COMPETITIVE CONDITIONS IN SOUTH AMERICAN TRADE. 191
have had to pay higher prices for coffee than they would have otherwise
 paid.
THE QUEBRACHO COMBINATION.

““Quebracho” is a name applied to more than one species of wood
found in the subtropical forests of southern South America. The red
quebracho, belonging to the species Quebrachia Lorentzii, is found
chiefly in the northern part of Argentina and in part of Paraguay. This
species is probably the richest of all woods in tannin content. It is
principally used in making quebracho extract for tanning leather.
The demand for quebracho extract has led to a great development of
the industry in Argentina since 1901. In that year exports of solid
(crystallized) quebracho extract amounted to 4,310 metric’ tons, and
of quebracho logs, 198,919 tons. In 1913 the exports of extract were
79,684 tons and of logs 383,964 tons. The value of the exports
quadrupled during that period.
The United States is Argentina’s principal customer for quebracho
extract. Of nearly 80,000,000 pounds of extract imported into the
United States in 1913, about 94 per cent came direct from Argentina and
6 per centfrom Europe. The United States and England together took
about two-thirds of the quantity of extract exported from Argentina.
Exports of quebracho logs to the United States were relatively small,
The United Kingdom was the nominal destination of 74 per cent of the
log exports, Italy about 7 per cent, and Germany about 6 per cent.
As a matter of fact, practically all of the logs credited to the United
Kingdom were manufactured into quebracho extract in German and
Austrian factories. Neither quebracho extract nor logs entering the
United Kingdom are subject to any import duty, but while the import
duties on logs imported into continental nations, especially Germany
and Austria, are small, the duties on quebracho extract are very heavy.
As a result the English consumers preferred to import the solid extract
from Argentina instead of the logs, and the European manufacture of
the extract was practically limited to factories established on the
Continent.
The Forestal Land, Timber &amp; Railway Co., a British-owned company,
 is the dominant factor in the production of quebracho extract
in Argentina and in the export of quebracho logs. It owns about
5,000,000 acres of forest land, operates over 200 miles of railroad, and
has a fleet of river barges and tugs. The annual consumption of its
quebracho extract factories is estimated at about 300,000 metric tons
of wood, and it exports over 200,000 tons of its own logs. In addition
to the dominant position it has obtained in Argentina, which it reached
in large measure by buying out or consolidating with rival firms or by
contracting to handle all their output, as has been the case with the
Sociedad Anonima Quebrachales Fusionados and the Argentina
Timber &amp; Estates Co., it has had working arrangements with the