Business & Finance: Fruit Trouble

A shrewd and able executive is Victor M. Cutter, onetime timekeeper and now President of United Fruit Co. Most famed North-Central American enterprise, U. F. C. is the largest fruit shipper (97 steamships in the Great White Fleet), largest landowner (2,000,000 acres in Colombia, Costa Rica, Guatemala, Honduras, Panama, Canary Islands, Jamaica, Nicaragua, England, France, U. S.), largest U. S. banana importer (1928: 33,872,000 stems). Last year the Great White Fleet carried 72,000 passengers. On land, United Fruit Co. operates 2,300 miles of railway and tramway, owns herds of 30,000 cattle, 12,000 horses and mules, 1,200 “miscellaneous animals.”

Not the smallest tax upon President Cutter’s shrewdness has been the necessity, increasing year by year, of impressing upon sensitive Central Americans that the great U. F. C., industrially dominant, is also the personal and political friend of each and every Latin American republic. Accordingly, last January, he wrote and published Foreign Trade’s Golden Rule, explaining the essential economic unity of U. F. C. and the countries in which it operates. Accordingly, last week, he was vexed to find a rift in at least one of U. F. C.’s golden unities.

Costa Rica. Limón is the chief Costa Rican port on the Caribbean. And Port Limón is the creation of U. F. C. The docks are owned by U. F. C.; the railroad from the port to the capital (San Jose) is operated by U. F. C.; of the townspeople of Port Limón, 95% are employes of U. F. C. And only U. F. C. ships touch at Port Limón. Hence last week, when U. F. C. threatened to suspend trade with Costa Rica, Port Limón had reason to feel that life itself was being threatened.

Cause of United Fruit Co.’s drastic threats was Costa Rica’s new law placing a tax of 3% a bunch upon bananas, second only to coffee in Costa Rican economics. Angry, the U. F. C. declared it would be cheaper to open new plantations in other countries, showed its annoyance by stopping new planting in Costa Rica, refusing to renew contracts with independent growers. United Fruit Co. trade is essential to Costa Rica. Last year Costa Rica’s revenues came to $33,318,699, those of the fruit company to $20,606,393. Observers last week believed the law would be repealed.

Cuyamel. Last week, also Central Americans heard that United Fruit Co. already the most important single factor in their trade, might become an even greater, more potent unit. From New Orleans, chief banana port, came rumors that U. F. C. had bought the Cuyamel Fruit Co., second in the field, operating eleven ships, large landowners in Honduras and Nicaragua. Combined assets of the two companies would exceed $250,000,000. Independent still would be the Standard Fruit and Steamship Corp., founded and largely owned by the Brothers Vaccaro of New Orleans.