Chapter XXXI: Some Big Men and Notable Achievements (1)

_B.G. Arnold, the first, and Hermann Sielcken, the last of the
American "coffee kings"--John Arbuckle, the original package-coffee
man--Jabez Burns, the man who revolutionized the roasted coffee
business by his contributions as inventor, manufacturer, and
writer--Coffee-trade booms and panics--Brazil's first valorization
enterprise--War-time government control of coffee--The story of
soluble coffee_

In the history of the coffee trade of the United States, several names stand out because of sensational accomplishments, and because of notable contributions made to the development of the industry. In green coffee, we have B.G. Arnold, the first, and Hermann Sielcken the last, of the "coffee kings"; in the roasting business, there was John Arbuckle, the original national-package-coffee man; and in the coffee-roasting machinery business, Jabez Burns, inventor, manufacturer, and writer.

_The First "Coffee King"_

Benjamin Green Arnold came to New York from Rhode Island in 1836 and took a job as accountant with an east-side grocer. He was thrifty, industrious, and kept his own counsel. He was a born financial leader. Fifteen years later he was made a junior partner in the firm. By 1868, the bookkeeper of 1836 was the head of the business, with a line of credit amounting to half a million dollars--a notable achievement in those days.

Mr. Arnold embarked upon his big speculation in coffee in 1869. For ten years he maintained his mastery of the market, and in that time amassed a fortune. It is related that one year's operations of this daring trader yielded his firm a profit of a million and a quarter of dollars.

B.G. Arnold was the first president of the New York Coffee Exchange. He was one of the founders of the Down Town Association in 1878. The president of the United States was his friend, and a guest at his luxurious home. But the high-price levels to which Arnold had forced the coffee market started a coffee-planting fever in the countries of production. Almost before he knew it, there was an overproduction that swamped the market and forced down prices with so amazing rapidity that panic seized upon the traders. Few that were caught in that memorable coffee maelstrom survived financially.

Arnold himself was a victim, but such was the man's character that his failure was regarded by many as a public misfortune. Some men differed with him as to the wisdom of promoting a coffee corner, and protested that it was against public policy; but Arnold's personal integrity was never questioned, and his mercantile ability and honorable business dealings won for him an affectionate regard that continued after his fortune had been swept away.

After the collapse of the coffee corner, Mr. Arnold resumed business with his son, F.B. Arnold. He died in New York, December 10, 1894, in his eighty-second year. The son died in Rome in 1906. The business which the father founded, however, continues today as Arnold, Dorr & Co., one of the most honored and respected names in Front Street.

_Hermann Sielcken, the Last Coffee King_

If B.G. Arnold was first coffee king, Hermann Sielcken was last, for it is unlikely that ever again, in the United States, will it be possible for one man to achieve so absolute a dictatorship of the green coffee business.

There never was a coffee romance like that of Hermann Sielcken's. Coming to America a poor boy in 1869, forty-five years later, he left it many times a millionaire. For a time, he ruled the coffee markets of the world with a kind of autocracy such as the trade had never seen before and probably will not see again. And when, just before the outbreak of the World War, he returned to Germany for the annual visit to his Baden-Baden estate, from which he was destined never again to sally forth to deeds of financial prowess, his subsequent involuntary retirement found him a huge commercial success, where B.G. Arnold was a colossal failure. It was the World War and a lingering illness that, at the end, stopped Hermann Sielcken. But, though he had to admit himself bested by the fortunes of war, he was still undefeated in the world of commerce. He died in his native Germany in 1917, the most commanding, and the most cordially disliked, figure ever produced by the coffee trade.

Hermann Sielcken was born in Hamburg in 1847, and so was seventy years old when he died at Baden-Baden, October 8, 1917. He was the son of a small baker in Hamburg; and before he was twenty-one, he went to Costa Rica to work for a German firm there. He did not like Costa Rica, and within a year he went to San Francisco, where, with a knowledge of English already acquired, he got a job as a shipping clerk. This was in 1869. A wool concern engaged him as buyer, and for about six years he covered the territory between the Rockies and the Pacific, buying wool. On one of these trips he was in a stage-coach wreck in Oregon and nearly lost his life. He received injuries affecting his back from which he never fully recovered, and which caused the stooped posture which marked his carriage through life thereafter. When he recovered, he came to New York seeking employment, and obtained a clerical position with L. Strauss & Sons, importers of crockery and glassware. In 1880, married Josephine Chabert, whose father kept a restaurant in Park Place.

Sielcken had learned Spanish in Costa Rica, and this knowledge aided him to a place with W.H. Crossman & Bro. (W.H. and George W. Crossman) merchandise commission merchants in Broad Street. He was sent to South America to solicit consignments for the Crossmans, and was surprisingly successful. For six or eight months every South American mail brought orders to the house. Then, as the story goes, his reports suddenly ceased. Weeks and months passed, and the firm heard nothing from him.

The Crossmans speculated concerning his fate. It was thought he might have caught a fever and died. It was almost impossible to trace him; at the same time it distressed them to lose so promising a representative. Giving up all hope of hearing from him again, they began to look around for some one to take his place. Then, one morning, he walked into the office and said, "How do you do?" just as if he had left them only the evening before. The members of the firm questioned him eagerly. He answered some of their questions; but most of them he did not. Then he laid a package on the table.

"Gentlemen", he said, "I have given a large amount of business to you, far more than you expected, as the result of my trip. I have a lot more business which I can give to you. It's all in black and white in the papers in this package. I think any person who has worked as hard as I have, and so well, deserves a partnership in this firm. If you want these orders, you may have them. They represent a big profit to you. Good work deserves proper reward. Look these papers over, and then tell me if you want me to continue with you as a member of this firm."

After the Crossmans had looked those papers over they had no doubt of the advisability of taking Sielcken into partnership. He was admitted as a junior in 1881-82 and became a full partner in 1885. For more than twenty years Hermann Sielcken was the human dynamo that pushed the firm forward into a place of world prominence. He was the best informed man on coffee in two continents; and when, in 1904, the firm name was changed to Crossman & Sielcken--W.H. Crossman having died ten years before--he was well prepared to assert his rights as king of the trade. He proved his kingship by his masterful handling of valorization three years later.

Sielcken was many times credited with working "corners" in coffee; but he would never admit that a corner was possible in anything that came out of the ground; and to the end, he was insistent in his denials of ever having cornered coffee. As a daring trader, he won his spurs in a sensational tilt with the Arbuckles in the bull campaign of 1887. Because of this, he became one of the most feared and hated men in the Coffee Exchange. For a while, coffee did not offer enough play for his tremendous energy and ambition. He embarked in various enterprises--among them, the steel industry and railroads. No one was too big for Sielcken to cross lances with. He bested John W. Gates in a titanic fight, in American Steel and Wire. He quarreled with E.H. Harriman and George J. Gould over the possession of the Kansas City, Pittsburgh, and Gulf Railroad, now known as the Kansas City Southern, and, backed by a syndicate of Hollanders, obtained control.

While still busy with the Kansas City Southern enterprise Sielcken began work on the coffee valorization scheme that he carried to a successful conclusion in spite of the law of supply and demand and the interference of the Congress of the United States. Valorization by the São Paulo government, and by coffee merchants, having proved a failure; Sielcken showed how it could be done with all the American coffee merchants eliminated--except himself. In this way, he secured for himself the opportunity he had long been seeking--the chance to bestride the coffee trade like a colossus. The story is told farther along in this chapter.

When his partner, George W. Crossman, died in 1913, it was discovered that the two men had a remarkable contract. Each had made a will giving one million dollars to the other. Then Sielcken bought his late partner's interest in the firm for $5,166,991.

His first wife having died at Mariahalden, his home in Baden-Baden, seven years before, Sielcken married at Tessin, Germany, in 1913, Mrs. Clara Wendroth, a widow with two children, and the daughter of the late Paul Isenberg, a wealthy sugar planter of the Hawaiian Islands. At that time the coffee king was dividing his time between the Waldorf-Astoria, New York, which he called his American home, and his wonderful estate in the fatherland. This latter was a two-hundred-acre private park containing four villas and a marvelous bath-house for guests besides the main villa; a rose-garden in which were cultivated one hundred sixty-eight varieties on some twenty thousand bushes; a special greenhouse for orchids; and landscaped grounds calling for the service of six professional gardeners and forty assistants. Here he delighted to entertain his friends. Frequently, there were fifteen to twenty of them for dinner on the garden terrace; and, as the moon came up through the tall hemlocks and shone through the majestic pines brought from Oregon, a full military band from Heidelberg, adown the hillside among the rose trees, mingled its music with the dinner discussions. There was nothing at that dinner table but peace and harmony, although every language in Europe was spoken; for Sielcken knew them all from his youth. Sometimes he entertained his guests with stories of his California life, and sometimes with those of shipwrecks in South America.

All the post-telegraph boys in Baden knew every foot of the sharply winding road up the Yburg Strasse to Villa Mariahalden; and the guests therein have counted more than eighty cables received, and more than thirty sent in a single day. And those daily cable messages were to and from all quarters of the globe, and to and from the master, who handled them all, without even a secretary or typewriter. Nowhere in the entire establishment was there even an appearance of business, except as the messages came and went on the highway. Sielcken manifested his greatest delight in showing his friends his orchids, his roses, his pigeons, his trout, and his trees.

Like Napoleon, this merchant prince required only five hours sleep. It was his custom to go to bed at one and to be up at six. Did he wish to know anything that the cables did not bring him, he jumped into his eighty-horse-power Mercedes with a party of guests and was off with the sunrise, down the Rhine Valley, on his way to Paris or Hamburg; and before one realized that he was gone, he was back again.

In 1913, Sielcken admitted to partnership in his firm two employees of long service, John S. Sorenson and Thorlief S.B. Nielsen. He went to Germany in 1914, shortly before the beginning of the World War, and remained at Mariahalden until he died in 1917. Sielcken never would believe that war was possible until it had actually started. Up to the last moment in July, 1914, he was cabling his New York partner that there would probably be no hostilities. He lost a bet of a thousand pounds made with a visiting Brazilian friend a few days before war was declared. The guest believed war inevitable and won. A few days before Sielcken's death the old firm was dissolved under the Trading with the Enemy Act, being succeeded by the firm of Sorenson & Nielsen. The former had been with the business thirty-four years, and the latter thirty-two years. The alien property custodian took over Sielcken's interest for the duration of the war.

Rumors in 1915 that the German government was extorting large sums of money from Sielcken brought denials from his associates here. After the war, it was confirmed that no such extortions took place.

Sielcken always claimed American citizenship. There was a widely circulated story, never proved, that he tore up his citizenship papers in 1912 when the United States government began its suit to force the sale of coffee stocks held here under the valorization agreement. The Supreme Court of California in 1921 decided that he _was_ a citizen, and his interests and those of his widow, amounting to $4,000,000, held by the alien property custodian, were thereupon released to his heirs. It appeared in evidence that he took out his citizenship papers in San Francisco in 1873-74, but lost them in a shipwreck off the coast of Brazil in 1876. The San Francisco fire destroyed the other records; but under act of legislature re-establishing them, the citizenship claim was declared valid.

Hermann Sielcken never liked the title of "coffee king." He was once asked about this appellation, and turned smartly upon the interviewer.

"Nonsense," he said. "I am no king. I don't like the term, because I never heard of a 'king' who did not fail."

Sielcken had no use for titles. T.S.B. Nielsen says that at a dinner party in Germany in 1915 he heard Sielcken explain to a large number of guests that the United States was the best country because there a man was appraised at his real value. What he did, and how he lived, counted--not birth or titles.

While his greatest achievement was, of course, the valorization enterprise, he played a not unimportant rôle in the Havemeyer-Arbuckle sugar-trust fight. He aided the late Henry O. Havemeyer to secure control of the Woolson Spice Co. of Toledo in 1896, so as to enable the Havemeyer's to retaliate with Lion brand coffee for the Arbuckles' entrance into the sugar business. The Woolson Spice Co. sold the Lion brand in the middle west, and the American Coffee Co. sold it in the east. That was the beginning of a losing price-war that lasted ten years. At the end, Sielcken took over the Woolson property at a price considerably lower than originally paid for it. In 1919, the Woolson Spice Co. brought suit against the Sielcken estate, alleging a loss of $932,000 on valorization coffee sold to it by Sielcken just after the federal government began its suit in 1912 to break up the valorization pool in the United States. The Woolson Spice Co. paid the "market price", as did the rest of the buyers of valorization coffee; but it was charged that Sielcken, as managing partner of Crossman & Sielcken, sold the coffee to the Woolson Spice Co., of which he was president, "at artificially enhanced prices and in quantities far in excess of its legitimate needs, concealing his knowledge that before the plaintiff could use the coffee, the price would decline." Sielcken collected for the coffee sold $3,218,666.

When the United States government crossed lances with Sielcken in 1912 over the valorization scheme, it looked for a time as if he would be unhorsed. But men and governments were all the same to Sielcken; and at the end of the fight it was discovered that not only was he undefeated--for the government never pressed its suit to conclusion--but that his prestige as king and master mind of the coffee trade had gained immeasurably by the adventure.

Hermann Sielcken typified German efficiency raised to the nth power. He was a colossus of commerce with the military alertness of a Bismarck. His mental processes were profound, and his vision was far-reaching. He was a resourceful trader, an austere friend, a shrewd and uncompromising foe. Physically, he was a big man with a bull neck and black, piercing eyes. His policy in coffee was one of blood and iron. He brooked no interference with his plans, and he was ruthless in his methods of dealing with men and governments. Usually silent and uncommunicative, occasionally he exploded under stress; and when he did so, there was no mincing of words. He knew no fear. Newspaper criticism annoyed him but little; and he had a kind of contempt for the fourth estate as a whole, although he knew how to use it when it suited his purpose. He avoided the limelight, and never courted publicity for himself. Socially he was a princely host; but few knew him intimately, except perhaps in his native Germany.

Sielcken's widow was married in New York, February 11, 1922, to Joseph M. Schwartz, the Russian baritone of the Chicago Opera Company.

_The Story of John Arbuckle_

John Arbuckle, for nearly fifty years the honored dean of the American coffee trade, pioneer package-coffee man, some time coffee king, sugar merchant, philanthropist, and typical American, came from fine, rugged Scotch stock. He was the son of a well-to-do Scottish woolen-mill owner in Allegheny, Pa., where he was born, July 11, 1839. He often said he was raised on skim milk. He received a common school education in Pittsburgh and Allegheny. He and Henry Phipps, the coke and steel head, are said to have occupied adjoining desks in one of the public schools, Andrew Carnegie being at that time in another grade of the same school. He had a strong bent for science and machinery; and, although he chose the coffee instead of the steel business for his career, the basis of his success was invention. He also attended Washington and Jefferson College at Washington, Pennsylvania.[348]

The Arbuckle business was founded at Pittsburg, in 1859, when Charles Arbuckle, his uncle Duncan McDonald, and their friend William Roseburg, organized the wholesale grocery firm of McDonald & Arbuckle. One year later John Arbuckle, the younger brother of Charles Arbuckle, was admitted to the firm, and the firm name was changed to McDonald & Arbuckles. McDonald and Roseburg retired from the firm a few years later, leaving the business in the hands of the two youthful, hopeful, and energetic brothers, who under the firm name of Arbuckles & Co., soon made their firm one of the important wholesale grocery houses in Pennsylvania. Although little thinking at the time that their greatest success was to be achieved in coffee, and that a new idea of one of the partners--that of marketing roasted coffee in original packages--would make their name familiar in every hamlet in the country, yet the first two entries in the original day-book of McDonald & Arbuckles record purchases of coffee.

Prior to the sixties, coffee was not generally sold roasted or ground, ready for the coffee pot. Except in the big cities, most housewives bought their coffee green, and roasted it in their kitchen stoves as needed. John Arbuckle, having become impressed with the wasteful methods and unsatisfactory results of this kitchen roasting, had already begun his studies of roasting and packaging problems, studies that he never gave up. How, first to roast coffee scientifically, and then to preserve its freshness in the interval between the roaster and the coffee pot, continued to be an absorbing study until his death. The range of his work may be illustrated by reference to his first and his last patents. In 1868, he patented a process of glazing coffee, which had for its object the preservation of the flavor and aroma of coffee by sealing the pores of the coffee bean. Thirty-five years later, he patented a huge coffee roaster in which, more closely than in any other roaster, he felt he could approach his ideal of roasting coffee--that ideal being to hold the coffee beans in suspension in superheated air during the entire roasting process, and not to allow them to come in contact with a heated iron surface.

By 1865, John Arbuckle had satisfied himself that a carefully roasted coffee, packed while still warm in small individual containers, would measurably overcome the objections to selling loose coffee in a roasted state. So in that year (1865), although not without the misgivings of his elder brother, and even in the face of the ridicule of competitors, who derided the plan of selling roasted coffee "in little paper bags like peanuts", Arbuckles & Co. introduced the new idea, namely, roasted coffee in original packages. The story of the development of that simple idea, which soon spread from coast to coast, and of how it laid the foundations of a great fortune, is one of the romances of American business.

Although Osborn's Celebrated Prepared Java Coffee, a ground-coffee package, first put on the New York market by Lewis A. Osborn, and later exploited by Thomas Reid in the early sixties, appears to have been the original package coffee, much of the fame attached to the name of Arbuckle comes from its association with the Ariosa coffee package, which was the first successful national brand of package coffee. It was launched in 1873. The Ariosa premium list (premiums have been a feature of the Arbuckle business since 1895) includes a hundred articles. Almost anything from a pair of suspenders or a toothbrush, to clocks, wringers, and corsets may be obtained in exchange for Ariosa coupons.

The common belief that the name Ariosa was made up from the words Rio and Santos (said to be the component parts of the original blend) is erroneous. It was arbitrarily coined, though it is not known what considerations prompted it. One story has it that the "A" stands for Arbuckle, the "rio" for Rio, and the "sa" for South America.

Early in the seventies, the great business opportunities of New York City had attracted the two brothers, and a branch was established in New York in charge of John Arbuckle, the main business in Pittsburg being left in the care of his brother Charles. The growth of the New York branch soon made it necessary for Charles Arbuckle to leave the Pittsburg business in charge of trusted employees, and to come to New York. In time, the coffee business of the New York house overshadowed the grocery lines; and the latter were abandoned there, so that the entire energy of the firm in New York might be devoted to the coffee business, which thenceforth was operated under the firm name of Arbuckle Bros. The Arbuckle coffee business, which began with a single roaster in 1865, had eighty-five machines running in Pittsburg and New York in 1881.

Charles Arbuckle died in 1891, and John Arbuckle admitted as partners his nephew, William Arbuckle Jamison, and two employees, William V.R. Smith and James N. Jarvie, the business continuing under the former name of Arbuckle Bros. The most important step taken by the firm while thus constituted was its entrance into the sugar refining business in 1896. That entrance had to be forced against the bitterest opposition of a so-called sugar trust, and brought on a "war" signalized by the most ruthless cutting of prices of both coffee and sugar. This war was costly to both sides; but when it had ended, Arbuckle Bros. remained unshaken in the preeminence of their package-coffee business and had acquired also great publicity and a fine trade in refined sugar.

Arbuckles were always large consumers of sugar in connection with their coffee glaze, and having introduced the package sugar idea with their customers some years before, they at last made up their minds to refine for their own needs and thus to save the profits paid to "the Havemeyers". It is generally conceded that John Arbuckle's shrewdness and business sagacity in having previously acquired the Smyser patents on a weighing and packing machine, and his control of it, really led to the coffee-sugar war. "This packing machine", said the _Spice Mill_, when Henry E. Smyser died in 1899, "puts him [Smyser] with the greatest inventors of our day."

The sugar trust met the Arbuckle challenge by invading the coffee-roasting field. This they accomplished by securing a controlling interest for $2,000,000 in one of the largest competing roasting plants in the country, that of the Woolson Spice Co., of Toledo, Ohio, that had in the Lion brand, a ready-made package coffee wherewith to fight Ariosa. The re-organization of the Woolson Spice Co. in 1897, when A. M. Woolson was relieved of the office of president, disclosed, among others, the names of Hermann Sielcken in close juxtaposition to that of H.O. Havemeyer on the board of directors. Both men helped to make coffee-trade history.

The trade found the coffee-sugar war the all-absorbing topic for several years. Hot debates were held on the question as to whether, on one hand, the Arbuckles had the right to enter the sugar-refining business and, on the other, as to whether the sugar-trust had a right to retaliate. The answer seemed to be "yes" in both instances.

In two years, John Arbuckle's model sugar refinery in Brooklyn was turning out package sugar at the rate of five thousand barrels a day. The Woolson Spice Co. was credited with spending unheard-of sums of money in advertising Lion brand coffee. The eastern newspaper displays alone exceeded anything ever before attempted in this line. However, many people are of the opinion that it was a tactical error on the part of the sugar interests to spend so much money advertising a Rio coffee in the central and New England states, while John Arbuckle was confining his activities to the south and the west, where there already existed a Rio taste among consumers.

The legal fight which the Arbuckles carried on with the Havemeyers for the control of the sugar business in this celebrated coffee-sugar war is said to have cost millions on both sides.

Eventually, the Havemeyers were glad to be relieved of their coffee interests, but John Arbuckle continued to sell both coffee and sugar.

Mr. Arbuckle married Miss Mary Alice Kerr in Pittsburg, in 1868. She died in 1907. His many charities included boat trips for children, luxurious farm vacations for tired wage-earners, boat-raising and life-saving schemes, a low-priced home for working girls and men on an old full-rigged ship lying off a New York dock, which he called his "Deep Sea Hotel," and a vacation enterprise for young men and young women at New Paltz, N.Y., which was known as the "Mary and John Arbuckle Farm." A magazine for children, called _Sunshine_, was another benevolent enterprise of his.

When John Arbuckle died at his Brooklyn home, March 27, 1912, he had been ill only four days. The New York Coffee Exchange closed at two o'clock the day following, after adopting appropriate resolutions and appointing a committee to attend the funeral. His estate in New York was valued at $33,000,000.

W.V.R. Smith and James N. Jarvie retired from the firm in 1906; and John Arbuckle and his nephew W.A. Jamison continued it as sole owners and partners until Mr. Arbuckle's death in 1912. Mr. Arbuckle died childless and a widower, leaving as his only heirs his two sisters, Mrs. Catherine Arbuckle Jamison and Miss Christina Arbuckle. Mrs. Jamison is the widow of the late Robert Jamison, who had been a prominent drygoods merchant in Pittsburg. William A. Jamison is her eldest and only living son. Following the death of John Arbuckle, a new partnership was formed in which Mrs. Jamison, Miss Arbuckle, and Mr. Jamison became the partners and owners, and that partnership, without change of name, continues. Probably there is no other mercantile establishment of similar size in the country that is carried on as a partnership, and none which after more than sixty years is so exclusively owned by members of the immediate family of its founders.

The Arbuckle business, as it is today, is John Arbuckle's best monument. All that it is he foresaw; for behind those keen, penetrating eyes, there was wonderful vision. Simple in his tastes; democratic in his dress, in his habits and his speech; he was one of the most approachable of our first captains of industry. Many of the younger generation in the coffee business have found inspiration in contemplating John Arbuckle's achievements. As represented in what has been called "the world's greatest coffee business", these include other package coffees, such as Yuban, Arbuckle's Breakfast, Arbuckle's Drinksum, and Arbuckle's Certified Java and Mocha. The pioneer Ariosa brand is still being sold; although it is interesting to note that the demand for ground Ariosa is increasing, marking the swing of the pendulum of public taste away from the original bean package to the so-called "steel-cut," or ground, coffee package. Will it swing back again, some day? Many coffee men believe it will. If it does, good old Ariosa, with its coating of sugar and eggs, will no doubt be on the job to meet it.

Yuban was launched in the fall of 1913. It is a high-grade package coffee, whereas Ariosa is popular-priced. In addition to the package coffee business, Arbuckle Bros. have many other activities. They deal in green coffee as well as roasted coffee in bulk. The wholesale grocery business in Pittsburg continues under the old name of Arbuckles & Co.; while in Chicago, Arbuckle Bros. have a branch equipped with a coffee-roasting-and-packaging plant, also spice-grinding and extract-manufacturing plants, and do a large business in teas. A branch in Kansas City distributes the products manufactured in New York and Chicago. In Brazil, offices are maintained at Rio de Janeiro, Santos, and Victoria, as Arbuckle & Co. In Mexico, Arbuckle Bros. are established at Jalapa, with branches at Cordoba and Coatepec. In season, the warehouses and hulling plants at those points employ as many as 650 hands preparing Mexican coffee for shipment to New York.

Arbuckle Bros. are direct importers of green coffee on a large scale, and are known also as heavy buyers "on the street." The roasting capacity of their Brooklyn plant is from 8,000 to 9,000 bags per day. The cylinder equipment of twenty-four Burns roasters is supplemented by four "Jumbo" roasters of Arbuckle build, each capable of roasting thirty-five bags at one time. The Ariosa package business grew from the smallest beginnings to more than 800,000 packages per day. Individual brands have not held their lead of late years; but the volume of package-coffee business is greater than ever. Many jobbers now pack brands of their own, besides handling the Arbuckle brands.

Distribution of roasted coffees outside Chicago and Kansas City is accomplished through the medium of more than one hundred stock depots in as many different cities of the United States.

To operate the world's greatest coffee business is no small undertaking; and when this is coupled with an important sugar-refining business and a waterfront warehouse-and-terminal business, plenty of room is needed. So we find the plant along the Brooklyn waterfront occupying an area of a dozen city blocks. An idea of the extent and diversity of the activities of the plant may be gained from a brief reference to the utilities, and the trades, and even the professions, that are required to make the wheels go round.

To ship more than one hundred cars of coffee and sugar in a single day calls for shipping facilities that could be had only by organizing a railroad and waterfront terminal, known as Jay Street Terminal, equipped with freight station, locomotives, tugboats, steam lighters, car floats, and barges. City deliveries of coffee and sugar call for a fleet of thirty-five large motor trucks that are housed in the firm's own garage and kept in repair in their own shops. Although motor trucks are fast replacing the faithful horse; and the time will never come again when Arbuckle Bros. will boast of their stable of nearly two hundred horses that were generally acknowledged to be the finest string of draft horses in the city, some fifty or sixty of their faithful animals still are in harness; and so the stable, with blacksmith shop, harness shop, and wagon-repair shops, are serving their respective purposes, though on a reduced scale. A printing shop vibrates with the whirr of mammoth printing presses turning out thousands upon thousands of coffee-wrappers and circulars; and doubtless it will be news to many that the first three-color printing press ever built was expressly designed and built for Arbuckle Bros. Then there is a sunny first-aid hospital on top of the Pearl Street warehouse where a physician is ever ready to relieve sudden illness and accidental injuries. On the eleventh floor there is a huge dining room where the Brooklyn clerical forces get their noonday lunches. This feeding of the inner man (and woman) is matched by the power-house where twenty-six large steam boilers must be fed their quota of coal. In the winter months, when Warmth must come for the workers as well as power for the wheels, the coal consumption runs up as high as four hundred tons per day.

The barrel factory, with a daily capacity of 6,800 sugar barrels, is located about a mile away, where barrel staves and heads are received from the firm's own stave mill in Virginia, made from logs cut on their own timber lands in Virginia and North Carolina. A more self-contained plant would be hard to imagine, and so we find that even the last activity in its operations--that of washing and drying the emptied sugar bags--is also provided for. That this is "some laundry" goes without saying, when it is recalled that in the busy sugar season the firm dumps from eight to ten thousand bags of raw sugar per day, and that these bags are washed and dried daily as emptied. A huge rotary drier of the firm's own design does the work of about three miles of clothes lines.

Even after the coffees have been sold and paid for, there still remains an important task, and that is to redeem the signature coupons which the consumers cut from the packages and return for premiums. Lest some regard this as an insignificant phase of the business, it may be stated that in a single year the premium department has received over one hundred and eight million coupons calling for more than four million premiums. These premiums included 818,928 handkerchiefs; 261,000 pairs of lace curtains; 238,738 shears; and 185,920 Torrey razors. Finger rings are perennial favorites, and so insistent is the demand for the rings offered as premiums, that Arbuckle Bros. are regarded as the largest distributors of finger rings in the world. One of their premium rings is a wedding ring; and if all the rings of this pattern serve their intended purpose, it is estimated that the firm has assisted at eighty thousand weddings in a year.

Turning from the utilities at the plant to the trades and professions represented, other than the trained sugar and coffee workers, the following are constantly employed: physicians, chemists, mechanical engineers, civil engineers, electrical engineers, railroad engineers and brakemen, steamboat captains and engineers, chauffeurs, teamsters, wagon-makers, harness-makers, machinists, draughtsmen, blacksmiths, tinsmiths, coppersmiths, coopers, carpenters, masons, painters, plumbers, riggers, typesetters and pressmen, and last but not least, the chef and table waiters.

One of the most remarkable things about the growth of this business enterprise is that it is not the result of buying out, or consolidating with, competitors; but has resulted from a steady wholesome growth along conservative business lines. Consolidations are often desirable and effective; but when a great business has been built without any such consolidations, the conclusion is inevitable that somewhere in the establishment there must have been a corresponding amount of wisdom, foresight, energy, and honorable business dealing. Those were the things for which John Arbuckle stood firm, and for which he will always be remembered.

_Jabez Burns, Inventor, Manufacturer, Writer_

Jabez Burns was a person of real importance to the American coffee trade from 1864, when he began to manufacture his improved roaster, until his death, at the age of sixty-two, in 1888. His success depended more on unusual character than unusual ability, although he was really gifted as regards mechanical invention. He loved to acquire practical information, and arrived confidently at common-sense conclusions; and he exercised a wide and helpful influence, because he liked to give expression to opinions that he considered sound and useful.

Mr. Burns was born in London in 1826. The family moved soon after to Dundee, Scotland, and came to New York in 1844. They were people of small means and independent thinking. The father, William G. Burns, had been more interested in the Chartist social movement than in any settled business activity. An uncle, also named Jabez Burns, became a popular Baptist preacher in London.

The first winter in America found youthful Jabez teaching a country school at Summit, N.J. Then he began in New York (1844-45) as teamster for Henry Blair, a prosperous coffee merchant who attended a little "Disciples" church in lower Sixth Avenue where many Scottish families congregated. There also Burns met Agnes Brown, daughter of a Paisley weaver, and married her in 1847. A brave young pair they were, who found all sorts of odd riches--just as if a fast-growing family could somehow make up for a slow-growing income. There were hopes, too, that the contrivances Burns kept inventing might bring wealth; and some extra money did come from the sale of early patents, including one in 1858 for the Burns Addometer, a primitive adding machine.

But Mr. Burns had continued regularly in the employ of coffee and spice firms, and at one time he was bookkeeper for Thomas Reid's Globe Mills. He advanced slowly, because he lacked real trading talent; but he was learning all about the handling of goods, from purchase to final delivery; and when he quit bookkeeping for the old Globe Mills, and began to build his patent roaster, he could advise clients reliably about every factory detail.

He was soon looked on as an authority. He wrote some articles for the _American Grocer_, a series on "Food Adulteration" being reprinted; and in 1878, he began the quarterly publication of his thirty-two-page _Spice Mill_, which soon became a monthly, and gained the interested attention of practically the entire coffee and spice trade.

Through the columns of this paper, in circulars, by letters, and in a pocket volume called the _Spice Mill Companion_, he distributed information on coffee, spices, and baking powder, and gave valuable advice to beginners in the coffee-roasting business. Not a few coffee roasters were started on the way to fortune by the counsel of Jabez Burns. He died in New York, September 16, 1888.

Jabez Burns founded the business of Jabez Burns & Sons in 1864, beginning the manufacture of his patent coffee roaster at 107 Warren Street, New York. Since then, there have been four removals. In December, 1908, the business moved to its present uptown location, at the northwest corner of Eleventh Avenue and Forty-third Street, occupying a six-story building which was doubled in size in 1917. This Burns factory has been referred to as "the unique coffee-machinery workshop", the greatest establishment of its kind in the United States.

Upon the death of its founder the business was continued; first, as the firm of Jabez Burns & Sons, composed of his sons, Jabez, Robert, and A. Lincoln Burns; and later, in 1906, incorporated as Jabez Burns & Sons, Inc., with Robert Burns as president, Jabez Burns as vice-president, and A. Lincoln Burns as secretary and treasurer. Jabez Burns died August 6, 1908. The present officers are: Robert Burns, president; A. Lincoln Burns, vice-president; William G. Burns, general manager; and C.H. Maclachlan, secretary and treasurer.

A. Lincoln Burns succeeded his father as editor of the _Spice Mill_. William H. Ukers was made editor in 1902, and he continued until 1904, when he left to assume editorial direction of _The Tea and Coffee Trade Journal_.

_Coffee-Trade Booms and Panics_

In the last fifty years there have been many spectacular attempts to corner the coffee market in Europe and the United States. The first notable occurrence of this kind did not originate in the trade itself. It took place in 1873, and was known as the "Jay Cooke panic", being brought about by the famous panic of that name in the stock market.

As a result of the Jay Cooke failure, it was impossible to obtain money from the banks. Hence buyers were forced to keep out of the coffee market; and as a consequence, the price for Rios dropped from twenty-four cents to fifteen cents in the course of the trading period of one day[349].

Another interesting development during that year was of foreign origin. A coffee syndicate was organized in Europe, financed by the powerful German Trading Company of Frankfort, with agencies in London, Rotterdam, Antwerp, and Brazil. For more than eight years this proved to be a highly successful undertaking, largely controlling the principal producing and consuming markets.

As far as the American coffee trade is concerned, the first sensational upheaval took place in 1880-81. This period witnessed the collapse of the first great coffee trade combination in this country--the so-called "syndicate", comprising O.G. Kimball, B.G. Arnold, and Bowie Dash, sometimes known as the "trinity".

The period of high coffee prices, commencing in 1870, had greatly stimulated production in many Mild-coffee producing countries, as well as in Brazil, and as a consequence the syndicate found its burden becoming extremely heavy early in 1880. In January of that year our visible supply amounted roughly to 767,000 bags. While this was reduced to about 740,000 bags in July, the latter likewise proved to be decidedly burdensome, especially as another liberal crop was beginning to move in producing countries. The excessive volume of supplies was especially marked, because distributing trade during the summer was strikingly dull, as the majority of buyers were holding off, in view of the prospective liberal new crops. At that time Java coffee was a big item in American markets, whereas Santos was just about beginning to be a factor.

The syndicate found that it had its hands full supporting the Brazil grades, and hence had to let the Javas go. As a result, the latter, which had sold at twenty-four and three-quarters cents in January, 1880, fell to nineteen and one-half cents in July, to eighteen cents in November and to sixteen cents in December. As a matter of fact, the syndicate was practically the only buyer of Brazil coffee during the fall of 1880; and as a consequence, Rios, which had started the year at fourteen and one-half to sixteen and one-quarter cents, were down to twelve and three-quarters cents in December, 1880, and had dropped nine and one-half cents when the break in the market culminated in June, 1881.

The first whispers of financial troubles growing out of these adverse conditions were heard in October, 1880; and on the 27th of that month the first failure was announced--that of C. Risley & Co., with liabilities placed at $800,000 and assets at $400,000. This firm had been doing business in the local market for about thirty years. The efforts of the receivers to dispose of this company's large stock naturally served to accelerate the decline; and the final impetus came on December 6, when the New York trade heard of the death, two days previously, of O.G. Kimball, of Boston, one of the most prominent merchants there. This precipitated the big crash of December 7, when B.G. Arnold & Co., the largest New York firm, suspended with estimated liabilities of $750,000 to $1,000,000. The official statement later placed the liabilities at $2,157,914, and assets at $1,400,000, of which $884,198 were secured. Within three days this failure was followed by the suspension of Bowie Dash & Co., with liabilities estimated at $1,400,000.

For weeks thereafter there was virtually no market. With all of these distress holdings pressing for liquidation, buyers, as was natural, were extremely timid. In the meantime, the import arrivals showed further enlargement at various southern ports, as well as at New York. Total arrivals at this port during 1881 were almost 12,400,000 pounds heavier than for the preceding year. The growing importance of Santos as a market factor was demonstrated by the fact that shipments from there in 1881 were 1,198,625 bags, compared with about 628,900 bags in 1876-77. According to the best informed members of the trade at that time, the losses sustained by the various firms that were forced to the wall aggregated between $5,000,000 and $7,000,000.

The utterly demoralized conditions prevailing while this collapse was in progress, and the practical elimination of a market in the true sense of the word, furnished the principal impetus for the organization of the New York Coffee Exchange. At that time, the Havre market was the only one with an exchange. The local body was organized in December, 1881, and started business in March, 1882.

_The Cable Break of 1884_

The second noteworthy movement, embracing an advance of four to four and one-half cents and a recession of slightly more than three cents, covered a period of about eight months shortly after the Exchange was organized. Various local and out-of-town firms were interested in the bulge which carried Rio coffee in this market from about seven cents in July, 1883, up to eleven and one-half cents late in November. By the middle of December, the price had fallen to nine and one-quarter cents, the final break to eight and one-quarter cents occurring late in March of the following year. At that time, there was no direct cable communication with Brazil; and as a result of a temporary break in the roundabout service by way of Portugal, the New York and Baltimore agents of the Brazilian syndicate were unable to put up additional margins in this market, and their accounts were closed out. This happened on a Saturday; and by the following Monday, partial cable remittances arrived and all accounts were settled in full with interest from Saturday to Monday.

_The Great Boom_

What is generally described as "the great boom" of the coffee trade occurred in 1886-87, and had its inception in unsatisfactory crop news from Brazil. The crop of 1887-1888, it was estimated, would be extremely small; and it turned out to be only 3,033,000 bags. These advices and low estimates led to the formation of a "bull" clique, comprising operators in New York, Chicago, New Orleans, Brazil, and Europe, who set a price of twenty-five cents for December contracts as their goal. Toward the end of June, 1886, when this campaign started, No. 7 Rio in New York was worth about seven and one-half cents, with June contracts on the Exchange quoted at seven and sixty-five hundredths cents. With Brazilian crop news still more discouraging, the advance thereafter was almost continuous, and on June 1, 1887, December contracts sold at twenty-two and one-quarter cents--a new high price record, that was not exceeded for thirty-two years, when twenty-four and sixty-five hundredths cents were paid for July contracts in June, 1919. After reaching twenty-two and one-quarter cents, prices suffered an abrupt reversal. Ten days later the closing price for December was twenty-one and four-tenth cents. Then the real crash began. On Saturday, June 11, the panic started with another claim of cable trouble; and in the short session, December coffee broke from twenty and fifteen-hundredths to eighteen and sixty-five hundredths cents, closing at a loss for the day of 275 points. The first sale of December on Monday was at seventeen and four-tenths cents, or 125 points lower; and after numerous erratic variations, the price broke to sixteen cents, a drop of six and one-quarter cents in less than two weeks. Business on that day was of enormous volume, in round numbers 412,000 bags; and approximately $1,500,000 was put up in margins. For the next three days the decline was temporarily halted, and December, at one time, was up three and one-quarter cents from the bottom (nineteen and one-quarter cents). On June 17, another battle commenced, December dropping back to seventeen cents. Then came a rally to eighteen and one-tenth cents, a drop to sixteen and one-half cents; another rally to eighteen and one-tenth, and, on June 24, another break to the previous low level of sixteen cents for December. This sharp reversal in less than a month was traceable largely to more favorable news from Brazil, the 1888-89 crop being estimated at 6,827,000 bags.

Following a rally to nineteen and six-tenths cents during the next month (July, 1887), the pendulum again swung downward. The climax came with the culmination of the "European fiasco" of the spring of 1888. Reports were received that various European coffee firms had failed; and future contracts in the American market sold as low as nine cents in March.

_A Famous European Bull Campaign_

The next campaign of interest lasted more than two and a half years. In September, 1891, there was a corner in the local market which forced the September price up to seventeen and one-quarter cents. George Kaltenbach, a wealthy speculator living in Paris, combining with three operators in Havre, Hamburg, and Antwerp, succeeded in breaking the corner, forcing the price down to ten and eight-tenths cents. They then changed to the bull side, buying heavily in all markets of the world. This was continued until early in 1893, bringing the price back to fifteen cents. Although his associates then returned to the bear side, Kaltenbach kept on buying; and aided by bad crop reports from Brazil, he worked the price up as high as seventeen and seven-tenths cents. At one time it was said that his profits were more than one million dollars. The collapse of this deal occurred in May, 1893, involving thirty firms in Hamburg, Havre, and Rotterdam. As Kaltenbach could not keep his large New York holdings margined, they were thrown on the market, bringing about a sharp break, and causing the failure of his New York agents, T.M. Barr & Co.

The present era of large crops began in 1894, Brazil's production for 1894-95 being placed at 6,695,000 bags. Nevertheless, Guzman Blanco, a former president of Venezuela, then living in Paris, and said to be worth about $20,000,000, attempted to run a corner in April, 1895. He bought 200,000 bags of spot coffee in Havre warehouses and accumulated a big line of futures in various markets. Assisted by reports of cholera in Rio and some reduction in Brazilian crops, he enjoyed temporary success, the price of Rio 7s in New York rising to fifteen and one-half cents in October, 1895. Thereafter, there was an almost continuous decline. In the spring of 1898, a vigorous bear campaign was conducted, largely in the form of market letters; and by November, Rio 7s here had dropped to four and one-half cents.

_The Bubonic Plague Boom_

The so-called "bubonic plague boom" halted this prolonged downward movement for a time in 1899-1900. The boom derived its name from the outbreak of bubonic plague in Brazil, as a result of which the ports of that country were quarantined. In addition, Brazilian steamers arriving at New York were placed in quarantine; and the impossibility of unloading their cargoes caused a temporary shortage. As a result, prices rose from four and one-quarter cents in September, 1899, to eight and one-quarter cents in July, 1900. The quarantine being lifted, the bears again became aggressive; and by April, 1901, they had forced the price back to five cents.

There was another short-lived attempt to establish a corner in September, 1901. Receipts at Rio and Santos had been running light, encouraging a local clique embracing Skiddy, Minford & Company; W.H. Crossman & Bro.; and Gruner & Company, to endeavor to gain control. The arrivals at Brazilian ports suddenly increased to the largest volume ever known up to that time; and, with vigorous opposition from operators in Havre, the corner here was speedily broken.

The opening of the new century witnessed the beginning of another new coffee era, Santos permanently displacing Rio as the world's largest source of supply. The figures for 1900-01 were: Santos, 2,945,000 bags; Rio, 2,413,000 bags.

Huge crops then became a regular thing in Brazil. That of 1901-02 was far in excess of estimates, being 15,000,000 bags; while 20,000,000 bags were produced in 1902-03. As a result, the world's coffee trade became completely demoralized for the time being. In August, 1902, contracts for July, 1903, delivery sold at six and one-tenths cents. By June, 1903, they had fallen to three and fifty-five hundredths cents, the lowest price ever recorded for coffee.

_The Southern Boom_