NITRATE OF SODA AN ALADDIN’S LAMP
_Extensive Use of Nitrates as Fertilizers--Enormous Contributions
to Chilean Revenues--Résumé of Exportations--Description of the
Industry--How the Deposits Lie--Iodine a By-product--Stock of
Saltpetre in Reserve--The Trust and Production--Estimates of
Ultimate Exhaustion--A Third of a Century More of Prosperous
Existence--Shipments not Affected by Panama Canal--Copper
a Source of Wealth--Output in Northern Districts--Further
Development--Coal--Silver Mines Productive in the Past--Prospect
of Future Exploitation._
Is nitrate of soda, the saltpetre of commerce, a national blessing
or a national curse?
After the war with Peru and Bolivia, by which Chile added to her
territory 1,200 miles of seacoast, including the Bolivian Province
of Antofagasta and the Peruvian Province of Tarapacá, a Chilean
naval commander was credited with the foreboding prophecy that the
nitrates would ruin Chile as they had ruined Peru.
In its political phase the question may be answered according to
the bias of the individual. It enters into the subjects concerning
which Chileans engage in heated controversies when discussing
policies and tendencies, or criticising government expenditures.
But this aspect has no direct bearing on the naked economic facts
of production and the addition to the nutritious substances of the
world’s soil.
Nitrates are among the most extensively used fertilizers known to
agriculture, and the demand for them grows. Their relation to the
fiscal system of Chile may be understood when it is known that from
85 to 87 per cent of the total revenues is derived from the export
tax on the saltpetre products. This impost is, in terms of English
currency, at the rate of 28 pence per 46 kilograms or Spanish
quintal of 101.4 pounds, relatively 55 cents for each 100 pounds.
Their ratio of contribution to the national wealth is shown by an
analysis for a given year, when the total value of the exports
was $73,786,000 gold, of which $53,565,000 was nitrates and the
by-product of iodine, while the balance of $20,221,000 was composed
of mineral and agricultural products and manufactured articles.
In Chilean currency the figures were $202,153,000, of which the
nitrates constituted $146,756,000. In the last quarter of a century
the nitrate beds have yielded to the Chilean government $273,000,000
gold, and it is estimated that during the next twenty-five years,
on the basis of the present export tax, the revenue will amount to
$436,000,000.
The first exportations were made in 1832. They continued on a small
scale until the war in which Peru lost the Province of Tarapacá, and
their exploitation on a large scale may be said to have begun in
1882 under the Chilean administration. In that year the exportations
amounted to 10,701,000 Spanish quintals. In the period inclusive
from 1832 to 1904 the total reached the enormous sum of 602,438,000
quintals, or 61,087,213,200 pounds, equal to 27,271,077 long tons of
2,240 pounds. The personal histories of the individuals who engaged
in the exploitation of the saltpetre deposits are as romantic as
the experiences of the bonanza mining-kings. Nitrate kings have
risen and thriven and have held their courts with titled courtiers
in their train. Colossal fortunes have been made and plain commoners
have become peers of England treading the golden path which was
paved with saltpetre.
So little is known about the nitrate industry that I venture
to repeat the substance of a description which I found at once
entertaining and instructive.[11]
The saltpetre or nitrate zone embraces the extension comprehended
between the Camarones in south latitude 19° 11′ on the north and
parallel 27° to the port of Caldera on the south, 450 miles in
length. The distance which separates it from the coast varies. In
the northern part the sea is only 15 miles away; in the South it
is 93 miles distant.
11 For the facts here given I am indebted, through the courtesy
of Minister Walker Martinez, to Mr. J. J. Campana, of Iquique; but
the opinions are my own.
The deposits of saltpetre situated in the Province of Tarapacá
occupy the small folds and the gently rising hills which extend
from the west of the pampas of Tamarugal. To the south of the Loa
River these deposits follow no lode, and they are met with in the
midst of the great pampas as well as in the folds of some hills.
But they extend always in a zone which runs to a distance varying
from 37 to 93 miles from the coast. The short space that separates
them from the sea makes easy the access to the neighboring ports
by means of the railroads through the ravines which traverse the
Cordillera of the coast.
The saltpetre is found mixed with other substances and forming an
irregular layer, frequently broken up into barren parts, in which
generally common salt dominates, or simply a conglomeration of
clay, gravel, and sulphate of soda.
The layer or covering which contains the nitrate is encountered
at a very slight depth, covered by a fold of the conglomeration
indicated, and which in general is altogether sterile, though in
some parts, principally in the North, it contains a regular vein
of nitrate.
The vein of nitrate of soda in the layer which contains it is quite
variable, the highest proportion being in the Province of Tarapacá,
where in some points the medium quality amounts to 60 per cent. In
the southern region this quality of _caliche_, or crude material,
diminishes, and does not exceed an average of 30 per cent.
The name _caliche_ is given to the raw material which contains the
saltpetre that is found in the beds of deposits mixed with common
salt, sulphate of soda, clay, and other foreign substances. The
thickness of the layer is decidedly variable, and fluctuates between
a few inches and three feet. Deposits of greater thickness exist,
but these never have a great extension.
The height above sea-level at which these deposits are met with
varies from 3,600 to 13,000 feet.
The layers composing a saltpetre deposit are:
1st. _Chuca._--This is formed by clay mixed with earth very fine
and evenly spread. The thickness of the _chuca_ generally does not
exceed an inch and a quarter.
2d. _Costra._--This layer, which forms the immediate covering for
the _caliche_, has a thickness fluctuating between four-fifths of
an inch and several feet.
3d. _Caliche._--This is the layer which contains the saltpetre,
and its thickness varies greatly in different places.
4th. _Conjelo_ and _cova_.--This is the last layer, which rests
upon the rock. It is formed by a mixture of common salt, various
sulphates, and other salts, but contains no saltpetre. Its thickness
is also very variable.
The limpid _caliche_ is taken to the finishing establishments,
where it is submitted to a process of purification which is founded
on the great solubility of nitrate of soda, superior to the other
salts which are in combination with it, in water heated to the
boiling-point. The solutions which result are carried by means of
troughs to great vats, where the nitrate of soda crystallizes along
with the potash, which exists in small quantity together with a
little common salt and a small amount of sulphates and impurities.
The quality of the saltpetre thus crystallized is 95 per cent
of nitrate of soda, and it is known by the name of ordinary or
current saltpetre. Refined saltpetre of the grade of 96 per cent
is also obtained by submitting the warm solutions to a light and
short decantation, by which there is left a part of the salt and
the impurities. The refined product is passed immediately to the
crystallizing vats. For this process powerful machinery is used
which can refine 1,000,000 pounds of saltpetre daily. The residue of
the nitrate of soda is known by the name of _ripio_. Its percentage
of saltpetre is estimated below 15.
The saltpetre zone is served with railways. These leave the various
ports and ascend to a height of 4,000 feet above sea-level, with
the exception of those of Caleta Buena and Junin, which stretch
from the summits of the neighboring Cordillera to the sea and are
united with the ports by means of automotors. The automotor _plano_
of Junin has a vertical height of 2,145 feet, and those of Caleta
Buena 2,430 feet.
The Granja or Challorcollo road traverses the pampas of Tamlugal,
and reaches the foot of the hill of Challorcollo. From this point
there is a hanging railway, which reaches the mines in the summit
of the hill at a height of 4,600 feet and is two miles long.
An important factor in the production of nitrates is coal, which
is used in large quantities, the consumption being not less than
400,000 tons annually. The prices fluctuate from 22 to 28 shillings
per ton. Generally English coal or that from Australia is used.
Chilean coal is not employed to any extent. The home production is
hardly sufficient for the needs of the railroads and the industries
in the southern part of the country. Besides, the ships which
carry the nitrates to foreign ports return with coal as the cargo.
The freight rates to Europe for the nitrates vary from 20 to 30
shillings per ton.
In all the deposits iodine is found formed of salts with the base of
soda. The salts of iodine dissolve along with the nitrate of soda,
and later are extracted from the mother waters which have remained
after the crystallization of the saltpetre. The process is simple
and cheap, and the iodine is obtained in the metallic state and
perfectly pure, in which condition it is a commercial commodity.
The small consumption of iodine in the industry has caused the
producers of the entire world to form a combination to limit the
production and fix its relation to consumption. The agreement
obliges all the saltpetre establishments of each country to withdraw
only a very small part of the iodine which their properties contain.
At some future period the refuse of the saltpetre will be worked
to extract the iodine.
The annual production of iodine is approximately 4,200 Spanish
quintals. The price of the substance is about 5½ pence per troy
ounce. The total export tax varies from $150,000 to $100,000.
To the east of the ports of Punta de Lobos and of Hurmillos is a
great salt field extending over an area of 32,000 _hectares_, or
80,000 acres. It is covered with common salt, or chloride of sodium.
The salt is perfectly pure and crystallized. The analyses have
given 99.99 per cent of chloride of sodium. The thickness of this
salt layer is not known. The deepest wells have reached 82 feet.
In a recent year 220,000 quintals were exported to the interior of
the country. The good quality of this salt allows it to be used in
every class of industry and also for domestic purposes. Besides
the great salt bed named, there are various others, but these are
not so important.
The number of laborers employed in the nitrate industry varies from
20,000 to 25,000 according to the activity of the season. Production
in some years has been curtailed through the scarcity of labor or
through strikes and similar causes.
The principal application of saltpetre is in agriculture, it being
employed as manure for land worn out by many years of continuous
cultivation. Some crops give 25 per cent to 30 per cent more than
those which are raised without fertilizing the ground with nitrates.
In special cases the returns have been much larger, and it is on
this account that this fertilizer has obtained so considerable an
increase in all markets.
The stock of saltpetre was calculated for the entire nitrate zone
as of January 1, 1900, approximately as follows:
Spanish Quintals
Tarapacá--Private properties 407,160,000
State properties 165,888,513
-----------
Total 573,048,513
Toco--Private properties 138,112,000
State properties 87,726,769
-----------
Total 225,838,769
Aguas Blancas and Antofagasta--Private
properties 153,000,000
Taltal--Private properties 151,984,500
-------------
Grand total of nitrates 1,103,871,782
To this calculation should be added the nitrates which may exist
in the pampas without having been discovered up to this time both
in Tarapacá and in the districts of the South. In Tarapacá are the
pampas of Orcoma, in which have been found layers of saltpetre of
low grade, but which later may prove worth developing, though not
while deposits of greater importance exist and while the present
prices are maintained.
There are also deposits of saltpetre to the north of Pisagua in
the pampas of Tacna, but in small quantity and in isolated beds.
Deducting the output from the time the calculation was made to
1905, the total would be 951,754,000 quintals then untouched.
The nitrate fields which have not been reconnoitred have been
estimated at 500,000,000 quintals, but that is rather a guess than
a calculation. A safer assumption would be 300,000,000 quintals.
The Antofagasta district has come up to expectations. Approximately,
then, it may be said that in 1905 Chile had a nitrate reserve of
a billion and a quarter (1,250,000,000) quintals of fertilizing
material for the world’s needs. That is a prodigious quantity, but
not an inexhaustible one. In the eleven years from 1894 to 1904
inclusive the exports increased at an average rate of 1,000,000
quintals annually. They were 23,947,000 in 1894; in 1904, 32,387,000
quintals.
The industry is in every sense a modern one, for it is controlled
by a combination, or trust. This arrangement has one good feature:
it insures reliable statistical data. The prospect as to production
may be readily grasped when the explanation is made that the output
for the year which ended with the first quarter of 1905 was placed
at 36,000,000 Spanish quintals as against 32,387,000 the previous
year. This means a direct revenue of $20,000,000 gold as long as the
rate of production is maintained. A lowering of prices might cause
the output to be lessened a few million pounds, but the world’s
demand is steady enough to assume that for the present period these
figures may stand substantially without change.
In the entire nitrate zone there are about 100 _oficinas_, or
clarifying establishments. The original combination of the producers,
or trust, was for five years, and began March 31, 1901. The amount
of saltpetre which the _oficinas_ may produce is fixed annually by
a directorate. The exportation cannot be less than the previous
year’s consumption.
If the rate of production fixed by the combination during recent
years should be maintained without further change, there would remain
33 to 35 years more of nitrate exploitation on the present scale.
Nothing, however, is more improbable. The product will be increased
as rapidly as good prices can be obtained, and the experience of
the last ten years has shown that the consumption grows fast enough
to justify the larger output. No combination of producers can keep
new capital from coming into the nitrate fields, for no vague fear
of the future will be strong enough to cause the government to
withdraw from rental for an indefinite period its nitrate properties.
The new capital wants quick returns on the investment. It urges
advertising, spending more money in the propaganda maintained to
educate the world in the value of saltpetre as a fertilizer.
Against constant pressure for widening the market may come
competition from artificial products, or new discoveries of nitrate
fields in the desert of Sahara or in California that will terminate
the monopoly of production and cause the export tax to be lowered.
But while the profits might be lessened from some such cause, it
does not follow that the production would be curtailed. It would
the more likely be swollen. Expert opinion is that the existing
_oficinas_ could double their output. The profit which now accrues
from an annual production of 35,000,000 or 36,000,000 quintals
could be spread over 50,000,000 quintals and still show a margin
of gain. Thus in any view the quantity of saltpetre extracted is
likely to grow with each year, subject only to temporary checks or
fluctuations.
Studied in every light, Chile’s Aladdin’s lamp flickers, for the
life of the nitrate industry as a national wealth producer draws
to a close. A third of a century to forty years reasonably may be
fixed as the term of its existence. After that will remain the
debris of the industry, and possibly before the beds approach
exhaustion, irrigation will make the dead pampas blossom with the
luxuriance of tropical agriculture, and the present sparse and
artificially sustained population will be supplanted by populous
farming communities.
In the opening chapter I have stated that the Panama Canal in its
ultimate economic influence will not affect the nitrates or be
affected by them, because their life is limited to the infancy of
the waterway, while, during the period of their existence that may
remain after it is opened to traffic, the bulky nature of the cargo
which must pay the tolls counteracts the possible shortening of
the distance. It may develop that other commercial considerations
will cause some diversion of the nitrate carrying-trade through the
Canal, but this will be chiefly for the gulf ports and the Atlantic
coast of the United States. It is not likely to become important,
since the market for saltpetre fertilizers is mainly in Europe.
England takes directly and for the Continent between 7,000,000 and
8,000,000 quintals annually, Germany about 1,000,000 more, and
France 5,000,000 quintals. Other European countries import from
500,000 up to 2,000,000 quintals. The east coast of the United
States imports 5,000,000 quintals, or not more than 15 to 20 per
cent of the total production, though the consumption is a growing
one and is stimulated by systematic advertising. This proportion
may increase without materially lessening the cargoes of nitrates
which will be transported through the Straits or around Cape Horn
to Liverpool, Hamburg, and Havre.
After the nitrates, copper is the most productive source of mineral
wealth, and is the most important element in metal mining. The
output ranges from 30,000 to 35,000 tons each year. The heaviest
output is in the northern region, where the outlet is through the
ports of Coquimbo and Antofagasta, but the single district of Lota
in the South has a larger output than either of them. It contributes
from 7,000 tons upward in bars and ingots. The Guayacan mines in
the Department of Ovalle have a similar output. In the district of
Chuquicamata, which is in the volcanic Cordilleras, 160 miles from
Antofagasta by the railway and 9,000 feet above sea-level, are half
a dozen copper mines producing 18,000 to 20,000 tons of ore which
averages 18 per cent. The area is 8 square miles of country rock
of pure granite with true fissure lodes, and it is estimated that
there are 15,000,000 tons of decomposed rock averaging one-half of
1 per cent of copper. In the Capopo district are a group of copper
mines which have a monthly output of 2,500 or 2,600 tons of ore,
the sulphides predominating in most of them.
The copper industry of Chile has been a reasonably profitable and
steady one, and without doubt it is capable of a considerable
expansion by the application of modern methods and the more general
adoption of improved machinery. The bulk of the shipments is in
the form of fine bar copper, though both regulus and copper ores
are exported.
The coal mines are located in the Provinces of Concepcion and
Arauco, the most productive veins being at Lota and Coronel. This
is utilized on the railways and in local industries as well as in
coaling vessels, but the output does not equal the demand, and
Chile may be looked upon as an importer of coal for an indefinite
period. There is lignite to the south toward the Straits, but its
commercial value has not been demonstrated.
Iron ore has been found in the Province of Coquimbo and elsewhere,
but the production is light. The government made valuable concessions
to a French company which agreed to establish an iron industry in
Valdivia.
The gold that exists in the North, where the lodes are quartz, and
the _lavaderos_, or washings, in the alluvial soil of Tierra del
Fuego are not likely to become important sources of national wealth,
though new discoveries which prove worth working are reported from
time to time.
In times past, Chilean silver mines have been quite productive.
The most famous were the Chanarcillo and Chimbote in the Copiapo
district, which a few years ago were declared to be worked out.
A group in the Iquique region includes the mineral section of
Huantayaja. The total output from this group during the ten years
preceding 1892 was placed at $22,000,000. After that the production
decreased, though it was said to average $400,000 annually. The
depth of workings in these mines varies from 200 to 2,000 feet.
The general character of the ore is chlorides, and the formation
of the rock is porphyritic and calcareous. White silver about 95
per cent pure and the very rich ores are found in pockets near the
contact of the calcareous porphyritic rocks. Near these mines is the
mineral section of Santa Rosa which includes the Consequencia and
the Pansio. The latter is said to have produced $1,600,000 during
the last ten years.
In the Province of Antofagasta are the two silver districts known
as Caracoles and Inca Caracoles. The former is 110 miles from the
coast. These mines were discovered so recently as 1869. The lodes
were of extraordinary richness. The ores were chiefly chlorides,
iodides, and mixtures of chlorides and sulphides. The ore deposits
were superficial, and the ore generally was found in pockets. The
shafts were from 300 to 600 feet deep, though one of them had a
depth of 2,500 feet. Deep mining was abandoned, as it was shown
that the veins split up into small fissures. The output of the
Caracoles group was estimated at 60,000,000 ounces of fine silver up
to the time when the mines were practically abandoned. At present
the output is said not to exceed a few thousand ounces.
The Inca Caracoles mines are situated near the town of Calama, 150
miles from the port of Antofagasta. The country rock is porphyry,
and the lodes range from 3 to 6 feet in width. The ore is chiefly
chloride, and averages 40 ounces to the ton. Heavy freights and the
absence of water have prevented the development of this group, and
the prospective output cannot be accurately estimated. However, it
seems to have great possibilities.
Neither copper nor silver ever will suffice to make up the deficiency
in the national wealth caused by the gradual exhaustion of the
nitrate beds, yet increased transportation facilities and the
application of the newer processes give promise of a revival of
the mineral industry and an appreciable addition to the productive
resources of the country.