CHILE: RESOURCES AND INDUSTRIES
Although Chile is often compared to California, to which State it
has some but not a close resemblance in length, partial dryness,
earthquakes, and fruit, the specialty of Chile is not shared by
California. Chile and nitrates are almost synonymous terms. A thought
of one suggests the other. The greater part of the nitrate country
earlier belonged to Peru, some also to Bolivia; and both countries
still bewail their loss.
MINING
The =Nitrate Fields= we know are in the north, chiefly in the Provinces
of Tarapacá, Antofagasta, and Atacama. If this desert land does not
blossom as the rose, it produces the wherewithal to make other fields
blossom, and the wealth to purchase the roses. The richest deposits
are mainly along a stretch of 300 miles from Pisagua in Tarapacá, to
Coquimbo. With an average width of 2¹⁄₂ miles, the fields are at a
distance of from 10 to 80 miles back from the coast, and at a height
of 2000-5000 feet. The deposits, which are not in continuous fields,
are sometimes on the surface, but oftener overlaid with strata of
earth several feet thick. The raw material called _caliche_ contains
from 20 to 65 per cent nitrate of soda. After pickling in tanks 8-12
hours, the liquid, _caldo_, is run off, the sand and refuse dropping
to the bottom. When ready for export the article carries 15-16 per
cent nitrogen and 36 per cent sodium. Commercial nitrate is a white
cheese-like substance, which is used in manufacturing the highest
grade of gunpowder, also to produce nitric and sulphuric acid; but the
bulk of it in ordinary times is employed as a fertilizer, doubling and
tripling the harvest. Within recent years the demand and in consequence
the production has greatly varied, the partial recovery in 1920 being
soon followed by a depression.
A by-product is a yellow liquid, which being chemically treated leaves
a blue crystal, iodine, which costs as much an ounce as saltpetre per
100 pounds. Being worth $700-$800 a cask it is shipped in treasure
vaults with bullion. The nitrate establishments called _oficinas_
provide good salaries, and the best possible quarters for their
officials, and they are interesting to visit. As a mineral, the nitrate
is distinguished from guano although believed by some to have the same
origin. British companies have long been engaged in this industry.
American interests have more recently acquired holdings. The Du Ponts
have three properties covering 14,000 acres.
The chief ports of this region are Iquique and Antofagasta, Pisagua
being a smaller port visited only by the _caletero_ or the strictly
freight boats. Iquique is a more agreeable city than in former days,
when water was sometimes $2 a gallon, and people drank champagne, they
said, because water was too expensive. Now the dust of the streets is
laid by sprinklers, some people have bath rooms, a few even fountains
in patios. Antofagasta is also a desert place, unattractive to look at,
but with good shops, business houses, and fair hotels. The water comes
a distance of nearly 200 miles, the source more than two miles above
the sea.
=Potash.= In addition to nitrates Chile possesses extensive beds of
useful potash one of which is estimated to contain nearly 7,000,000
tons easy of exploitation.
=Copper.= The property of the Chile Copper Company (one of the
Guggenheim interests) at Chuquicamata is said to be the largest copper
deposit known in the world. About 2000 of the 9600 acres of the claim
are mineralized. The outcrop of copper is one and a half miles in
length. It has been proved below to a width of 1800 feet and a length
of 7500 feet. Ten of the 2080 shafts are over 1000 feet in depth, and
at 1500 feet the ore is of commercial value. Over 700,000,000 tons of
positive and probable ore have been developed, carrying an average
value of 2.12 per cent copper. The reduction plant has a capacity of
15,000 tons a day, the refinery of 180,000,000 pounds a year. With a
90 per cent extraction the yield is 96 pounds of copper per ton. At
the port of Tocopilla, north of Antofagasta, the Company has a power
station where oil from California is used to generate a power of
24,000-27,000 kilowatts needed at Chuquicamata. This is transported by
wire across country a distance of 100 miles. At normal prices the cost
of copper production with delivery in New York or Europe is $121 a ton,
or about 6 cents a pound; higher with war time conditions which still
obtain (1921). From the 15,000 ton plant in full service 175,000,000
pounds of copper would be produced annually. In 1920, 55,617,000 pounds
were produced, the largest amount from any mine in Chile. In 1916
important mines belonging to the Calama Mining Company were added to
the Chile Company’s holdings.
The Braden Copper Company, another Guggenheim interest, owns about
2300 acres in the Province of O’Higgins. They have a concentrator, a
smelting and converting plant, a hydro-electric power plant with 800
kilowatt capacity and an electric and a steam railway; the latter,
43 miles long, connecting the property with Rancagua, which is on
the Central Railway 43 miles southeast of Santiago. The ore is of
concentrating copper, a sulphide in brecciated andesite, around an
extinct volcano. It runs about 2.5 per cent, with an earlier production
cost in New York of 6.5 cents a pound, but now higher. In 1916,
1500-1800 men were employed. The plant, recently enlarged, is not
working to capacity. In 1917, 64,000,000 pounds were produced, over
77,000,000 in 1918, with diminishing demand, 40,000,000 in 1920.
Another American syndicate has acquired the Tamaya Copper Mines in
the Province of Coquimbo between Ovalle and Tongoy, the latter, a
minor port 27 miles south of Coquimbo, sheltered from north winds,
with smelting works in the place. With an efficient pumping plant and
other improvements installed, the mines are expected to yield large
production. Other companies, native, British, and French are engaged in
copper mining at Carrizal and elsewhere.
=Iron.= Coquimbo, a Province with local importance for agriculture, is
notable for its deposits of iron ore, said to amount to a billion tons.
Only one of these has been worked, a deposit located at Tofo, about
four miles east of Cruz Grande, and 30 north of the city of Coquimbo.
This property was leased in 1913 by the Bethlehem Steel Company from a
French Company which had developed the mine to some extent and produced
ore. The ore appearing as the top of a large hill will be mined by
electric shovels and transported by an electric railway to docks at
Cruz Grande. The amount of ore is very large though with exact tonnage
undetermined. The Company is still exploring the deposit at depth.
The mines and railway are completely equipped. At Cruz Grande a basin
dock has been constructed with large storage pockets into which the ore
will be discharged from the railway cars, and from which it will go
directly into the vessels. The Steel Company is constructing steamers
of 20,000 tons to carry the ore to the United States for use in their
furnaces. The ore is very pure averaging about 67.50 per cent iron.
It is a dense ore reddish black in color, a mixture of magnetite and
hematite.
The French Company formerly controlling Tofo had erected a steel plant
at Corral intending to transport the ore thither. There is no iron ore
near there and the plant is not operating.
Of the other deposits in Coquimbo and farther north some are of
considerable size, but none is located so near the coast as Tofo and
none has been developed.
=Other metals= existing in Chile are at present of less importance and
slight operation. A moderate gold output accompanies the production
of copper, and there is some placer mining, especially in the south.
Deposits are known to exist in many Provinces from Tacna to Tierra
del Fuego. Silver too exists, but its production is chiefly as a
by-product. Lead, zinc, molybdenum, and tungsten are exported in
limited quantities.
=Coal=, following nitrates, is of the first importance among ordinary
minerals, a source of large wealth though the production, about
1,700,000 tons yearly, is insufficient for the needs of the country.
Little is therefore exported and a good deal is normally imported from
Great Britain and Australia; until recently a little only from the
United States. Most of the mines in operation, owned by ten companies,
are near the ports of Talcahuano, Coronel, and Lota. The coal is not
equal in quality to the British, but it has been used by steamships,
railways, and mines with fair results. Coronel or Lota, five miles
apart on Arauco Bay, one or the other, is a regular port of call for
steamships. The Cousiño property at Lota was purchased in 1852 and
later was conducted by the son’s widow, under her administration the
greatest financial enterprise carried on by a Chilian. At her death
she was called the richest woman in the world, leaving a property of
$70,000,000. The capital of the company is $20,000,000. The mines are
one-fourth of a mile deep and extend under the sea, where there is good
rock and no drip. Here are streets, restaurants, offices, stalls for
horses, blacksmith shops, etc.
A British Company, the Arauco, in addition to coal properties operates
its own railway with 62 miles of main line and branches, besides
mining spurs. It has four daily trains from Concepción to Lota,
Coronel, and beyond, passing over the Bio-Bio River by a bridge of 1¹⁄₄
miles, the longest in South America. Of coal about 1¹⁄₂ million tons
are produced and as much more is imported.
=Petroleum= is believed by Chilians to exist in large quantities, but
the present development is infantile. It has been found in southern
Chile, on the Island of Chiloé and in the Patagonas district, as well
as in the north near the Bolivian frontier. Large quantities are
imported principally from Peru, normally about 400,000 tons a year.
Oil recently found in the Magallanes Territory is stated by experts
to be equal in quality to that found in Argentina. The extent of
the deposits seems to rival that of the famous fields of Comodoro
Rivadavia. Legislation to regulate the well drilling is proposed to
prevent inundation of deposits by subterranean streams, to restrict the
ownership to native Chilians or foreigners with Chilian families, and
to secure to the Government a 10 per cent royalty. A strong flow of
petroleum of great purity from a well about 300 feet deep has recently
been reported from Chiloé.
=Sulphur= comes from a largely producing mine at the foot of Mt.
Ollague, and from one of growing importance at Tacora on the Arica-La
Paz Railway. The deposits of Tacora are believed to contain 10 to 45
million tons of sulphur. In 1915 about 10,000 tons were produced in
Chile.
=Salt.= From various salt deposits, the salinas of Punta de Lobos and
several mountain lagoons, about $300,000 worth of salt was produced,
supplying the domestic market.
=Borax= is important, Chile furnishing about half of the world supply.
AGRICULTURE
Of large importance and value are the agricultural interests including
fruit, although the imports of such products are nearly double the
exports in value. About one eighth of the area of Chile consists of
arable land. The production should be greatly increased. Twenty million
acres are still available, and with better methods excellent results
might be secured. In 1914-15 about 25,000,000 bushels of wheat were
raised, half as many potatoes, and more than half as much hay; besides
barley, oats, beans, corn, etc. Considerable wheat is exported with
some barley, oats, rye, and legumes. Of 15,000,000 acres suitable for
wheat, only one fifth is in cultivation. It grows well from Aconcagua
to Cautín inclusive, but farther south the crops are uncertain. They
average 15-20 bushels an acre. Six hundred thousand acres are devoted
to alfalfa, which in favorable places gives three crops a year and
has roots ten feet long, a distinctive variety being formed here.
In irrigated valleys from Coquimbo north, corn gives two fine crops
annually. Potatoes flourish from Concepción south, in Chiloé yielding
250-350 bushels to the acre. Flax and sugar beets might be raised. Some
agricultural machines are now employed, in the neighborhood of 30,000.
=Fruit.= Delicious fruits of all temperate zone varieties and some of
the subtropical are raised, chiefly for home consumption, but with
export possibilities. Drying and canning of these is practised to
some extent, but might be done on a much larger and more profitable
scale. Excellent table grapes are raised; many vineyards devote their
product to wine making, the industry being especially developed in the
Provinces of Santiago, O’Higgins, and Colchagua. In the north, wine is
made of the port and sherry classes; in the central section light wines
of excellent quality, some of which are exported to the neighboring
countries. More wine however is imported of expensive varieties. The
vineyards are in general owned by natives, and according to location
are worth $200-$1000 an acre. Raisins are produced in quantity.
FORESTRY
This might become a more important industry, though now practised to a
considerable extent. It has been customary to burn a section of forest
at the close of summer, February, to get rid of the underbrush, and
later to cut down the trees, which must have suffered some injury. The
forest area is below the Bio-Bio River. On a tract of 100 square miles
extending from near Valdivia north to Temuco, the timber averages about
9000 feet to the acre. Farther south the woods are denser, as on the
Island of Chiloé. The greatest extent of forest is in Valdivia, the
next in Llanquihue and in Chiloé. On this Island a 60 mile railway was
constructed by the Government from Ancud at the northwest to Castro
south, on the east side, making a part of the forest accessible. Oak,
Chilian mahogany, laurel, ash, pine, and other hard and soft woods
are available. There are in Chile 3000 saw-mills and some pulp and
shingle mills. The first and second grades of wood, used for floors and
finished boards, bring $12-$18 per 1000 feet, ash $25; the third grade
is worth $8. Shingles are $3 per thousand. From the forests comes the
_quillay_ bark with a soapy substance for cleaning silk and fine linen,
of which $200,000 worth is annually exported to France, after being
prepared by two Chilian factories. Tannin, of which 15,000 tons are
annually used, is derived from bark of several kinds. With additional
railways planned and Government data furnished, there is opportunity
for good investments with moderate capital.
STOCK RAISING
Stock raising of various kinds is carried on quite extensively by
some large companies under British, German, or Chilian control, often
paying 20 per cent dividends. Sheep are in the lead, numbering probably
6,000,000, cattle 3,000,000, horses 725,000, half as many goats,
a third as many pigs, fewer donkeys, mules, alpacas, and llamas.
The horses are good, larger than those in Peru, and noted for their
excellent trotting, some making this as easy as a good pace or canter.
In 1916, 20,000,000 pounds of wool were produced, half of this in
Magallanes Territory not far from Punta Arenas, where there are more
than 3,000,000 sheep. The meat is of the finest quality; the farther
south the better the wool in thickness and length of staple.
The cattle are improving with the introduction of Shorthorns
and Herefords; there is some export, especially to Bolivia. The
3,000,000 at present might be increased ten fold. A British company
is constructing a frigorifico at Puerto Montt. The dairy industry
is important, with good cheese, bottled milk, and some condensed.
Goats are numerous in the mountains. Apiculture is practised and fine
honey is made. Fisheries are of great importance and value, at Juan
Fernandez, as also along the coast.
MANUFACTURING
Such industries are more developed in Chile than in any of the
countries previously considered. The 6200 manufactories with 80,000
operatives and an investment of $250,000,000 show great diversity.
There are saw mills, flour mills, breweries, sugar refineries, some
coarse sugar being imported from Peru, tanneries, furniture, and
shoe factories, with others commonly found. A cement factory pays
a quarterly dividend of 5 per cent, a brewery gave a semi-annual
dividend of 15 per cent. A new one is planned for Arica. More than
$12,000,000 are invested in the leather industries, with an output
worth $20,000,000. Twenty-two or more shoe factories are scattered in
various cities. Clothing and textiles are next in value of production,
followed by $10,000,000 worth of furniture and woodwork. Ship building
is important.
INVESTMENTS
Activities in Chile in the immediate future for which about $15,000,000
have been appropriated by the Government include work or equipment on
railways, roads, bridges, barracks, waterworks, sewer systems, building
construction, and port works. These furnish opportunities to which many
others may be added. The possibilities in agriculture, fruit raising
and canning are obvious; those in fisheries, saw mills and lumber,
development of water power, in factories of various kinds may be noted,
as well as for large capitalists in mining. A $10,000,000 contract
for the electrification and equipment of four zones of the Government
railways has been concluded with a combination of several American
interests.
THE EAST COAST