and runs were made to check relative yields and the quality of the product. Table 32 summarizes the results of such tests for eight natural forest and two plantation species. These values are only indicative of what may be expected in commercial runs. Nevertheless, they are useful in bringing out differences between species and indicate broadly the average yields that may be expected.

As the yields in table 32 show, a number of Chilean species produce good to excellent yields of charcoal and byproducts compared with the yields of typical distillation species in the United States. There are also distinctive species differences; Ulmo and Tineo, among the more abundant species in Province Group 4, give good to excellent yields though Coigue and Tepa, still more abundant, give only poor to fair yields particularly in charcoal on the basis of present knowledge. Luma and Tepu, the most abundant species group in Province Group 5, are defiruns were made at San Antonio, Chile, through a cooperative arrangement with Quimica del Pacifico..

1 The se the Farmo

Charcoal and byproduct yields from distillation

Yields 1 per stacked cubic meter

1 These test runs were the first full operation of the plant: in general, moisture content was excessive; presumably the yields of chemicals will be higher under experienced operation.

2

This value based on preliminary run only. The values obtained look low in relation to specific gravity.

nitely superior distillation woods giving high yields of charcoal as well as other products. Tineo and Ulmo are also present in Chiloe and Aysen in material quantities.

The production cost-price situation also looks favorable. It is estimated that the cost of obtaining and processing one cubic meter of stacked wood will vary between 80 and 200 pesos with an expectable average cost in better timbered regions of 80 to 95 pesos per cubic meter. Expectable returns from the sale of charcoal and other products vary from 137 to 196 pesos per stacked cubic meter based on conservative prices. It is very doubtful that returns will be as low as 137 pesos if a local market develops for at least a portion of the byproduct yields, a reasonable assumption, and returns of around 200 pesos are believed expectable under reasonably good market conditions.

The prospects are excellent, therefore, of developing a hardwood distillation industry of adequate size. Chile possesses suitable species in abundance; an excellent charcoal market; good potential markets for acetic acid, methanol and derivatives with pending industrial development; and a favorable cost-price ratio. Indeed it would seem that a ' located and administered operation would have a reasonable chance eed even under adverse market conditions.

Accordingly it is recommended that a hardwood distillation proundertaken which will ultimately involve carbonization of not

less than 720 cubic meters per day. This might best be done at 3 plants carbonizing, respectively, 160, 240, and 320 cubic meters each. Such plants would cost about 55,000 pesos per cubic meter per day capacity based on 1937 costs in the United States, though this cost might be considerably higher in Chile. These plants should be located in the natural forest region close to adequate timber supplies but near enough shipping facilities to reduce the handling of finished products, particularly charcoal, to a minimum. Each plant should be operated, if possible, in connection with a sawmill to share logging facilities, obtain cheap fuel and utilize waste. One well-equipped plant, preferably of not less than 240 cubic meters per day capacity, should be installed as soon as equipment can be gotten but construction of the remaining plants might be delayed to observe market developments for acetic acid and methanol.

There are several promising locations for distillation plants but the choice for an initial plant would seem to fall between the Valdivia, the Lakes Region, or the Puerto Montt area. Valdivia and the Lakes Region are both close to an adequate timber supply and the steel producing section, the latter assuring a nearby market for charcoal. Puerto Montt is in a region with the lowest production costs and is close to water transportation for charcoal and byproducts. All things considered, however, the Valdivia area is recommended. An installation here should be in connection with sawmill operations producing not less than 50,00060,000 board feet per day. A tract of 75,000 hectares of average or better forest land would be needed to sustain this joint operation on permanent basis.

a

PAPER AND PULP

Chile's consumption of paper and paper products during the years 1938 to 1942, inclusive, averaged 44,660 metric tons. About one-fourth was imported, chiefly newsprint and specialty papers, showing a reversal of conditions since 1930 when 70 percent was imported as against 30 percent domestic manufacture. The productive capacity of Chilean paper mills is now estimated as sufficient to supply at least 40,000 tons of paper and 4,000 tons of paperboard annually, roughly the equivalent of present domestic requirements. In 1940 production was estimated as 53 percent writing and printing papers, 38 percent wrapping paper, and 9 percent paperboard. Approximately 95 percent of the paper manufactured is the output of one firm with an estimated capacity in 1939 of 37,500 tons divided as follows: newsprint, 15,400 tons; writing and book papers, 10,800 tons; wrapping paper, 11,300 tons; paperboard, 1,250 tons. This company also has facilities for the production of pulp from straw, by the Pomilio process, and for the production of mechanical pulp from wood. During the past three years an average of 9,700 tons of mechanical pulp have been prepared from Araucaria and plantation-grown Insignis Pine, primarily the latter. Pulp imports have averaged about 17,000 metric tons annually for the years 1938 to 1942, inclusive, about 7,650 tons being unbleached sulphite and the remainder about evenly divided between bleached sulphite and Kraft (sulphate).

Several native hardwoods, particularly Olivillo, are suitable for the preparation of bulky pulps of relatively low strength, such as the pulps used in book and other high grade printing papers. About eight of the more important timber species have been tested for pulping qualities.1 Araucaria is a moderately good pulping species for all purposes

In Swedish, German, and American laboratories, through the initiative of the Compañía Manufacturera de Papeles y Cartones and other Chilean industrialists. The Forest Products Laboratory, Forest Service, United States Department of Agriculture, has tested about six Chilean species and has also made extensive tests on Pinus radiata.

but is available in relatively limited supply and is probably more valuable for other purposes. Eucalyptus has also been pulped to some extent. The most promising species available in Chile from a pulp and paper standpoint, however, is Insignis Pine which has a relatively long fibre adapted to the preparation of strong Kraft pulps suitable for wrapping papers of considerable strength. Modern semi-bleaching and bleaching processes adapted to sulphate pulps should make it entirely feasible to use Insignis in the preparation of newsprint or other papers now imported or prepared from bleached or unbleached sulphite pulps. It is now available in Province Group 3 (Concepción and vicinity) in sufficient quantity in planted stands to supply a 70-100 ton per day sulphate mill. Within the next 20 years the supply in this area should be sufficient to furnish wood for a plant of 2 to 3 times this size. Other materials, such as lime, salt cake, and bleaching materials, are also available in Chile in sufficient to abundant quantities.

Preliminary estimates indicate that Chile should be able to produce sulphate pulp in slush form from Insignis Pine for about 1458 pesos per metric ton, estimates ranging from about 1200 to 1800 pesos per ton. Some 50 pesos per ton should be added for lapping.

2

This is substantially higher than prewar (1934) production costs in the United States of about 1015 pesos per metric ton. However, it should be noted that the margin is not as wide as the above estimates would indicate. The comparative United States costs are on a prewar basis. Imported pulp must bear additional costs for drying and shipping of about 300 pesos per metric ton. In the prewar period imported pulp cost in Chile about 1300 pesos per metric ton plus a 600 pesos per ton import duty. In addition, pulping costs are highly variable and there is a reasonable chance in Chile of reducing production costs below the estimate given. The main differences over United States costs are in chemicals, wood, steam power, and general overhead. Substantial reductions should be possible in some to all of these items under aggressive competent management. Only operating labor expense, a relatively small fraction of the total production cost, is now lower in Chile and may be expected to rise. Steam power and chemicals, in particular, seem very high in Chile, being over two to three times as high, for example, as in the United States. Wood costs, substantially higher in Chile and representing about one-fourth of the total estimated cost, could be materially reduced under the favorable growing conditions in Chile, if wood is grown directly by the operating company, and can be expected to decrease in any event as the plantation supply increases.

Accordingly, in view of the obvious national advantages of local manufacture of at least a portion of domestic pulp requirements, every effort should be made to introduce a local wood pulp industry on an economic basis. If this objective can be attained, Chile may, in time, supply substantially all of her domestic requirements and perhaps some pulp for export. Consumption of paper in Chile is now very low, about 20 pounds. per capita annually as compared with 200 in the United States. Consumption of Kraft paper for wrapping and packaging is obviously subnormal in

1The Chilean cane or Quila is of interest in this connection for tests made in 1915 at the Forest Products Laboratory show this material to have a long, strong fibre easily made into a light-colored, fine-fibred pulp suitable for use unbleached as news and wrapping, and bleached as writing, book, and similar papers. If Quila could be grown or concentrated economically in commercial quantity it would make a fine source of raw material for pulping. This seems worth further investigation.

2Partial drying in sheets suitable for storage or for shipping limited distances.

Chile, and paperboard, so conspicuous and rapidly growing an item in many other countries, is also used in Chile in relatively small amounts. A good local supply of these materials at a reasonable price should find a ready and growing market. World consumption of wrapping and other papers and board made from sulphate has increased in greater proportion. than that of white papers. In the United States consumption of sulphate pulp tripled between 1925 and 1936. Bleached sulphate is becoming more important because of its utilization as a substitute for sulphite in the manufacture of high grade papers and its adaptability for blending with other brands of pulp to increase the strength of certain grades of paIt is recommended, therefore, that Chile make a detailed study of the possibility of installing a sulphate mill in the Concepción area close to the raw material supply, preferably with both port and rail connections. This mill should have a capacity of 70 to 100 tons per day, depending on the size of digester units. Such a plant should cost in the neighborhood of 800,000 to 1,200,000 pesos per day-ton capacity. Provision should be made in space, power, and water for expansion to 2 to 3 times its original size as wood supply, production experience, and market conditions warrant.

per.

Rayon

In Chile the textile industry, one of the most important, is also growing rapidly, the imports of raw cotton, for example, having increased from 690 thousand kilograms in 1935 to over 7 million kilograms in 1941, while cotton textile imports over this same period have ranged from 5 to 11 million kilograms, with an intermediate import in 1941 of 7.2 million kilograms.

Chile now has a rayon yarn plant using 600 to 700 tons of high grade dissolving pulp annually and capable of doubling its capacity when additional equipment can be obtained. Actual rayon yarn output is reported at 18,000 kilograms per month, chiefly in the coarser grades. About 85 percent of the domestic consumption of rayon fabrics is local production.

World production of rayon has been going up rapidly, from about 20 million pounds in 1912 to almost 2,000 million pounds in 1938. Past production has been almost wholly filament rayon and has formed the basis for a well established industry still on the increase though at a somewhat slower rate than in the past. The rayon staple fibre industry (using fibres of definite length) is a relatively new industry and the prospects are that it will grow rapidly. In addition, cellophane and other types of cellulose sheeting, lacquers, plastics, and explosives are made from high grade dissolving pulp.

A large part of the rayon pulp prepared by the viscose process (about three-fourths of the total produced) is made from wood pulp and because of a favorable price differential, greater stability in price, and improved pulps from wood, this material, wherever the viscose process is employed, has grown in favor over cotton linters, the other source of basic raw material. The possibility of using Chilean woods for rayon production, for domestic and even export trade, therefore, is of definite interest.

Unfortunately, little or nothing is known about the suitability of Chilean woods for this purpose. Rayon pulps in general are high quality, purified, bleached sulphite pulps made chiefly from spruce, balsam fir and hemlock, or from cotton linters. Almost all the cellulose acetate pulps have been prepared from cotton linters and although some pulp has been prepared by this process from wood, the technology is