Panama to Patagonia

by Charles M. Pepper

No statistics are available which show the commerce of the western departments of Colombia; and the unsettled state of that country for years past gives no index of what its potential traffic may be. But the valley of Cauca in its variety of agricultural and mineral resources is a kingdom in itself. It is a future commercial feeder to the Canal.

The foreign trade of Ecuador amounted in the latest available year to $19,000,000.[2] Substantially all of it constitutes what might be called light freight, and a part of it now goes across the Isthmus by transshipment. Yet the portion which follows the longer route around Cape Horn or through the Straits is not small. The traffic flows through Guayaquil as in a single stream. Guayaquil, by way of Panama, is 2,864 miles from New York and 2,263 miles from New Orleans; by the Cape Horn route it is 11,470 miles to New York. The entire foreign commerce of Ecuador in the future is for the Panama Canal, except the excess which follows up the coast to San Francisco and beyond.

2 Statistics obtained by New York Chamber of Commerce for 1904.

The foreign commerce of Peru may be placed above $40,000,000 annually.[3] The bulk of the traffic is now via the Straits of Magellan and Cape Horn. From Callao to New York, by way of Cape Horn, is 10,700 miles. By way of Panama it is 3,600 miles, only a little longer than from New York to San Francisco or from New York to Mexico City by the transcontinental railroad lines. In reference to Peru, it also is to be noted that the heaviest exports are from the ports north of Callao. Sugar is the largest marine freight in quantity, and this comes from Salaverry and other ports fully 500 miles north. Much of this raw sugar is now carried around Cape Horn, though some of it is left at the Chilean ports to be refined for the West Coast consumption. When the Canal is opened, with the exception of this Chilean traffic, all the raw sugar of Peru will be shipped through it to New Orleans, New York, or Liverpool.

3 Estimated on the basis of the calendar year 1904, when the total was $41,000,000, according to the report of the British Consul General.

Through the port of Mollendo, 360 miles south of Callao, come the ores, the metals, and the wools, both of southern Peru and of Bolivia. Some of the minerals may continue their course around the Horn, and also the guano which Peru in the future may export, but not all of these cargoes will find the longer route cheaper. All the wools will take the shorter route. Some wool is sent up the coast and transshipped across the Isthmus by the railways. This method is also followed in the shipment to Liverpool of some of the raw cotton raised in southern Peru. The whole of this light freight is traffic for the interoceanic waterway.

Bolivian commerce finds its outlet and inlet, chiefly through Chilean and Peruvian seaports, to the amount of $18,000,000 a year. Small as this is, the bulk of it follows the Cape Horn and Magellan routes, though some of the European merchandise is imported on the Atlantic slope through Argentina. The silver and copper ores are transported principally through the port of Antofagasta, which is 650 miles north of Valparaiso. For the mineral freights, Canal tolls may neutralize the advantage of the shortened distance via Panama to Liverpool, or may not compensate for the lessened coal consumption. But whether they do or not, the general merchandise from England and from Germany, not being bulky, will have the shorter course and probably the cheaper one on the return voyage through the Canal.

But Antofagasta, though of growing importance, is not likely to be indefinitely the chief port of export for Bolivia. The building of a railway from the great central plateau to Arica makes it certain that the copper output of Bolivia, much of the tin, and part of the silver product in time will be shipped through that port, while it will be a natural inlet for imported merchandise. Arica is so close to Mollendo—only 233 miles—that with regard to distances it may be considered on the same basis. The mineral and other internal developments, which are to fix the industrial status of Bolivia and which I shall have occasion to discuss in subsequent chapters, have a very direct relation to the facilities that will be afforded by the isthmian waterway.

Formerly it was thought that Chile would be seriously harmed by the Panama Canal. In the commercial sense this supposition does not bear scrutiny. Chile’s foreign trade is approximately $130,000,000 annually, with a tendency to reach $150,000,000. By far the heaviest proportion of this commerce is the shipments of the nitrates of soda or saltpetre fertilizers. Iquique is the principal shipping-point. The sailing-ships are the cheapest carriers for these bulky cargoes, and tolls based on tonnage may make it unprofitable to transport a large portion of them through the interoceanic channel. There is also the other consideration that the vessels which bring coal to the Chilean ports from Australia and from Newcastle secure their return cargoes of nitrates. These fertilizers being a natural monopoly, Chile will have the benefit of the industry, and the Panama Canal in no way can lessen this traffic. In its permanent effect the waterway can have little influence on the nitrates, because the deposits will be worked out not many years after its completion. Within a third of a century, or forty years at the furthest, the exhaustion of the saltpetre beds will have begun, and the cargoes of fertilizers will be lessening before that time.[4] In any aspect of the broad future of the Canal and its effect on the West Coast, the nitrates of Chile need not be considered as an influencing factor.

4 See [Chapter XIV], Nitrate of Soda.