A History of the Peruvian Guano Industry

Introduction

For almost 600 years, ever since the Spanish invaded in 1528, Peru has been associated with golden Incan treasures or jungle-clad ruins. It is also the home of the potato, one of the most popular and widely-used vegetables in the world and more than 3000 species of potato can be found there. After an uprising against the Spanish rulers in the early 19^th century Peru, led by the liberators Jose de San Martin of Argentina and Simon Bolivar of Venezuela, finally achieved independence from Spain on 28^th July, 1821.

In the two decades that followed conflicts, both internally and externally, meant that Peru found it very difficult to achieve stability and growth and it wasn’t until Ramon Castilla became President in 1845 that Peru was finally able to settle down and start prospering on its own. As a result of its struggle for independence from Spain the country had accumulated huge debts and was virtually bankrupt, being unable to reply her foreign creditors. From about this time to approximately 40 years later (a historical period often referred to as the Guano Age) the largest input of wealth in Peru, one that would revitalise the whole economy of the young republic, came from a rather surprising source. Guano, or bird droppings, had been accumulating on the coastal islands of Peru for hundreds of years when, due to scientific breakthroughs in Europe, it was suddenly discovered to have great value as a fertilizer.

 

  The Guano Islands

Figure 1 – The most important guano-producing islands of Peru

 

The northernmost guano islands were the Lobos group comprising of Lobos de Tierra and Lobos de Afuera (made up of Isla Independencia, Isla Cachimbo plus numerous small islets). Both of them lie of the coast of the department of Lambayeque with the former at a distance of 19km and the latter 93km.

The Macabi island group, comprised North (“Norte”) and South (“Sur”) islands, are around 10km from the town of Puerto Chicama on the coast of the department of La Libertad. At one point they may have formed one larger island but, due to erosion or earthquakes, they have now become separated by a 35m wide channel. North Macabi Island is around 30m high with a diameter of about 1.5km.

The North and South Guanape islands are about 10km from the Morro Guanape peninsula in La Libertad, just south of the city of Trujillo. The two islands are separated by a 2km channel and are surrounded by various small islets and rocks. South Guanape Island is the higher of the two reaching 165m. Pre-Columbian artefacts dating from the Guanape and Salinar tribes, who lived in the nearby Viru valley around 1000BC and between 200BC and 200AD respectively, were found on the islands when the above layers were removed during guano mining. As well as the artefacts decapitated bodies of sacrificed young women whose ribs and breasts were covered in thin gold foil were also found showing that these islands were known about well before the arrival of the Spanish.

The greatest sources of guano were the three (North, Central and South) Chincha Islands, located in the Bay of Pisco 21 kilometres from the city of Pisco in the Ica department of central Peru. These rocky, barren islands are comprised of volcanic rock, are all less than one mile across and, apart from a couple of narrow beaches, are surrounded by high cliffs up to 300 feet high. There is archaeological evidence of human’s visits to the island going back over thousand years. Some of the artefacts, found deep under the layers of guano and soil, pre-date the Moche tribe from northern Peru who left evidence of their visits to the island, possibly for the purpose of mining guano, during the first millennium AD. Later came the Chincha tribe who ruled this part of Peru from the time of the Moche to just prior to their absorption into the rapidly expanding Inca Empire in the 15^th century.

Of the seabirds that live on these islands the most important is the Guanay Cormorant (Phalacrocorax bougainvillii) which supplies the richest and most plentiful guano. As a result the native Peruvians give it the name “Guanay” meaning “the guano bird”. These, along with other guano-producing birds that live on the islands are the White-Breasted Cormorant (Phalacrocorax lucidus), the Gray Pelican (Pelecanus philippensis), the Peruvian Pelican ((Pelecanus thagus) and the Peruvian Booby (Sula variegata), were at that time estimated to number up to a million and which each bird excreting around 20 grams of dung a day they were capable of producing up to 11000 tons of guano a year.

Figure 2 – from left to right: Peruvian Pelican, Guanay Cormorant, White-Breasted Cormorant, Peruvian Booby

 

Running up the western coast of South America is the Humboldt Current which brings cold water up from Antarctica. This current results in valuable organic and mineral nutrients being added to the coastal water off Peru which supplies food for large masses of plankton. In turn, this plankton is fed upon by small fish such as anchovies or larger fish such as sardines or mackerel. At the top end of the food chain these fish are eaten by those birds mentioned above.

The Humboldt Current also creates a unique weather pattern in which the cold water and the warm air lead to very little rainfall being produced. This meant that instead of the guano being washed away the islands ended up being covered in a layer of extremely hard guano that was over 50 metres thick in places. The hot sun and very dry climate baked the guano and preserved the nitrates and phosphates that made the Peruvian guano the richest in the world.

As well as the bird-life some of the islands were also inhabited by large mammals such as sea-lions (Otaria flavescens) and the southern fur-seal (Arctocephalus australis). All the islands are comprised of the volcanic rock andesite and, apart from some of the larger islands which have beaches, are surrounded by high cliffs making access to them difficult. The waters surrounding the island are very deep, up to several hundred metres, and the seas can get very rough which also limits access. On the higher islands a form of “loma”-type vegetation grows but the majority of the islands are totally devoid of any plant-life due to the thick layers of guano covered them. A lone Chilean Mesquite (Prosopis chilenis) tree once grew on Lobos de Tierra Island but was cut down in 1978

 

The Rise of the Guano Industry in Peru

The use of guano as fertilizer is said to have originated with the Moche tribe who lived along the northern coast of Peru from around 100AD to about 800AD. From around the 14^th century the Incas made extensive use of the guano. The word “guano” actually comes from the old Quechua word “huanu”, meaning “dung”. Guano was considered so important to the Incas that they limited access to the islands and anyone found to have killed one of the guano-producing birds was sentenced to death. They allocated each of the islands to a particular province and only farmers from that province had access to the guano produced by a certain island.

Ever since the Spanish had arrived in the country in 1527 it had mainly been forgotten about. As well as the many losses suffered during the Spanish invasion the population of the Incas was also decimated by civil war, disease and famine and many of those that remained were forced into slavery. Because of this the necessities for guano in native farming declined rapidly although there were a few visits to the guano islands by foreign vessels over the next two centuries.

In the early 19^th century, when there became a need for new sources of fertilizer, for the European market in particular, the guano industry woke up from its long slumber. It was the German explorer Alexander von Humboldt (who gave his name to the Humboldt Current), along with the French botanist Aimé Bonpland, who re-discovered the properties of the material in 1802 during their South American expedition. They sent samples of the guano to various European chemists, for example Sir Humphrey Davy, for analysis and it was found to be extremely rich in phosphorus and nitrogen, important ingredients for photosynthesis and growth respectively, but its potential was not fully appreciated at the time and it remaining hidden to the outside world for another 30 years or so. Therefore European farmers continued using recycled waste and bone-meal as their sources of fertilizer. By the mid 19^th century, the ever-growing European population meant that the farmers could not keep up with the required amount of crops and their soils were quickly becoming exhausted of any nutritive value.

 

Figure 3 – Left: Alexander von Humboldt, Right: Sir Humphry Davy

 

 

In 1838 two Lima businessmen, Carlos Barroilhet and the French-Peruvian Aquiles Alliers, became convinced of the almost magical properties of the guano and asked an English merchant living in Valparaiso, Chile to send a sample to a merchant in Liverpool by the name of William Myers. Myers had many contacts within the local farming community and decided to hand out samples of the guano to these farmers to try out on their fields. The result was their best harvest for a very long time and in 1841 Professor James Johnston, of Durham University’s chemistry department published a paper (‘On Guano’) in the Journal of the Royal Society of Agriculture which showed that when used alongside more traditional fertilizers the guano performed extremely well. It was soluble, fast-acting and had an immediate effect on the growth of plants. These results captured Myer’s attention in such an amount that he put up a large amount of his own money to start importation of the guano. By 1841 the first cargo ship left the Peruvian port of Callao laden with around 2000 tons of guano for its final destination, Liverpool.

 

Chinese Slavery within the Guano Industry

All that was required to turn the guano into an almost inexhaustible supply of wealth was an army of workers, equipped with the necessary tools, to chip it away from the rock beneath. Initially these workers were comprised mostly of native slaves, army deserters and prisoners but soon the industry had expanded so much that the local workforce was insufficient and therefore another source of labour was needed. This source took the form of thousands of Chinese workers who travelled across the wide Pacific Ocean, in over-crowded, disease ridden ships, from cities such as Amoy and Macau. John Meares, a Royal Navy lieutenant and explorer, had used Chinese slaves in his fur trading industry on Vancouver Island at the end of the 18^th century and they were also used in the sugar plantations on Hawaii in the early 19^th century. The rapid increase in the population in China during the first half of the 19^th century led to food shortages and poverty within the country and the these factors, along with the first Opium War between 1839 and 1842 forced many Chinese out of the country to seek their livelihoods elsewhere.

They had signed on, for periods of up to five years, after having been promised riches for both themselves and their families by the English agents at work in China looking for cheap labour. They were also under the false impression that they would actually be going to work in the gold mines of California rather than the guano islands, railways or sugar plantations of Peru. Many died during the five-month ocean voyage, through illness, flogging or from jumping overboard to escape the terrible conditions onboard, although it was estimated that around 30,000 workers still made it to the Chincha Islands between the mid 1840s and the mid 1870s. 

Figure 4 – A Chinese “coolie” being flogged onboard a slave ship

 

Figure 5 – The hold of the slave ship full of newly loaded “coolies”

A number of small villages, home to around 3000 workers and officials in total, eventually grew up on the islands. These buildings comprised mainly tiny, frail bamboo huts but those used for administration or for the housing of the officials were generally somewhat superior. On other islands the worker usually just slept in temporary accommodation such as tents during the periods of guano extraction. Their bedding consisted of old sacks that housed large populations of fleas and flies due to the poor sanitation standards. Water was provided by concrete cisterns which were filled by passing tankers as and when required although some of the larger islands had their own supply of running water. North Chincha Island housed the major facilities including a hotel, a small hospital and a number of extremely over-worked doctors. Very little evidence of these buildings remains today.

Figure 6 – The hotel near the main harbour of the Chincha Islands

 

Figure 7 – Chinese accommodation on the Chincha Islands

 

The Chinese workers soon became known by the nickname “coolie” (from the Hindu work kuli meaning “hired labourer”) and had to endure extremely arduous conditions, working up to 120 hours per week (an average of over 17 hours per day with no day off) under very hot, dry conditions. They were also unprotected by the labour laws that applied to other workers and so their masters could do pretty much as they pleased without fear of any legal punishment resulting from their ill-treatment. Black British slaves were employed to whip or flog any worker who did not pull his weight. Severe misdeeds were punished by tying the miscreant to a buoy in the sea. Instead of the promised riches they received payment of only 1 Peruvian Real per day and a small rice allowance. In order to try and pacify the workers the Peruvian authorities liaised with the British to import opium.

Once the guano had been removed, using picks and shovels, from the huge hills which covered almost the whole area of the islands it had to be transported in wheel-barrows, through distances ranging from only a hundred yards to up to a quarter of a mile, to depots perched high on the edge of the surrounding cliffs. These depots took the form of bamboo enclosures, supported against the cliff-face by chains. The guano was then emptied through canvas pipes called mangueras, located in the bottom of the enclosures, into waiting barges far below. The barges then transported the guano to the waiting merchant ships waiting off-shore. It took around three months to fill a ship with guano, especially as much of it was lost into the sea due to careless loading.

Figure 8 – A guano chute or “manguera” on the Chincha Islands

 

The dust from the guano caused many problems to the miners causing their lips and noses to bleed, producing conjunctivitis in the eyes and resulting in many of them dying from respiratory diseases such as bronchitis. Other diseases such as influenza and malaria were also very common as was infestation with ticks from the guano birds. The workers had to survive on a meagre diet of dried meat, hard bread and maggot-infested rice which was nowhere near enough to provide them with enough sustenance for their hard work, often having to manually mine up to 5 tonnes (between 80 and 100 barrows full) of guano per day. This diet led to many of the workers suffering from scurvy due to the lack of vitamin C.

The majority of the workers were of slender form and not at all used to such a severe workload and a great number of them eventually succumbed to over-working or to one of the various diseases that frequented the islands. Even amongst those who somehow managed to stay disease-free a large number chose suicide, over-dosing on opium, hanging themselves by their braces or throwing themselves off the high cliffs into the ocean far below. Very few of the 30,000 workers managed to complete the full five year term of their contract. The mortality rate during the first 15 years of the guano industry was between 35 and 40 percent.

 

The Lobos Islands Incident

By 1850 the guano industry had grown to such an extent that the US president, Millard Fillmore, declared during his State of the Union address that “Peruvian guano has become so desirable an article to the agricultural interest of the United States that it is the duty of the Government to employ all the means properly in its power for the purpose of causing that article to be imported into the country at a reasonable price.”

In June 1852 a conflict arose between Peru and the United States when the latter declared that they had the right to remove guano from the Lobos Islands. They claimed that the islands had been first discovered by the American ship Wasp in 1823 and that the distance of the islands from the Peruvian coast and their unpopulated status meant that Peru should have no jurisdiction over them. The British also had their eye on the islands and so the U.S Secretary of State Daniel Webster stated that a deal should be made with Peru to obtain the islands at an advantageous price. Meanwhile he threatened to send the US Navy to the islands to protect American ships in the area.

The Peruvian diplomat Juan Ignacio de Osma replied that the islands had actually been discovered by the Spanish conquistador Francisco Pizarro during his journey to Peru in the 16^th century and that Peru claimed them as sovereign territory. Webster and Osma met on 2^nd July but were unable to come to a satisfactory agreement. A short time later Osma wrote to Webster stated that whilst Peru was obviously very weak compared to the United States they were willing to defend themselves in the matter with whatever means necessary.

On 21^st August Webster wrote the J. Randolph Clay, the American ambassador in Lima, that conflict with Peru should be avoided at all costs and that any acts against Peru by private US citizens would be considered an act of war. He also asked Clay to try to obtain acceptable rights for the US to take guano from the islands. In reply Peru put together documentation that proved their rights to the islands so convincingly that the US President Millard Fillmore was moved to apologise for the behaviour of the US towards Peru and gave recognition of Peru’s ownership of the islands.

  

The further rise of the Guano Industry

The price of Peruvian guano was now very high and controlled mostly by British companies (by the mid 1850s Britain was importing up to 300,000 tons of guano, mostly for use in turnip farming) so the Americans had to look elsewhere and therefore in 1856 the Guano Islands Act was passed, allowing the United States to acquire any un-occupied guano islands in the Pacific and Caribbean regions in order to build up their supplies, of great use in helping the American farmer’s crops grow. Around 60 islands were obtained due to this act but many were released from U.S control once the guano craze had diminished during the 20^th century due to the development of artificial fertilizers.

Another regular visitor to the Chincha Islands at that time was the Irish-born William Russell Grace. Grace originally worked for the English import company Bryce Brothers as a chandler, supplying their ships with tools and other equipment. Grace took ownership of a old wreck situated just offshore from the Chincha Islands and converted it into a ship’s store which prevented the trading ships that visited the island from having to make the long trip to Callao for supplies. He later set up his own company Grace Brothers and Co. with his brother Michael which became so successful that he was able to buy out his former employers Bryce Brothers.

During his time in the Chincha Islands Grace also met his future wife, Lillius Gilchrist, the daughter of one of the ship’s captains who was supplied by Grace. They would go on to have eleven children, the first three of which were born on the Chincha Islands. In 1880 Grace would become the first Irish-American Catholic mayor of New York City. He held this post until 1882 then, after returning to the business world for a couple of years, became mayor of the city once more in 1884 until the end of his term in 1886. During this second term in office Grace accepted the French gift of the Statue of Liberty to the city.

In the early 1850s a British officer who was visiting the Chincha Islands reported seeing the simultaneous loading of guano into 100 ships, representing 11 different countries (44 from the United States, 40 from Great Britain, five from France, two from the Netherlands and one each from Norway, Sweden, Russia and Armenia as well as three delivering to local farmers in Peru). In addition hundreds of other large ships would be waiting their turn, for up to eight months, off-shore.

Figure 9 – Ships offshore from the Chincha Islands waiting to load up with guano

 

In 1860 433 ships took away a total of almost 350,000 tonnes of guano just from the Chincha Islands alone and the total annual income for the whole country came to just under 15 million dollars. Sir Clements Markham, the notable British explorer, made a visit to the Chincha Islands during that year and estimated that at the current rate of extraction the guano would last for another 20 years.

Despite this the worldwide demand for guano could not be met and other sources of guano from other islands throughout the world had to be used. This guano was usually far inferior to that found in the islands of Peru but despite this was often labelled as “Peruvian Guano” so that those buying it might think it was the real thing are therefore as a higher standard than it actually was.

The windfall brought about by this exporting boom created an artificial prosperity, which meant that the government could get by without having to implement proper financial control over the country. It also led to a huge increase in the number of capitalists who lived off the state and lived in exuberance from the massive amounts of money their guano export companies produced.

Initially each year’s guano output was sold to one or two private merchant banking firms in either Great Britain or continental Europe. One of these firms was the London firm Antony Gibbs and Sons who would play a major role in the guano industry for almost 20 years. The company had first opened an office in Lima in 1822 and initially dealt with items such as cocoa, cotton, tin, silver and wool. In 1842 they first signed a contract giving them rights to trade guano, an industry which was growing rapidly by then.

In 1847 they became the only company with rights to supply Peruvian guano to the North American and European markets and quickly became the most important company in the guano industry. They bought guano at a price of $15 per ton and sold it at $50 per ton. Britain was the major customer and generally imported around 100,000 tonnes per year but growing demand from the British farmers meant that more than 300,000 tonnes of guano was sent to Britain in 1858. The American market was somewhat less reaching a peak of 176,000 tonnes in 1855.

Figure 10- Peruvian guano exports 1845-1879

 

Later the guano market was opened up to syndicates of Peruvian businessmen, who paid for the product via loans obtained from the government at very high interest rates. From these re-payments the government was able to pay back most of the debts it had accrued from the various wars Peru had been involved in over the past few decades. However, it meant that they became increasingly indebted to the guano trade from a financially which, for the many people who relied on this income, spelt danger for the future should anything happen to this industry. For example, in 1859 the total state revenue was just under 22 million dollars of which 16 million came from the export of guano.

These problems came home to roost in the following decade when the supplies of guano, which had been extracted in increasingly higher numbers in the preceding years, suddenly began to diminish. This also led to a large decrease in the national revenue, which depended extremely heavily on the industry, and subsequently a large increase in the country’s debts, both internal and external.

 

The Chincha Islands War

After losing its control over South America during the early part of the 19^th century Spain had suffered a number of crises, both internally and externally, and had been struggling economically and politically for a few decades. When Isabel the Second took the Spanish throne in 1843 the country’s fortunes began to rise once again. Following a number of successful military campaigns in places such as Morocco, Indochina and the Dominican Republic Spain was the fourth largest navy in the world by the early 1860s

In 1862 Queen Isabel sent a fleet of Spanish vessels, including three warships, to South America under the guise of a scientific expedition. In reality the trip was also to try and provide support to Spanish citizens living in the Americas. After brief stop-overs in the Chilean port of Valparaiso and the Peruvian port of Callao the fleet, under the command of Admiral Luis Hernandez Pinzon, continued on its way to San Francisco. Despite not having diplomatic relations with Peru since their independence from Spain in 1821, a decision which Spain still did not recognise, relations between the Spanish and the Peruvian authorities were said to have been friendly during their visit to Callao. They even paid a visit to the office of the Peruvian president, Pedro Diaz Canseco,

In August 1863, shortly after the Spanish had left for the United States, a fight broke out on a large farm in the village of Talambo in Lambayeque between immigrants from the Basque region of Spain and Peruvian natives. In 1859 the owner of the farm, Manuel Salcedo Peramas, had invited over seventy families from Spain to help with the cultivation of cotton. Upon hearing this the Spanish Government prevented the families from travelling as they felt it was derogatory to Spain that her subjects should be hired as farm labourers. As a result the emigrants had to travel to Callao via a French port using French passports. Senor Salcedo paid for their passage as well as supplying funds for them to purchase any necessary provisions.

When they reached Peru a number of the emigrants and their families decided to find employment elsewhere whilst keeping the money provided to them by their benefactor. However, the majority continued onwards to Talambo to take up their posts on Senor Salcedo’s farm. For four years things went very well with the Basque workers creating a very good impression and helping Senor Salcedo’s cotton production to flourish. But in August 1863 one of the Basque settlers, Marcial Miner, had a disagreement with Salcedo. This led to a small battle between the Basques and locals resulting in one member of each group being killed and a number being injured on both sides

Once Admiral Pinzon, whose fleet was still on route to San Francisco, heard about the incident he turned his ships around and returned to Callao. Once back in Peru Pinzon demanded an apology from the Peruvian government over the death of the Basque as well as compensation to the other affected immigrants. In response the Peruvians claimed that the incident was simply an internal matter, could be sorted by their own justice system and that no apology was necessary.

 

Figure 11 – Left: Admiral Luiz Hernandez Pinzon, Right: Manuel Salcedo Peramas

 

This response proved to be less than satisfactory to the Spanish government in Madrid who then decided to claim back the expenses owed to them by Peru following the Peruvian War of Independence in the early part of the 19^th century. To negotiate on this matter Spain sent Eusebio Salazar y Mazaredo to Peru in the role of a Royal Commissioner. Peru found Mazaredo’s title to be insulting in that a commissioner is generally no more than a colonial functionary and that his correct title should have been ambassador, that is someone who acts as a diplomatic envoy for negotiations with an independent state. This matter meant that the talks between the two countries got off to a rocky start and things didn’t improve with Mazaredo and the Peruvian Foreign Minister Juan Ribeyro failing to come to an agreement.

In April 1864, angered by the lack of progress, Spain decided to take matters into their own hands by taking control of the Chincha Islands, Peru’s primary source of guano. The islands were only lightly defended and therefore the 400 Spanish marines were able to capture them without any trouble. Upon doing so they raised the Spanish flag over the islands and put the local Governor Ramon Valle Riestra under arrest upon the frigate Resolución. The Spanish planned to use the islands, which provided almost 60% of all of Peru’s revenue, as a bargaining tool and there were even proposals to pass them onto the British in exchange for Gibraltar.

Figure 12 – the Spanish Squadron, commanded by Admiral Pinzon, taking possession of the Chincha Islands

Figure 13 – Spanish troops on the Chincha Islands

 

The Spanish also blocked the major port of Callao causing much resentment throughout both Peru and the whole of Latin America. The newly elected Spanish Prime Minister, Ramon Maria Narvaez, decided to replace Admiral Pinzon with the more military capable Rear Admiral Juan Manual Pareja. Pareja had actually been born in Lima prior to Peruvian independence and his father had been killed whilst fighting in the Chilean War of Independence. Prime Minister Narvaez also sent another four warships to strengthen the Spanish fleet in the Pacific.

Rear Admiral Pareja arrived in Peru in December 1864 and immediately began discussions with the retired General Manuel Ignacio de Vivanco, the special representative of the Peruvian president Juan Antonio Pezet. After negotiations lasting about one month the Vivanco-Pareja Treaty was signed onboard the frigate Villa de Madrid on January 27^th, 1865. As a result of this treaty Spain would give up the Chincha Islands in return for Peru paying their debts from the War of Independence as well as all costs relating to the Spanish occupation of the islands.

The contents of the treaty were seen as a great insult by many Peruvians, including the former president Ramon Castilla who was now the head of the Peruvian senate. When President Pezet attended the senate to discuss the treaty he and Castilla got into a heated debate which resulted in Castilla punching Pezet and being forced into exile in Gibraltar. In February 1865 an uprising against President Pezet broke out in the southern city of Arequipa. The revolt was led by Colonel Mariano Ignacio Prado who marched to Lima with 10,000 troops to try and wrest control from Pezet. Prado’s men encountered no resistance until they reached the main square in Lima, the Plaza de Armas on 5^th November. Here they finally met troops loyal to Pezet and over the next five days fighting took place. By this time Pezet’s men had been reduced by three quarters and they were forced to surrender enabling Prado to enter the Government Palace.

Initially Pezet thought about launching a counter-attack but due to his forces having been drastically reduced by fighting and desertion instead choose to embark on a boat taking him to exile in England. Once there he lived with his family in the town of Richmond, close to London, before returning to Peru in 1871.

Figure 14 – Left: Juan Antonio Pezet, Right: Mariano Ignacio Prado

 

Collapse

By 1868 the president of Peru was the former soldier Colonel Jose Balta who lacked any of the skills in finance or business which were heavily required at that time. His Finance Minister, Jose Nicholas Baltasar de Pierola, did have these necessary skills but his overly optimistic outlook led to him being over-confident in the remaining amounts of guano and mineral salts. His estimation that the resources would last for the foreseeable future led him to continue with the country’s plans of expansion and development, plunging the country even further into the red.

In 1869 he arranged for 2 million tons of guano to be supplied to the Parisian firm Dreyfus, in return for exclusive exportation rights of Peruvian guano to Europe and other parts of the world. Dreyfus would also pay 2 million sols to the Peruvian government as well as further payments of 750,000 sols every month up until March 1871. In addition to this Dreyfus also agree to subsidise Peru’s foreign debt to the sum of 5 million sols per year which helped somewhat towards reducing the country’s financial arrears and improved it’s standing with possible investors abroad. However, it was a great blow to Peru’s national pride that they had to resort to handing over this great source of wealth to a foreign company.

Despite this input by 1872 the country’s finances had worsened to such an extent that it was on the brink of bankruptcy and it was against this background that the general election of that year took place. President Balta’s popularity was extremely low, as might be expected, especially with the guano exporters who still had a lot of influence in the country. And with no real political backing behind him he had no choice but to sit-out of the election and instead put forward the former president General Jose Rufino Echenique, by now well past his prime, as his supported candidate.

Standing against Echenique was Manuel Pardo of the Civilista Party, who for many years had predicted possible financial ruin for Peru if it continued to put all of its financial eggs into the guano basket. He had also served as the Minister for Finance under the dictatorship of his near namesake Colonel Mariano Prado during the 1860s when he had attempted, and failed, to introduce proper financial controls which would have reduced the country’s reliance on the guano industry. He had the support of the business community but, due to his radical views, was not very popular with the church and the army. Despite this he easily won the election. However, the military were not willing to give up without a fight and Balta declared that the election was null and void because of the disorderly way it had been conducted. Therefore a second election took place, this time with the civilian Antonio Arenas replacing General Echenique as the army’s candidate. The result of this election was just the same and once again the Civilista Party won leading to the army taking direct action this time, although without Balta’s support.

The War Minister Colonel Tomas Gutierrez, along with his three brothers who were also colonels in the army, seized the presidential palace in Lima, imprisoned Colonel Balta and named himself as the country’s dictator. By now the embittered Peruvian public had had quite enough and a number of them also stormed the palace, killing one of the Gutierrez brothers in the process. Tomas Gutierrez claimed that Colonel Balta had been responsible for his brother’s murder and had him shot.  But the angry mob continued their actions and broke into the barracks where Gutierrez and his remaining brother were hiding, killing the pair of them. Their mutilated bodies were then hung from the cathedral for all to see.

Figure 15 – Left: José Balta, Right: Tomas Gutierrez

 

As a result of all this Manuel Pardo was finally installed as the first ever civilian president of Peru. But his inauguration could not have come at a worse time financially. The income from the guano industry was by then barely sufficient to cover all the government’s debts. The contract with the Parisian company Dreyfus was therefore re-negotiated to allow for a partial return to the exportation of the guano on a royalty basis.

It wasn’t just guano that was supplying the Europeans with their highly prized fertilizers. Another source was found in the deserts of southern Peru, which were rich in mineral salts such as sodium borate and sodium nitrate. The resources of sodium nitrate were estimated to be enough to last for 1000 years if the current export rate through the local port at Iquique, almost 70000 tonnes per year, was continued. Industries connected with the extraction and exportation of these salts, were brought into a government monopoly in order to try and create a new source of income alongside that of the guano.

In 1879 things took a massive turn for the worse when the War of the Pacific broke out with Chile over the rights to these nitrate rich deserts. Peru’s defeat resulted in the loss of the Tarapaca province, a provider of great wealth to the country, to Peru’s southern neighbour. Thus, the warnings of the likes of Manuel Pardo and Sir Clements Markham who had predicted great financial disaster due to the over reliance of the fertilizer industry came starkly true.

With the loss of the nitrate-rich regions and with the guano supplies almost empty Peru had no way of achieving the necessary income to pay off the foreign debts and had to resort to transferring the state railways to the British.

 

 Revival

At the height of Peru’s guano age, between 1840 and 1880, it was estimated that over 20 million tons of guano were exported, producing profits of around $2 billion. However, by 1890 the guano supplies had almost been exhausted. In order to try and protect the remaining supplies the Peruvian government set up the Guano Administration Company (GAC) whose job it was to manage the guano by preservation of the seabirds and their island environments. One method used was to ban any guano companies from having access to the islands for 6 months per year in order to allow the birds to build up the guano reserves and raise their young in peace. To preserve the bird’s main diet, fish, the administration also controlled the fishing industry, setting quotas so as to maintain the necessary amount of fish for the birds to feed on and therefore keep their population at a satisfactory level. After 1909 the guano was only removed during winter, outside the breeding season, even though the seas are usually a lot rougher during this period.

The sentries that were posted to the islands were training by Peruvian scientists, and as well as their guard-duties they would make regular observations of the birds on their island. They would sketch the distribution and breeding status of the birds and from these maps a rough estimate as to the amount of guano that would be produced and how much effort would be needed to remove it could be made. Walls were built along the edges of cliffs in order to retain guano and stop nests and eggs from falling into the sea below. Slopes were cleared of stones and smoothed to help the building of nests and so increase the number of breeding birds. Maintenance of the docks, buildings and equipment needed for the removal and transportation of the guano was also carried out.  

GAC also tried to eradicate any predators from the coastal islands. Large gulls, skuas, turkey vultures and even Andean condors all fed on either the eggs or chicks of the guano-birds whilst the peregrine falcon caught adult birds in flight. On Asia Island, a small guano island around 100km south of Lima, eighteen Andean condors were responsible for wiping out the entire breeding colony in the space of only a few days. In 1915 GAC started systematic extermination of these predators by providing guns to the sentries and lighthouse keepers posted on the islands. It was reported that, on some of the southern guano islands, more than five thousand birds were killed during the months of February and March in 1917 alone.

Alternatively the large mammals such as sea lions that inhabited the islands were thought to be advantageous to the guano production in that they attacked shoals of fish from below thus forcing them up to the surface where they could easily be picked off by the seabirds. Therefore Peru banned the hunting of sea-lions 1896. In 1910 the marine zoologist Robert Coker published a report which concluded that there was in fact no real evidence that sea-lions were particularly beneficial for the guano-birds and so this hunting law was relaxed. The market for the sea-lions skins, oil, meat and whiskers lead to as many as 36500 of them being killed in a single hunting season. Later on fisherman came to view the animals as pests and there was little attempt to control the slaughter and by 1961 the sea-lion population had been reduced to only 8000.

One threat to the guano that was outside the administration’s control was that of the weather. The El Nino weather system has a major impact on the climate and environment in that part of the world, warming the ocean and killing off large amounts of fish. If the fish population falls too much it could lead to a reduction in the seabird numbers and subsequently would affect the amount of guano. The El Nino of 1911 forced many of the seabirds to leave the area ruining that season’s guano production and leading to the death and destruction of tens of thousands of hatchlings and eggs. However, the Peruvian Corporation of London still continued to export guano to the UK and Europe and worried Peruvian farmers also hoarded supplies to try to fend off possible shortages in the coming years. This led to the Peruvian government closing the Ballestra Islands, at the time their most productive territory, between 1914 and 1916 in order for the bird population and guano levels to recover. When it was re-opened the islands were only allowed to supply fertilizer for local agriculture.

In 1925 another devastating El Nino event caused a huge decline in guano production. The general manager of the GAC, Francisco Ballen, tried to blame the drop in guano on the local fisherman accusing them of over-fishing and therefore leading to the guano-birds being unable to find sufficient food. He had had a long-standing dispute with the fishing community and for many years had tried to prevent fishing around the guano islands. He convinced Augusto Leguia, who was serving his second term as president at that time, to implement a Fishery Police to patrol the coastal waters and apprehend any fisherman who fished too close to the islands.

Due to the worldwide Great Depression in the early 1930s prices for both sugar and cotton collapsed. This lead to Peruvian farmers stopping purchasing of fertilizer and the guano industry suffered as a result. To counter this the GAC implemented a policy in which farmers could use low-rate, long-term credit to buy fertilizer. Eventually this became the Banco Agricola (Agricultural Bank), an institution who greatly improved the financial situation of many small and medium sized Peruvian farms in the latter part of the 1930s. This made it possible for the farms to adopt more intensive agricultural practices.

In the mid-1930s the price of cotton suddenly increased rapidly and as a result Peruvian farmers quickly converted their crops to cotton. The demand for guano exploded but the GAC had no way or meeting requirements. Their response was to try to force the farmers to use guano more efficiently and implemented a rationing of guano. They also raised the price of guano for those farmers who grow crops for export and gave preferential treatment to smaller farms and those who grew food crops.

The GAC used the substantial profits created by the boom in guano to appoint an American orthithologist, William Vogt, to study finds in which to increase guano production. Vogt used aerial photography and ringing to carry out a census on the number of breeding birds. His studies also discovered that the birds preferred to nest in areas exposed to the prevailing wind. This led to the GAC using explosives to remove any obstacles that prevented prevailing winds on the islands.

In 1939 Vogt’s studies were interrupted by an El Nino event which lasted almost two years and devastated the breeding colonies resulting in guano production plummeting to its lowest level since the 1917 El Nino. Vogt determined that the birds were dying due to malnutrition caused by the lack of food as a result of the marine life on which the birds fed being forced into neighbouring waters by the warm waters brought by the El Nino system.

In 1946 the new general manager of the GAC, Carlos Llosa Belaunde, had the idea of creating artificial islands by walling off headlands along the coast which were already used by the guano-producing birds. Belaunde hoped that these “islands” would provide a safe refuge for the birds to breed during El Nino seasons and would also prevent the birds travelling to the islands off the coast of Chile. Between 1946 and 1961 fourteen “islands” were built along the Peruvian coast and as a result guano production rose dramatically. In 1956 the GAC produced over 330,000 metric tons of guano which contained 6,200 tons of potassium, 31,600 tons of phosphate and 47,000 tons of nitrogen and made a profit of over $17 million most of which was ploughed back into research.

For many years the GAC’s policies worked very well in maintaining guano levels, by the mid 1950s it was estimated that up to 40 million adult birds inhabited Peru’s coastal waters, but in recent years, due to financial and political unrest in Peru as well as over-fishing and the introduction of a fish-meal industry which used the anchovies upon which the seabirds fed, the population in the coastal islands has been decimated once more. In the period following the Second World War anchovies were caught in their billions and after the collapse of the sardine industry in California in the 1950s the amount caught rose into the trillions. GAC warned the Peruvian government that unless a limit was put on the anchovy fishing there was a real threat to the guano industry. In response the government implemented several experimental fishing regulations designed to try and protect the guano birds.

Figure 16 – Graph showing the population of guano birds and the amount of anchovies fished between 1950 and 2000

 

Between 1957 and 1958 an El Nino event along with diseases caused by parasites wiped out many of the guano birds. To try to control the spread of disease the GAC used chemicals to destroy the parasites. It would later be discovered that these chemicals caused egg-shells to thin leading to breeding failure and were even poisoned to the birds the GAC were actually trying to protect.

As early as 1843 scientists were looking for synthetic alternatives to guano, which although very rich in the nitrates and phosphates, was an all-purpose fertilizer that was difficult to adapt to different types of soil or crops. The use, and success, of the guano also led to increased interest in fertilizers and led to the introduction of similar products which could do the job almost as efficiently but at a much lower cost. When guano first appeared in Britain Professor James Johnston had commented that its introduction would “prove a great national service, if it shall teach us to imitate so valuable a natural production.” At the same time Johnston also warned that the supply of the guano was by no means unlimited which also hastened the introduction of alternative sources of fertilizer.

Due to an explosion in Peru’s population in the 1950s and 60s guano only was unable to provide enough fertilizer to the amount of food crops needed to feed the country. According to government experts to only way to cope was to supplement the guano with synthetic fertilizer. Foreign companies were brought in to construct plants which used the Haber-Bosch process to create fertilizer. As a result the Guano Administration Company was renamed the Corporacion Nacional de Fertilizantes (CONAFER).

Along with the extensive overfishing the El Nino of 1965 meant that starving birds were forced to look elsewhere for food and could often be seen scavenging markets and rubbish tips in many of Peru’s coastal cities. When Fernando Belaunde Terry took over as president in 1965 following a year-long military junta one of the first things he did, thanks to a great public demand, was to strengthen laws that would protect the guano industry. He nominated a government committee to come up with long-term solutions to the problem and to try to save what many Peruvians still considered to be “the most valuable birds in the world”.

At around the same time the American biologist Milner B. Schaefer, the world’s leading expert on fish population dynamics, created a model which predicted the future population of anchovies taking into account predation by guano birds. In his opinion Peru would be far better off without the guano birds because of the possible income from the fishing industry as opposed to the guano industry. This sealed the guano bird’s fate and in 1966 the government withdraw the regulations protecting the birds from the fishing industry. From then until the present day the population of the birds has remained at only a few million a drastic fall from the 35-40 million at the height of the guano industry. Today thousands of the birds are illegally killed and sold in markets as food to the poorer members of Peruvian society.

Ironically this comes at a time when organic fertilizers are once again becoming a valuable commodity. There is growing interest in North America and Europe in natural “chemical-free” gardening and it may well be that in the future these markets will lead to the Peruvian guano industry reaching levels similar to those in the 19^th century.

Despite it having a large hand in the second collapse of the guano industry in Peru we should be extremely thankful for the invention of synthetic fertilizers as they have enabled the world’s crops to keep pace with its continuously growing population in a way that would not have been possible if farmers had to rely only on guano and has prevented any occurrence of a Malthusian catastrophe that may have otherwise taken place.

 

 

Advertisement