PARAGRAPH 3-OILS. BRIEF NO. 1. Paragraph 5. This paragraph covers a whole line of chemical and medicinal products. In fact, a great majority of the products that do not find special mention in other paragraphs fall in under this heading. We can truthfully claim that the present duty of 25 per cent is very fair and not too high, for it is safe to state that the importation exceeds the domestic production. So long as the paragraph is left written in this broad sense probably no exact figures can be given, besides many articles are imported without stating their exact nature or composition. While there may be comparatively few products that can be made here in competition to the imported goods, plus the proposed duty of 15 per cent, we do not hesitate to state that it is the honest opinion of every chemical and pharmaceutical manufacturer in this country familiar with the condition of the increased cost of labor, machinery, repairs, and nearly every item of expense, that a duty of 15 per cent means the shutting down and ceasing of many a manufacture now in operation. A duty of 15 per cent will mean a large importation of the overproduction from, especially, Germany, and that country will certainly welcome such a move on the part of the tariff legislators of the United States. We, as a good many other manufacturers, have capital invested, have spent a lot of time and money for the manufacture of products which fall under this paragraph, and we respectfully and earnestly request that no reduction is made. The consumption of these products is relatively limited, the cost of production, on account of increased expenses, as everyone familiar with the manufacture of chemicals in the United States will admit, is higher-all proves that we need a protection of at least 25 per cent, and that this rate is not excessive is, as above stated, undeniably proven by the fact that great numbers and quantities of these products are now imported. What argument can be more convincing than this latter fact? We have been manufacturing thymol and terpin hydrate for several years, and, we can state, without any profit to us. For example, on thymol the present duty of 25 per cent has not been sufficient to offset the increased cost of freight of the raw material from India to New York against the same from India to Hamburg. We are told the difference is about 1 shilling per hundredweight. As one gets only about 13-14 pounds thymol from 100 pounds raw material, you will note the shilling must be added to the 11-14 pounds finished product. Again, the resulting by-product, an oily cake, finds a very much better market in Europe, due to the relatively cheap cattle-food products found here, such as cottonseed cake, etc. The consumption in this country is equal to about 30,000 pounds-so you will note how very limited the manufacture can be— which again increases the cost per pound. We suggest a fixed duty would be more satisfactory, and propose as a fair and reasonable rate 50 cents a pound. For terpin-hydrate the same arguments, practically, hold; the consumption is about the same, etc. In this case also a fixed duty would be far more satisfactory, and we propose 10 cents a pound as a reasonable rate. BRIEF No. 2. Paragraph 22. Exactly the same arguments apply here as we give in the case of paragraph 5 (see Brief No. 1). Paragraph 22 is very broad and far reaching in its application, and it is impossible to treat the subject matter of this paragraph except in a general way. We can state in addition in the case of the manufacture of coaltar products or preparations which are covered by this paragraph that the raw materials used fall mostly under paragraphs 23 and 24, and it is proposed to take both of these off the free list and place a duty of 5 per cent on the products mentioned in paragraph 23 and a duty of 10 per cent on the products mentioned in paragraph 24. In other words, it is proposed to lower the duties on the finished products and raise the duties on the raw materials. This is surely not in order and we again respectfully request and urge that no reduction is made in paragraph 22. BRIEF No. 3. Paragraph 51. We respectfully request and urge that after the words "peppermint 25 cents per pound," the following is inserted: "Clove, pimento or allspice, nutmeg, mace, patchouli, 35 per cent ad valorem." This is altogether necessary, for the new tariff (see paragraph 41) proposes a range of duties on the raw materials used for the distillation of these various oils which averages about 20 per cent ad valorem. A difference of 15 per cent, or a 35 per cent duty, is therefore very fair and reasonable. We respectfully urge the committee to give especial attention to this feature of the bill. PARAGRAPH 3-OILS. BRIEF No. 4. Paragraph 54. This paragraph covers a whole range of products, some of which must be imported and others which can be made in this country. We may state that the latter form a large minority. We manufacture two products covered by this paragraph, namely, heliotropin and terpineol. We respectfully request and urge that both of these products are taken out of this paragraph and given specifies duties as follows: Heliotropin 50 cents a pound, terpineol 6 cents a pound. Heliotropin. The raw material used for this article is camphor oil, which under the proposed tariff will pay a duty of 20 per cent; paragraph 54 proposes for heliotropin the same rate, namely, 20 per cent-this is therefore not just. Fifty cents a pound equals about 35 per cent of the selling price, but as we would have to pay a duty of 20 per cent on the raw material, camphor oil, the same is not excessive. Terpineol. The present duty on this article is 25 per cent. We manufacture this product, but owing to the increased cost of production (the item of labor enters here largely) far more is imported than we manufacture. A reduction of the present tariff is therefore entirely unnecessary and would be most unjust to the manufacturers of this country, of whom we are one. BRIEF No. 5. Paragraph 76. Vanillin. Present Payne rate, 20 cents per ounce. Proposed rate, 10 cents per ounce. We respectfully request and urge that the present rate be allowed to remain: (1) The rate was reduced from 80 cents to 20 cents per ounce in the last tariff-which in itself is already a tremendous cut. (2) We use the following raw materials: Cloves, caustic potash, acetic anhydride, bichromate of potash, sulphuric acid, benzol. (A) Cloves: These have always been on the free list; it is now proposed to place a duty of 2 cents per pound, which is equal to about 20 per cent ad valorem. (B) In the case of caustic potash we have a similar condition. This article has always been free; is now to be taxed with an import duty of three-fifths cent per pound. (C) Acetic anhydride: The duty now is 2 cents per pound plus 30 per cent for the container and there is no change proposed. (D) Bichromate of potash is made here, and we use the domestic article exclusively. (E) Sulphuric acid costs us fully 50 to 60 per cent more than the price paid by our German competitors. (F) Benzol: The proposed tariff places a duty of 5 per cent on this product; this probably means the price will advance nearly proportionately. The above is a brief résumé of the situation of the point of view of the raw materials used by us. The increased cost of labor, the more expensive special machinery used, in fact every item of cost and expense is higher here than abroad. These facts all go to prove a reasonable tariff is absolutely necessary. You will note that the proposed bill reduces the present tariff by 50 per cent, and of the six principal raw materials usedit is proposed to take three off the free list-and on another, acetic anhydride, there is no decrease, but the present rate is allowed to remain unchanged. In view of the foregoing we respectfully request that no change be made in the present rate of 20 cents per ounce. BRIEF No. 6. The attention of the committee is respectfully called to the fact that a good many spices, etc., are used for two purposes in this country. First. As spices or condiments, and we can not discuss these uses and what effect a duty will have on the same. Second. Spices are also the raw materials for two very important industries now existing in the United States, the distillation of essential oils and the production of vanillin. The duties proposed in paragraph 41 equal about 20 per cent ad valorem and we claim, placing a burden of such high duties on the raw materials of two industries, is altogether out of proposition. If it is the intention of the committee to propose a tariff on spices used for food and spice purposes then some means should be devised whereby those used for manufacturing purposes can enter free of duty as before. They could perhaps be made unfit for human consumption is some way or the manufacturers could use and distill these raw materials under some suitable governmental control. We understand in France and Germany the latter method is used-evidently with some degree of success-otherwise the practice would not continue. It appears to us that the PARAGRAPH 3-OILS. framers of the new bill had in mind when the duties were proposed for spices that these articles are used solely as spices and condiments and may therefore be considered possibly as a luxury, but they evidently did not, at the same time, consider the fact that spices also form the basis of two important chemical industries. We respectfully request and urge that this feature of the matter is carefully considered and if the various duties proposed must remain on the spices used by the food and spice trade, then some means and method be introduced and decided upon, whereby spices, etc., imported and used for distilling and manufacturing purposes can come in free of duty. BRIEF OF THE COLUMBIA WESTERN MILLS IN RE OILS. WEST PULLMAN, CHICAGO, ILL., January 3, 1913. Mr. JAMES R. MANN, Washington, D. C. DEAR SIR: As you are probably aware a hearing is going to be given on January 6 at Washington, D. C., Ways and Means Committee presiding, on the Underwood Bill, on which there is a proposed duty of one-fourth cent per pound on soya bean oil and 5 cents per gallon on China wood oil. As you will probably remember, this matter was discussed during March, April, 1912, when the above bill passed the House of Repre sentatives. We can not see any reason why any amount of duty should be assessed on these oils, because the same are raw materials for paint and varnish industry of this country and both these oils are not crushed here. The assessment of any amount of duty on such raw materials will place the consumers in a very disadvantageous position in buying these materials in the future. Our object in writing you is to protest against such assessment of duty on these items, leaving them free as they now are. Attached we give you some information covering these two oils which is self-explanatory, and anything you can do to leave their entry free into this country without duty will be appreciated by us. Yours, very truly, COLUMBIA WESTERN MILLS, [Inclosure.] CHINA NUT OIL (CHINA WOOD oil). China wood oil is crushed from nut, which is a production of southern China, Hankow district being the center. This nut tree is only grown in southern China and not in any other place in the world. We heard that experimental plantation of this nut tree was made in this country, but such experiment was a total failure. We tried to import the nut instead of the oil, to be crushed in this country, but we were not successful. Every year, about the beginning of October, the nut is picked from the tree by natives in southern China and crushed to obtain the oil. Then it is sold to refineries around Hankow, by whom the oil is refined, and shipped to this country. Usually the new crop oil is shipped from China by the end of October or early November. It generally takes 90 days before the oil arrives in this country from China. PARAGRAPH 3-OILS. As long as the nut tree can not be raised in this country, we do not think that any industry for crushing of this nut can be established, especially if you take into consideration the fact that we were not successful even to import the nut for crushing purpose here. We are unable to obtain statistics for the production of nut in China, because there is no way of obtaining any figure, but we state below the quantity and value of importation of this oil into this country for the past few years: Soya bean oil is crushed from soya bean, which is a product of North Manchuria, China. This oil has been used by soap manufacturers in extensive quantities about three years ago, when cotton-seed oil, tallow, grease, and other soap materials were very high. We heard that experimental plantations were made in this country with soya bean in the past, but the result was not successful. There even might be a small quantity of soya bean raised in this country, but such quantity is used for cattle feeding, fertilizer, etc., and is not enough for crushing use to obtain oil. Therefore the only way to obtain soya bean oil is to import from foreign countries. The production of soya bean in North Manchuria averages around 1,000,000 tons of 2,240 pounds per year. About 40 per cent of this quantity is now exported to Japan, where it is used for aoy making, or feeding purpose, as well as for crushing use to make soya bean oil. About 20 per cent is consumed by China itself; about another 20 per cent is crushed in northern China, thereby obtaining oil and cake; about 5 per cent will be kept by farmers for sowing use for next season. The balance of about 15 per cent is for export to European crushers. In Europe soya bean is used for crusher purpose to obtain soya bean oil and soya oil cake. Soya bean has only been introduced to European crushers since 1909. Therefore it is still quite a new product to them. There is no industry in this country for crushing soya bean. Therefore the soya bean oil used by soap manufacturers has to be imported as above stated from foreign countries. Below are the statistics of import into this country. P. S.-Under present tariff there is a duty of 45 cents per bushel on soya bean which is a prohibitive rate. If there is a small number of farmers who are raising soya beans in this country they are well protected under the above prohibitive duty on soya beans. PARAGRAPH 3-OILS. STATEMENT OF M. B. SNEVILY, OF NEW YORK CITY. Mr. SNEVILY. If the committee please, a provision should be made in your tariff to cover vegetable oils and seeds met with elsewhere and which are now named under either the similitude clause or under the paragraph "Not otherwise specified," the result of which is that an inferior oil or a seed which we use to produce an oil to be used as a substitute for a staple, will pay in some cases the same duty and in other cases more duty than the staple itself. This fact prevents the use of substitutes, because it is well recognized in the trade that a buyer will never pay for a substitute the same price for which he can obtain a staple. The duties on vegetable oils and seeds, in my opinion, should be specific and not ad valorem for several reasons. One reason is that a specific duty will do away entirely with undervaluation. It will also absorb any difference in market values of the different markets of the world. Furthermore, in this country, where we import a seed we import it to obtain the oil. The value of that seed depends upon the percentage of oil which it contains and the quality of the oil that we can secure. Ad valorem duties increase the assessment on the consumer when the market advances. For example, take table olive oil, a fair quality of which was obtainable a year ago at 80 cents a gallon. I am not alluding to the class of oil that you would use yourself on your own table, but to a fair grade of wholesome oil. The duty on that oil in barrels is 40 cents a gallon, equivalent to 50 per cent, of course. To-day that same grade of oil will cost $1.20 a gallon. An equivalent of 50 per cent would make the duty 60 cents instead of 40 cents, and that 20 cents a gallon increase is paid by the consumer, not to the producer but to the Government. Mr. HARRISON. In that respect you are satisfied with our bill, because in all our seed laws the duties provided are specific. Mr. SNEVILY. If my recollections are correct, you provide in some 'places an ad valorem duty, not on olive oil, but on some of the seeds covered in the schedule. Mr. HARRISON. The seeds themselves or the oil? Mr. SNEVILY. The seeds and oils. Mr. HARRISON. They are in the agricultural schedule? Mr. SNEVILY. The seeds are in the agricultural schedule; yes, sir. Mr. HARRISON. We have not reached that yet. Mr. LONGWORTH. To what paragraph are you particularly referring? Mr. SNEVILY. I am not referring to any particular paragraph, but am on the general subject of vegetable oils and seeds." Fluctuations in these commodities are sometimes very violent. Prices have been steadily advancing for several years-in fact, are continuing to advance. As an illustration of what we have in the way of fluctuations, linseed oil sold a short time ago for 95 cents and is now being sold for 40 cents a gallon. Coconut oil, of which we have sold hundreds of tons at 4 cents a pound-and which I considered extremely high at 6 cents a pound-has sold during the past |