usual amount of buying. About 100,000 tons more than was usually bought in Europe in one season was bought at that time, and this additional rather sudden demand doubtless accounts for most of that increase in price.

Again, in the latter part of 1904 and the early part of 1905 there is a large increase in the price. It will be noted that at the beginning of this increase the margin fell, showing that it was not possible to put up the price of refined sugar quite so rapidly as the price of the raw increased; although when the fall in the price of raw sugar came, in 1905, it was possible to check the fall in refined, so that the margin increased for a brief time to about 1 cents a pound.

The cause of that increase was a short beet crop in Europe. There was a falling off of more than 1,000,000 tons in our imports, as compared with the regular import, and this short beet crop in itself is sufficient to account for the increase in price. Again, in 1908 the increased price came from a drought in Cuba, which resulted in a short crop in the Cuban cane sugar. It will be noted that during the years 1907, 1908, 1909, and 1910, the margin was on the whole less than before, so that there can be none of the increased cost of living during the last few years ascribed to the influence of the sugar combination.

Likewise, the decided sudden increase in prices in 1911 was due to a drought in Germany which lessened the beet sugar crop by some 2,000,000 tons. This decided increase in price seemed to have very little if any effect upon the margin. There had been a slight increase in the margin shortly before the large increase

in prices. This continued through the period of high prices. It was fully justified by the increased price of the raw sugar, which on account of the waste in refining justified a larger margin.

A study of the chart, especially when we compare the American with the German margin, seems to show clearly that the sugar combination at the height of its power had the power of determining for itself within considerable limits what the price of sugar should be, low or high, with or without competitors; although during two or three periods when there was the most vigorous competition it chose to cut prices in order to enable it to buy out its rivals rather than run the risk of letting them gradually take its market on account of its high prices. At the time of the Spreckles competition this policy was directly successful, and the combination succeeded in buying up its competitors and then again raising its margin so that it could make enormous profits.

On the other hand, the same policy followed in 1898, at the time of the Arbuckle-Doscher competition, did not have directly the same result. It seems evident enough that, even though its rivals may not have sold out to the combination, there was more or less of an understanding that the competition should be checked. The price was regularly announced every day by the American Sugar Refining Company, and the prices as announced by that company were understood to be the regular market prices followed by all of the refiners. From the time of the organization of the Trust, in 1887, for twelve or thirteen years the Trust kept the margin high for more than three-quarters of the time. Since

that period the margin, it will be noted, has steadily remained considerably higher than during the period of most vigorous competition in the few years preceding the organization of the Trust, and during the two periods of vigorous competition since that time.

It will be noted that line F, representing the margin between the prices of refined and raw sugar in Great Britain in the earlier part of the year 1901, suddenly increases from somewhat less than a cent a pound to almost or quite two cents a pound, that it continues at about this price until 1908 when it drops to a little more than a cent and one-half, continuing at that price until the sudden changes caused by the European war. Before this sudden rise, the margin had been in Great Britain much the same as in the United States with the various modifications in the United States already discussed.

This change in the English margin in 1901 was caused by an excise tax with an equal import duty of from 1s 10d per hundredweight on low grade raw sugar to 4s 2d on refined sugar. The refiners being compelled to pay this tax naturally added it to the price. The lowering of the margin in 1909 was caused by the reduction of the excise tax to 1s 4d for the maximum. This furnishes another excellent illustration of the way in which various economic influences are brought out on the charts.

The outbreak of the European war, of course, completely demoralized the market and since its beginning prices, both here and abroad, have been determined by war conditions in such a way that they afford no criterion for judgment regarding conditions in times of

peace. In Germany since the outbreak of the war, the sugar has been controlled by the Government entirely as regards both output and consumption. The shipments either way being completely cut off, there has been no information given out, so that nothing trustworthy is known here regarding the German market since August, 1914.

France and Italy have placed the management of both the purchase and distribution of their sugar, raw and refined, in the hands of the English Royal Commission. Through its monopoly of purchases of the three countries named and its control of ships, England has influenced profoundly conditions in this country as well as elsewhere. Under ordinary conditions, the United States imports the raw material for three-fourths of the sugar that it refines. One-half of its supply comes from foreign sources. At the present time (February, 1917), speaking roundly, two-thirds of the sugar supply districts of Europe are in the war territory, a territory which before the war had supplied practically one-half of the world's supply. When, therefore, we consider that the war has cut off from the world market one-third of the world's production, we see the reason why Great Britain acting for herself and her allies has been compelled to import from Cuba large quantities, more than 730,000 tons in 1916. This has, of course, greatly restricted the United States buying market for raw sugar. Before the war the United Kingdom imported large quantities from Germany. During 1916 the United States exported to Europe more than 700,000 tons of refined sugar, part of the output from the raw sugar imported by us from Cuba, amounting to more than two million tons.