FOREIGN TRADE: Tung Oil Wanted

Shy, determined Chinese financier K.P. Chen stuck a feather in his cap last week. From Chungking he wired Manhattan’s Universal Trading Corp. to pay the final installment on a $22,000,000 Export-Import Bank loan smack on the tung-oil barrel head—nearly two years before the last installment on the loan was due.

Thus had he fulfilled his assurance to U.S. Treasury officials that China could do business even when the Japs controlled its coast. When he borrowed the money in 1938, no political loans were possible. Democracy was not then counted a good security in Washington; but tung oil—essential in high-grade paints and varnishes—would do. So Chen founded Universal Trading Corp. in Manhattan to manage tung-oil sales, earmarking one-half the proceeds to pay the debt. He then organized Foo Shing Trading Corp. in China to gather and ship the oil, went home to direct it.

Scottish-American Archie Lochhead, former manager of the Treasury’s two-billion-dollar stabilization fund, made every bucketful count for China. As head of Universal, he got good prices (current price, 38¢ a lb.), bought a thousand motor trucks and countless other items for China, dismantled and shipped whole factories across the Pacific, spent $60,000,000 on American goods. The Corporation sold about 150,000,000 lb. of tung oil.

From innermost China the oil came, in bamboo-&-paper buckets, wooden tubs, in second-hand steel oil drums. After the eastern ports were lost, the oil moved down the Burma Road, under constant bombardment. The last consignments shoved off from Rangoon under a shower of bombs, shortly before the advancing Japanese captured the city in March— leaving the U.S. hereafter to fend for tung itself.

U.S. annual consumption is well over 100,000,000 lb. and there are no substitutes for it, not even soybean, castor or other oils, however processed. The versatile tung provides the fastest vegetable oil paint and varnish dryer. It gives to paints a tough, elastic, heat-resisting surface. It waterproofs paints and varnishes, printing inks, electrical insulation, brakebands, linoleum. It resists acids and is therefore a good interior coating for citrus fruit cans. So important is the oil that it is deliverable in the trade only on A-2 priority orders.

Along the Gulf Coast, from Florida into Texas, are nearly 200,000 scattered acres of tung plantations, out of 750,000 acres believed to be suitable for the culture. But the tung tree is hard to raise in U.S. soil and climate. It needs a minimum of five, a maximum of 15 days of freezing weather; virgin, acid soil; good drainage and a hillside location. It should have at least 40 inches of well-distributed rainfall each year.

When new groves already planted begin bearing a commercial crop after five years, U.S. tung-oil production will be about 10,000,000 lb. A third of U.S. requirements might be satisfied—in time—if the remaining 500,000 odd suitable acres were successfully planted. This year’s crush will produce some 8,000,000 lb., about 5% of what the U.S. needs. For the long pull the Department of Agriculture hopes to develop hardier tung trees (to widen the potential U.S. area for tung plantations) and trees that yield more oil per unit.