[96 REPORT ON COOPERATION IN AMERICAN EXPORT TRADE,

productive capacity of the member. All iodine produced must be
consigned to the agent of the combination, which thus far has been
the firm of Antony Gibbs &amp; Co. Any member who sells iodine
outside the combination must indemnify the other associates at the
rate of £50 for each quintal sold. All sales must be made through
the consignee agent.
The combination is considered to have been very successful in
controlling the world’s trade in iodine and in maintaining prices
which left large margins of profit for its members.
How far the combination is international in character and has
agreements with producers of iodine outside of Chile could not be
ascertained. As stated in article No. 4 of its constitution, one of
the objects of the association is to reach an agreement with the
producers of iodine in other countries, so as to furnish all the iodine
that may be needed for consumption. Clauses I and J of article No.
18 specifically refer to arrangements existing with the European
producers of iodine at the time the combination was formed. (See
Pt. II, p. 501.)
At the office of Antony Gibbs &amp; Co., in Valparaiso, all information
relating to the operations of the Iodine Combination was refused,
further than the statement that the combination was still active
and was conducted in accordance with the agreements set forth
in its constitution. From other persons well acquainted with the
nitrate and the iodine situation considerable information was obtained
hearing on the power of the combination and its practical effects.
Through the limitation of production enforced on the members, only
» small part of the iodine which could be made is allowed to be manutactured.
 The rest is lost by allowing the surplus “mother liquor”
bo go to waste. The price varies from time to time, but it is usually
from three to four times the cost of placing the iodine on the market.
The demand for iodine is not subject to much fluctuation. The
price at which it is sold bears no relation to the cost of production in
Chile, but is fixed by the combination at the point of maximum
-eturns, i. e., as high as the demand will permit.
[t might be expected that owners of nitrate properties capable of
producing iodine, and dissatisfied with the quota allowed them, would
seek to take advantage of the high prices thus established. There is
aothing in the laws of Chile to prevent such an attempt. But in all
the years of its existence few efforts have been made to manufacture
iodine outside of the combination. and no such attempt has been
successful.
There was a unanimity of opinion among all the informants as to
the cause of the combination’s power. It lies in the conn ction of
the nitrate industry with the general prosperity of Chile, That indus-