King of the Canebrakes

Acre for acre, the red lava soil of Hawaii is the richest sugar land in the world. Two of Hawaii's biggest sugar plantations, on the island of Maui, are Hawaiian Commercial & Sugar Co., Ltd. and Maui Agricultural Co., Ltd. Last week, 70-year-old Frank Fowler Baldwin, ruling patriarch of Hawaii's potent Alexander & Baldwin, Ltd., combined the two companies in a $25 million merger. As a result, the new company, Hawaiian Commercial & Sugar Co., Ltd., with 25,454 acres of cane land and a yearly output of 135,000 tons of sugar, becomes the largest plantation on the islands.

Over the Gulch. The ancient Hawaiians had long grown sugar cane on the islands, but it was New England missionaries like Baldwin's grandfather Dwight (he came in 1831) who brought Yankee traders to commercialize it. It was Dwight's son, bushy-bearded, one-armed Henry Baldwin (he lost the other arm in a cane-mangler) who built the Baldwin dynasty. He went partners with Sam Alexander, son of another missionary. At a cost of $80,000 and harrowing effort, Henry built the 17-mile-long Hamakua Ditch to bring irrigation to the cane fields. With son Frank, he once swam a flooded gulch in order to get to church. Through such God-fearing boldness, coupled with Yankee-trader shrewdness, the business prospered, became one of the "Big Five"* which reach across the biggest part of Hawaii's economy.

Today the Alexander & Baldwin interests extend into shipping, hotels, communications, oil, banking, one-tenth of all Hawaiian pineapple, one-eighth of the island sugar. Since Henry Baldwin's death in 1911, the empire has been ruled by stocky Frank Baldwin (the Alexanders are no longer active in the management). Frank is training his own son, Asa, 40, to carry on. Last week, Asa moved into the new company as his father's second in command.

Over the Hurdle? Both the merged companies, though separately owned, were already controlled by the complex holding company pyramid of the Alexander and Baldwin families. In putting both companies into one corporate pocket, Frank Baldwin had several cogent reasons.

Hawaiian sugar plantations are the world's most productive, but their costs have long been among the world's highest, too. They were increased by the organizing inroads of the C.I.O.'s Harry Bridges. Average pay for the industry is $8.10 a day. In a boom year like 1947, when Hawaiian Commercial & Sugar netted $2,200,000, Maui Agricultural $800,000, that was not an insuperable handicap. But recently world sugar has shown signs of returning to its "normal" condition of overproduction. The Hawaiian price has fallen from its wartime high of $126.40 per ton to $108, seems likely to tumble more. With this prospect, Hawaii's planters must somehow cut their costs. Increased mechanization has helped. Last week's merger, said Baldwin, would 1) wipe out duplicate bookkeeping and other management functions, 2) make for a more efficient distribution of the 400 million gallons of water which another Baldwin-controlled company annually sends through the irrigation system started by old Henry's Hamakua Ditch.

* The others: American Factors, Ltd., Castle & Cooke, Ltd., C. Brewer & Co., Ltd., Theo H. Davies & Co., Ltd.

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