.

Mr. MATHER. In any appreciable quantities.

Senator HISCOCK. In these States how diversified are the deposits? Mr. MATHER. The deposits at Fish Lake and Keel's Marsh cover a great many thousand acres, as also in Death Valley and San Bernardino County, California.

Senator HISCOCK. What is the duty on this now?

Mr. MATHER. Five cents pound on pure boracic acid and refined borax, such as you see here; 4 cents a pound on commercial boracic acid, and 3 cents a pound on crude borax and also on borate of lime.

Senator HISCOCK. Is there anything else that would compete with these articles for the purposes for which they are used?

Mr. MATHER. I think that so far as boracic acid is concerned there has nothing yet been found that would take its place in many uses. Of course, so far as water in crystallization is concerned, and carbonate of soda, we have nothing to say. The boracic acid is the principal ingredient of borax and gives it all its value.

The CHAIRMAN. Where is that produced outside of our country? Mr. MATHER. In the springs of Tuscany; they are sometimes known as the boracic acid springs. It is made very largely from this deposit of borate of lime found in Turkey.

I have prepared a statement which will cover all the points, and enable you to grasp the question, I think, more quickly and clearly than otherwise, If it does not, I shall be glad to be questioned.

The CHAIRMAN. You may proceed to read your statement, if you please.

Mr. MATHER. It is barely thirty-two years since borax was first discovered in any portion of the United States, and its area is, so far as known, limited to the States of California and Nevada. Formerly we were dependent upon foreign countries for whatever supplies were required and had to pay the price then demanded-four times greater than that ruling since the discoveries of the article in this country. Although discovered in 1856 in California, it was not until about 1865 that any attempts were made to place the article upon the market, and this amounted to only a few hundred tons, sold at about 25 cents a pound in San Francisco. At that time, and for many years previous, a party representing a prominent English house practically controlled the market of this country, receiving the supplies either as refined borax or boracic acid, the latter being the essential ingredient in the borax of commerce.

It was not until about 1872 that the production of this article from either borate of soda or borate of lime was of sufficient magnitude to exert any influence upon the price in this country. Prior to this date it ruled from 28 to 35 cents per pound, as shown in the U. S. Geological Survey, 1883, page 566. The production was about 1,000 tons for 1873 from the States of California and Nevada, and has, with one or two slight variations, continued to increase yearly until some 5,000 tons were brought to market in 1887, and the price that year in San Francisco for concentrated (prismatic) borax, a commercial grade, was less than 5 cents per pound; and this, too, with a tariff of 5 cents a pound on refined borax and pure boracic acid, 4 cents on commercial boracic acid, and 3 cents on both borate of lime and crude borax.

It were useless to attempt to enumerate the various uses to which borax is applied, for it has entered into so many and has become therefrom so essential that it is a necessity and can not be dispensed with.

A studied effort has been made to show that borax, like sugar, petroleum, and other commodities, is controlled by a close trust, and that the parties to it are deriving large profits therefrom. Let us see what are the facts in the case. It has already been shown that when we were dependent upon the foreign article our consumers were then compelled to pay more than four times the price at which it could be bought at any time since the tariff of 1883 went into effect. That the quantity formerly consumed was limited, and that it was not until developments were made in this country and considerable quantities offered at reduced figures that our consumption assumed large proportions. The high price obtained for the foreign article stimulated research, and ex

tensive deposits were found, but by no means as rich as those in other parts of the world. A ruinous competition arose later among the various producers until it seemed a question as to who could stand the greatest loss.

With your permission I would like to read a little from the report of the Geological Survey.

The CHAIRMAN. Put it in as part of your remarks.'

Mr. MATHER. I will do that to show the position I take here as to why the price was reduced.

[From U. S. Geological Survey, 1883, page 566.]

HISTORY OF THE BORAX INDUSTRY ON THE PACIFIC COAST.

In considering the industrial and commercial history of borax on the Pacific coast, it is found that it has been marked by disappointment and loss almost from the first. Prior to any production being made in Nevada the price of this salt ruled everywhere at 28 to 35 cents per pound, figures that held with but litttle variation up till 1872, when the price dropped during the next two years as low as 64 cents in the San Francisco market. After touching this low figure the price of refined borax underwent some slight improvement and, advancing slowly, reached, about two years since, present rates, 11 to 13 cents per pound in New York, the controlling market in the United States. This sudden, extreme, and long-continued depression in the price of borax was due to the following principal causes, not to mention others of minor import:

As did the pioneer company in California, so did their successors at a later period greatly overestimate the extent and richness of their deposits as well as the rapidity with which the original stock, when removed, would be likely to replace itself. Spreading abroad, these exaggerated reports caused the foreign dealer, fearing an overproduction, to buy sparingly, a course that soon began to work a reduction of prices. The manufacturer, alarmed at this new rival in the field, began also to mark down the prices, making arrangements to enlarge his production at the same time, and thus the market became badly demoralized before these salines had as yet madé any large output or any overproduction had actually occurred, this latter being, in fact, an event that never came to pass. Meantime the Nevada producers met with disappointment on every hand. Their deposits were by no means as fruitful as they had anticipated. Being inexperienced in the business, they failed to put their borax upon the market in presentable shape, from which they suffered some discredit. The product of their refineries was disposed of hastily, and through such diverse channels as soon placed them in the attitude of mutual competitors, the hope of each company that they would, through the superior excellence of their deposits or their sharper management, be able to undersell their neighbors having prevented them from entering into any concerted action. Having been persistently kept up these evils and errors developed such obstacles as, in the course of a few years, forced every one of these companies to greatly curtail or wholly suspend operations; the production of borax on the Pacific coast having fallen off before the end of 1879 more than 70 per cent. from the largest amount previously made. With some advance in the price that took place in 1880, several works started up again, others having followed as prices further improved, until the present complement was got under way.

In calculating their chances for success, the Pacific coast manufacturers made the double mistake of overestimating their own and underestimating the resources of the foreign producers. It was supposed by these novices that the previously prevailing high prices of this commodity the world over were due to a scarcity of the raw material, or the difficulty of obtaining it in the countries where the principal supply was drawn-a manifest error, inasmuch as the borate deposits of Europe, India, and Peru, at the time the new industry was striving for a foothold on the west coast of the United States, were ample to meet all the requirements of commerce, the high prices that had always before obtained being the result of well-perfected combinations through which the entire business was controlled by a few persons who, besides controlling the trade, were able to supply any increased demand that might arise, and do so at reduced prices, were this necessary. These parties were therefore in a position to become dangerous competitors of any new rival entering the field.

The manufacturers of borax on the Pacific coast labor under many disadvantages as compared with producers elsewhere; labor and the other factors of production are dear; the borate fields are located in desert regions which afford few facilities for carrying on the business of refining, being at the same time distant several hundred miles inland from San Francisco, the principal entrepot and shipping point for the

entire country. After shipment at Sau Francisco the borax has to make long journeys by sea or land to reach the great marts of the world.

The recent discovery of heavy deposits of borates near the sea of Marmora, Asiatic Turkey, has also had a depressing effect.

[From U. S. Geological Survey, 1885, page 859.]

PRICE.

Only once before, and then but for a short time, has the price of borax been so low as at present, concentrated being quoted in New York at 8 cents, and in San Francisco at 8 cents per pound, these being the extreme figures for lots of ten tons or more. For the past two years the price has been steadily tending downwards, and that notwithstanding higher duties have meantime been imposed upon the imported article. The year 1883 opened with the price of borax in New York at 13 cents per pound. After declining to 11 cents, the price on the passage of the new tariff bill advanced to 15 cents, but fell back again before the end of the year to 11 cents, by reason of the heavy importations of boracic acid, which had been made in anticipation of a higher tariff. Early in 1884 the price was put down in London 33 per cent., causing a corresponding depression in the markets on this side, the decline having gone on slowly but steadily to the end of the year, when the extreme low figures above stated were reached. The causes that have contributed to so demoralize the market are various, the large production that has been going on of late all over the world being, of course, the principal one. Among the minor factors which have entered into the problem has been the disposition of English dealers to force down prices with a view to excluding from European markets the product of California. Then there has been the sharp competition between local producers, as well as the similar rivalries elsewhere. There may have been something also in the alleged willingness of the English lessees of the Tuscan salines to unduly depress prices in order to secure a renewal of their leases on more favorable terms. The prospect for any improvement in prices is not very encouraging to the producer. That no advance can take place, except through some combination on the part of the principal producers is evident; but how any such concerted action can be brought about where the producing points are so widely separated is not easy to see.

FOREIGN COMPETITION.

While no new uses for this salt, or at least none of much importance, are being introduced, new sources of supply are constantly being discovered. Besides the new deposits of borax found in California, large beds of borate of lime have been discovered lately on the eastern side of the Andes, in the State of La Plata, South America, much of this material being rich enough to bear transportation to Liverpool. Chili exported 32,923 quintals of borate of lime in 1883. The discovery of borax in Asiatic Turkey, not far from the Bosphorus, as announced a year or two since, seems also to have been one of considerable magnitude, the French having shipped lately large quantities to Havre. Meantime the exportation of the crude substance from the west coast of South America and from India has gone on actively, while the salines of Tuscany have kept up their usual production; the latest statistics published showing exports of boracic acid from Italy as follows: 1877, 2,697 long tons; 1878, 3,433 tons; 1879, 2,505 tons.

Sometime in 1887 a consultation of eight or ten leading producers was held, and it was finally decided, as I understand it, that while continuing to supply the article in whatever quantities the entire country would take or consume that this should be done at a fair profit over and above the cost of placing it upon the market. This I hold to be sound business sense. That it had been at any former time sold lower and at prices that did not pay the cost of extracting and placing upon the market, and to expect that this state of things should continue indefinitely in the interest of the consumer were as ridiculous as to suppose because the railroads at one time under sharp competition carried passengers, first class, from San Francisco to Omaha, a distance of 2,000 miles, for $5, that they should thereafter always continue to do so.

This understanding between some eight or ten parties possesses little or no binding force, leaves each one practically free to dispose of his own product, and does not place it in the absolute control of any syndicate or trust. If evidence of this were wanting we have it in the

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fact that when a producer, one of the parties to this supposed combination, failed, 350 tons of borax, belonging to him and hypothecated to secure a loan from a bank in San Francisco, was by this bank thrown upon the market of both that city and New York under ruling market rates, showing conclusively that its control was outside of any syndicate, trust, or combination whatever. That the prospect of the duty, as proposed by the Mills bill, being entirely taken off this article was the immediate occasion of the bank's proceeding scarcely rises to the dignity of a question.

BORACIC ACID.

As I have already stated, this is nowhere found in the natural state, or if so in paying quantities, but is emphatically a manufactured article, whether from the springs in Tuscany, as described by Consul Rice, of Leghorn (April, 1882, in his report to State Department), or from borate of lime, found in many parts of the world, but especially in Asia Minor, where there is a deposit called pandermite (from Panderma) covering some 13,000 acres (20 square miles), and of surpassing richness. I want to read a few lines from Professor Lock:

[From Journal of The Society of Arts, London, England, August 6, A. D. 1880, vol. 28, page 767.]

PANDERMITE, A NEW BORACIC MINERAL.

By C. G. WARNFORD LOCK.

Borax (biborate of soda) is one of the most useful and valuable natural salts, and a sufficient supply of it is essential to the existence of an important manufacturepottery-besides being eminently adapted to many other uses. The production of borax has long been inadequate to the demand, and has favored the utilization of native boracic acid and borates of lime, of magnesia, and of lime and soda. Our markets are at present supplied from distant and diverse sources. Borax comes principally from Thibet and other trans-Himalayan territories, on the one hand, and from California on the other, with very small occasional contributions from Peru and Chili. Boracic acid is commercially produced only in Tuscany, and is consumed chiefly in Continental Europe. Borates of lime and of magnesia have not hitherto been shipped in any quantity to this country. All these products I have described at length in the article "Borax," in "Sproe's Encyclopedia." I have now to deal with a new commercial borate, which, on the score of geographical position, abundance, cheapness of working, and easy manipulation, is certainly destined in a great measure to rule the markets of Europe, and particularly of Great Britain.

The new field lies on the Tchinar-Sau, a small stream feeding the Rhyndacus River, whose outlet is in the Sea of Marmora, near the port of Panderma, on the Asiatic shore. It embraces the villages of Sultan-Tchair, Yildiz, and Omerli, and the guardhouse of the Demircapon Pass. The area of the field is computed at over 13,000 acres (20 square miles). Its eastern confine nearly abuts upon the Rhyndacus, which has been navigated by steamers up to a point called Balakeser. A company has been formed for deepening and improving the stream, and a railway has been projected from Panderma to Balakeser. The wagon road has hitherto been utilized for transporting the mineral, the distance from Panderma to the western edge of the field being about 40 English miles. The port of Panderma is regularly frequented by local steamers and offers every convenience for shipping.

The field is situated in a basin of Tertiary age, surrounded by volcanic rocks, which vary from granite on the east to trachyte on the north, and columnar basalt on the west. Several basaltic hills and dykes protrude in different portions of the basin, and the presence of hot and mineral springs further testifies to the volcanic influences which have been at work, and in which, doubtless, originated the boracic mineral. The latter occurs in a stratum at the bottom of an enormous bed of gypsum, its greater specific gravity probably impelling it downwards while the whole mass was yet in a soft state. Several feet of clay cover the gypsum bed, which is here 60 to 70 feet thick, though in places it attains to double that thickness.

The boraciferous stratum varies in depth; it has been proved for a vertical distance of 45 feet. The mineral exists in closely packed nodules, of very irregular size and shape, and of all weights up to a ton. Von Rath has named it "Pandermite," from the port of shipment.