PARAGRAPH 38-OLIVE OIL.

in the proposed bill, by my present figures, to only 4 cents per gallon; that is, it comes in in bottles, under the bill, at 30 cents per gallon, while at a 20 per cent ad valorem rate, on the basis of cost of $1.30 a gallon on the other side, the bulk product would pay 26 cents a gallon. My client is interested in the preservation of as wide a differential between the olive oil in bulk and olive oil in packages as it is fair should be maintained.

In this connection I desire to present to the committee a very brief compilation of the duty on olive oil in Canada, France, Germany, Mexico, Spain, Italy, and Greece, giving to you both the producing countries and the distributing countries. These statistics are prepared by the Division of Foreign Tariffs of the Bureau of Foreign and Domestic Commerce, of the Department of Commerce and Labor, and I thought they would be of convenience to the committee. It shows the present duty in Canada, a nonproducing country, of 15 per cent ad valorem. The present duty in Germany, a nonproducing country, is not quite 8 cents a gallon. That is on the bulk. In Germany the difference between the oil in bulk and the oil in jars and receptacles, ready for distribution, is 2 to 1; in Greece the difference is 3 to 1.

We think it is fair that the duty should be less in the United States. I would say as a fair proposition that the duty on the oil should be placed at a specific duty of 20 cents a gallon, which would be a present ad valorem duty of about 15 per cent. The specific duty on the finished product is 30 cents per gallon, as provided in the bill. We think that we have some justification in talking to you because in the year just concluded the Pompeian Co. imported and packed not quite half a million gallons of olive oil, and we think the duty on the finished product should be 40 cents per gallon.

I have here the statistics of growth in the importations of olive oil in the last few years, from 1907 to 1911, compiled by the Bureau of Statistics. They are left from the brief, and I will ask to incorporate them in the record.

These show that the price is rising much more rapidly than the quantity imported. I do not think anybody can honestly promise a continuance of the present prices, even if the duty is reduced as proposed by this bill, because the demand all over the world is growing enormously, and the length of time that is required to bring an olive grove into bearing is such that we can not foresee any very great increase in the production of olive oil in the immediate future.

Congress has at all times recognized this difference in the duty between the bulk and package, and still continues to recognize it in the pending House bill.

There is another phase of this question which I wish to bring to your attention, and that is of the 500,000 gallons imported by the Pompeian Co. in the last year, half of it, or 250,000 gallons, were distributed among the drug trade of the United States. There is a very largely increasing use of olive oil as a medicine and as an emollient, and we think that unless we can get the committee to help us maintain this lower duty the American people will eventually have to pay a higher price for their olive oil, and that if the duty is maintained as provided

PARAGRAPH 38-OLIVE OIL.

in this bill, amended as I have suggested it, the present price of olive oil can probably be maintained

I do not want to make any misrepresentations by saying that the price can be materially reduced even if the duty is reduced, because the price of the raw product seems to be rising all over the world, and has steadily progressed in the last five years.

I do not know that it is necessary to take the time of the committee to discuss the California situation, but if my information is correct, the entire product of California is only 300,000 gallons, and within the last year the Pompeian Co. has shipped 30,000 gallons into the State of California, so that the product of the State of California is not sufficient for the Pacific coast region alone.

Mr. NEEDHAM. Is not that because your oil is a much cheaper grade?

We

Mr. BRIGHT. No; we think our oil is the best in the world. pay the highest price for it abroad, and we think it is better than the California oil.

Mr. NEEDHAM. Is it not universally conceded that the California oil is the best oil in the world?

Mr. BRIGHT. Yes, sir; but we do not believe that conception is correct. We have spent a great many thousand dollars trying to persuade the American people that a product packed as our product is packed, under the most absolutely sanitary conditions conceivable, is as good as a product bearing a foreign label.

Mr. NEEDHAM. Is your product a pure product?

Mr. BRIGHT. Yes, sir.

Mr. NEEDHAM. Is it not mixed with cottonseed oil?

Mr. BRIGHT. Absolutely not a fraction of a tenth of 1 per cent of cottonseed oil. We are next to the Bureau of Chemistry, and they will tell you they can discover a fraction of one-half of 1 per cent of cottonseed oil. Olive oil formerly was adulterated at Porto Franco and shipped into this or any other country, but our olive oil is absolutely pure. That is our pride.

Mr. NEEDHAM. You can not get the same price as California, can you?

Mr. BRIGHT. We are not trying to get the high prices. We are not aiming at the high price California gets. We are aiming to make as cheap a product as possible. That is our purpose. The Pompeian Co. handled last year, if our figures are correct, five gallons for every three gallons produced by the State of California.

Mr. NEEDHAM. Do you think that if olive oil were put on the free list it would reduce the price to the consumer?

Mr. BRIGHT. I do not really know whether it would for any very long time.

Mr. NEEDHAM. Do you think it would reduce it for the present, for the moment?

Mr. BRIGHT. I think probably it would.

Mr. NEEDHAM. How much of the duty is added to the price, which you add to the price?

Mr. BRIGHT. I can not answer that question. The supply varies so it is hard to tell. We keep our product at a fixed price. We dis

PARAGRAPH 38-OLIVE OIL.

tribute it at wholesale. The increased demand is such that individuals to whom we distribute have been erasing the price that is printed on the package and charging a higher price for it.

Mr. HILL. How do you do that keep your price at a fixed price with a varying supply?

Mr. BRIGHT. The company has done it up to this time.

Mr. HILL. Is there any agreement among the dealers to do it? Mr. BRIGHT. No, sir. We do not know anybody that operates in the olive-oil business except the foreign grower and the American. consumer whom we reach through our distributers.

Mr. HILL. You must make the price high in the beginning, to cover all the short supply, and then keep it up when the supply is greater. Mr. BRIGHT. The time will come when the price will have to be changed if conditions are not changed in the production of olive oil on the other side. If we had several years of bad season in the olivegrowing countries the price of olive oil, our price, would have to be put up. But we have been able to maintain it largely because of the great quantities that we handle. We made a great deal of money to begin with. We did not make so much per gallon, because the price has risen not quite 80 per cent in the past five years

Mr. KITCHIN. What per cent of the olive oil consumed in this country do you import?

Mr. BRIGHT. The United States imported last year, in 1911, altogether 4,400,000 gallons. We imported about 300,000 of those. Last year our business grew so enormously that we imported 500,000 gallons, half a million gallons of olive oil.

Mr. KITCHIN. There are a great many other competitors with you? Mr. BRIGHT. There is constant competition.

Mr. KITCHIN. How is it you have all been able to fix and maintain this same identical price for the last four years?

Mr. BRIGHT. We have maintained the price ourselves without any consideration for anybody else. I can not tell you what the prices are at which other companies sell their products. There are a great number of importers who import and put up the product. We have maintained our price because it is good business to maintain that price. The wide distribution of the product and the wide advertisement of the product at that price is good business.

Mr. PALMER. What proportion of the imports are in bulk as you import it?

Mr. BRIGHT. Every ounce.

Mr. PALMER. What proportion of the total imports into this country?

Mr. BRIGHT. I can not give you those figures, but we have at this time 1,200 casks of olive oil right in the plant here in Washington in bulk.

Mr. PALMER. There are other concerns in the country engaged in the same business as you are?

Mr. BRIGHT. I think there are other concerns that import the bulk oil, but I know of no other concern that has the same business as this company. That is only a part of other businesses. But we have no business whatever except the importation of olive oil in bulk and its redistribution in packages.

PARAGRAPH 38-OLIVE OIL.

Mr. SHACKLEFORD. In the process of refining this olive oil what materials are combined to increase its volume?

Mr. BRIGHT. Nothing. The olive oil that is imported is placed in the plant here, packed under sanitary conditions in tins, and distributed.

Mr. SHACKLEFORD. Cottonseed oil is not combined with it?

Mr. BRIGHT. Absolutely not the fraction of an ounce. I have said that before. We are immediately next door to the Bureau of Chemistry and we are subject, of course, to the pure food and drug act. Every bit of olive oil packed in the United States is subject to it. We would be liable to be caught up immediately if we did adulterate our product in the slightest and called it olive oil.

Mr. SHACKLEFORD. Is there not a product on record called olive oil that has in it a combination of cottonseed oil?

Mr. BRIGHT. I can not answer that question. I do not know of any. But cottonseed oil is used very largely as a food product, and is a very good food product.

Mr. HARRISON. Is it true, as reported, that cottonseed oil is sent from this country to one of the States of Italy, bottled there, and sent over here as olive oil?

Mr. BRIGHT. I have heard of it, but I can not verify it, and under the pure food and drug law I don't believe it possible.

Mr. KITCHIN. Which is the better of the food products-olive oil or cottonseed oil?

Mr. BRIGHT. I have never tasted cottonseed oil, when I knew it, and I can not, therefore, answer your question from personal knowledge.

Mr. SHACKLEFORD. What is your firm?

Mr. BRIGHT. The Pompeian Co. You have seen the advertisements in the street cars in Washington, and we would be delighted to have any of you see the plant, if you are interested in seeing it, at any time.

I thank you very much.

NOTE. The conventional tariff applies to imports from the United States.

NOTE. The duty is payable in paper drachmas at the rate of 1.45 drachmas paper to 1 drachma gold.
The value of the paper drachma is now practically equal to that of the gold drachma, and the actual duty,
therefore, amounts to 145 per cent of the rates given above.

[The Roessler & Hasslacher Chemical Co., 100 William Street, New York.]
Imports of merchandise-years ending June 30, 1907-1911.

OLIVE OIL, EXCEPT FOR MANUFACTURING OR MECHANICAL PURPOSES (DUTIABLE).