the sugar trust -- 7/24/23

Today's selection -- from Sugar: The World Corrupted by James Wavlin. Sugar was integral to the founding of America, became a central part of American diet, and reached a new plateau in the sugar trust, the gargantuan American Sugar Refining Company amalgamated in 1887 by Henry Havemeyer:

“Why and how did sugar (and, later, other sweeteners) intrude themselves into then drinks and foodstuffs of the West, and then of the wider world?

“Even in its early stages, the industrialisation of food drink in the late nineteenth century involved the widespread use of sugar. Sugar was used in the development of new types of flour, in the packaging and refrigeration of meats, and especially in the new canning and bottling systems of a wide range of fruits, vegetables and soups. Step by step, sugar found its way into an enormous range of foodstuffs delivered to people’s dining and kitchen tables. In the same period, the rise of cheap fizzy drinks - sodas - had an even more prominent role to play in the use of sugar.

“To understand how this happened, we need to look at the USA. Throughout the nineteenth century, the US economy and the people it served, consumed sugar on a gargantuan scale. That sugar was imported from the Caribbean and la! from Hawaii, while millions of tons were cultivated in the cane fields and sugar beet fields of the USA. On the eve of the Civil War, the US imported 694 million pounds of sugar. Twenty years later, that had risen to 1,830 million pounds. In 1900, sugar imports stood at 4,007 million pounds, only to double again by the mid-1920s While the US was not alone in love of sugar, its economy was hugely influential in shaping and influencing others around the world, and the story of what happened to sugar in the USA foreshadowed many of global trends of the twentieth century. Today, key areas of world food and drink are dominated by major US corporations and, if we want to understand the global patterns of sugar consumption, we need to look closer at what happened in the USA.

“Earlier, in Chapter 6, we examined the story of coffee-drinking in the USA, and the American love of sweetened coffee that became, and has remained, a national obsession. But sugar itself had a far wider importance in the USA than simply being an additive to coffee. Sugar became an issue in US federal economic policy, with tariffs imposed on imported refined sugar in order to protect the US sugar refining industry and, of course, to generate income for the Government. Although the first tariffs were in place in the early days of the Republic, protection for the sugar industry only came fully into force in 1842. Fifty years later, when the McKinley Act (1890) changed the tariffs on sugar, sugar prices fell, and sugar consumption increased even further.

Sugar cane plantation

“Until the 1880s, US sugar had been characterised by a multitude of sugar companies, with their refineries dotting the port 'ties of the east coast. The modernisation of the industry in the 1880s was prompted by major investments in new refining facilities and by the emergence of major refining companies led by the flamboyant entrepreneur Henry Havemeyer. He had been born into a family sugar business, was trained and raised sugar, and was to prove both an astonishing businessman and the driving force behind the transformation of the American sugar industry. In 1887, Havemeyer amalgamated seventeen of America's twenty-three refineries to create the American Sugar Refining Company- which controlled 98 per cent of the industry. It took the form of a trust - the Sugar Trust - mirroring Rockefeller's more famous Standard Oil Trust. Like other trusts, Havemayer's version revolutionised the sugar industry and, by 1891, there were only four of the original refineries in operation.
“These were the years of the formation of major corporate conglomerates - the rise of Americans trusts - in a string industries: banking, tobacco, finance, oil and steel. These trusts were so massive and powerful that they effectively operate stranglehold - in some cases, a monopoly - over their indus But they prompted a fierce political and legal reaction, a conflict between the major industrial trusts (keen to press home their domination and to resist the legal and political restraints placed on them) and politicians anxious to defend the consumers’ interests. And it was a long-running story, a part of the 'momentous organisational convulsion' that transformed the American economy between 1895 and 1907. It was an era of major takeovers - the yearly average was 266 - and the end result normally a single company dominating its chosen market. Sometimes, a single corporation might control 60 per cent of the market. By 1904, an estimated 318 corporations owned 40 per cent of all US manufacturing assets.

“The Sugar Trust, formed in 1887, only five years after Rockefeller's initiative in oil, was reformed in 1891 as American Sugar Refining Company. It consolidated the major sugar refiners of the USA, and became the central agent for the manufacture of American sugar, owning most of the nation’s best-known brands, and was responsible for negotiations with state and regional governments. Havemayer's company, with various subsequent legal names, became the main organisation for the manufacture of American sugar, and concentrated on promoting highly refined, white, granulated sugar. It also did no harm, from Havemayer's point of view, to set out to undermine other sorts of sugar, notably brown sugar, in the process. Throughout, it developed complex but persuasive dealings with government.

“As with other major trusts, it, too, had serious conflicts in the law courts and with government. But its power, and its money, enabled this new brand of American 'King Sugar' to
deflect or win over political and legal opposition and to advance e broader interests of the sugar industry. Although sugar is rarely lumped together with railroads, steel and petroleum, its cartel arrangements followed a very similar path - and with similar consequences for the way the industry was run. It was also a vivid illustration of the importance of sugar in the
economic and social life of the USA at the dawn of the twentieth century.

“This corporate story of American sugar, and its growth in the last years of the nineteenth century into a major national industry, was also a striking reflection of America's deep attachment to sweetness. The sugar lobby and industry were important because sugar was an integral feature of American life. Sugar as everywhere - from medicine to home cooking, from
commercial drinks to elaborate dining at family and formal occasions. Many of these sugary tastes emerged as powerful commercial entities from older, simpler and more functional items. The sweetening of bitter medicines, for example, led to the emergence of sugary candies (sweets). American candy bars were little more than boiled sugar.

“By the early twentieth century, sugar, a long-time presence inside the home as an additive to drinks, became a staple in kitchens and cupboards as a vital ingredient in home cooking, baking and preserving fruits and foodstuffs. Sugar was equally important in the massive expansion of commercial baking and confectionery.”



James Wavlin


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