Dearie:Russell Family History

SOME RECOLLECTIONS OF THE RUBBER BOOM

By D. O. RUSSELL.

(Original document owned by Michael Russell)

Following upon the cultivation of indigo, which came to grief in around 1890 when the Germans started to produce a synthetic variety, attention was given to gambier (1) and then pepper both of which also failed. This was in turn followed by the planting of Liberian coffee and in the early 90’s a very large number of Coffee Estates were opened up and held promise of good returns. Many of the older rubber estates, such as Kent, Wardieburn, New Amherst etc carry on the names of the original coffee plantations. Even during the later days of coffee attention has been given to rubber and more might have been done were it not for the difficulty in obtaining seed. It is interesting to read in Conway Belfield’s “Handbook of the F.M.S” the cost of opening up rubber estates in 1903. The managers salary is estimated to run to 150 a month.

Shortly after this period and due to the incidence of blight accompanied by heavy price fall practically all the coffee plantations were wiped out and energies devoted to rubber. At the time the commodity was fetching around 4/- a lb which gave, at least on paper, an excellent return. As the price of the commodity rose due to its demand for the growing motor trade so more old coffee estates were reclaimed and applications made to Government for jungle land. By 1908 the industry was well on its way and the skies often full of a blue haze from large tracts of jungle being burned. The price of rubber still continued to climb and the higher it went the more were the numbers of estates floated at huge profits. The London Stock Exchange went mad. Everybody was scrambling to secure rubber shares or land on which to plant up a few acres of seedlings and then to float the area into a new Company. In Singapore it was even worse. Many new companies were floated in the Port where it was possible to sell even virgin jungle land at unheard of values. By this time many if not all of the older rubber companies were making fantastic profits. Shares were changing hands so rapidly that it was quite impossible to collect any dividends to which one might have become entitled and in fact few people ever tried to do so as they were making more money from holding for a week or so and selling at a large margin of profit. There was a great influx of planters-mainly tea planters, from Ceylon who were attracted by the large salaries offered and when in those days it was thought necessary to have a manager and four or five assistants for an area of a thousand acres there was no dearth of open employment.

Even the F.M.S Government fell under the spell of the boom and I well remember my brother and I applied for ten thousand acres of the West of Tanjong Malim in the Sungei Bernam valley for the purpose of reviving the old sugar cane industry but were told that no land could be alienated(2) except for the production of rubber. A foolish attitude to have taken up since a secondary agricultural industry might now be of great help to the Country.

To show the extremes to which the public went I would instance the flotation of the Tanjong Malim Rubber Company. Some years before old Towkay Loke Yew had been granted a large area of land just outside the town for the purpose of resuscitating the pepper industry and for the added purpose of bringing a number of Chinese families from China to augment the inadequate labour force in the F.M.S. He was however able to get the arrangement altered in favour of planting up rubber. A year or so later his financial advisor Dr. E.A.O Travers - who had retired from Government suggested the Estate might be floated. My brother and I were put on the private list which meant we would obtain all the shares we required. The company was floated in London in £1 shares with 7/6 paid up. I am of the opinion that London got the estate mixed up with a estate in Java known as Tanjong whose shares were quoted as 26/- for the day after the floatation the new company’s shares were also standing at 26/-. Needless to say we as did others in K.L also on the private list sold out.

On another occasion my brother happened to be walking past one of the local sharebrokers and was called to ascertain whether or not he had any Singapore Para shares for sale. He replied that he would go back to the office to see but instead went to the competing firm of Brokers and inquired whether they had any of these shares for sale and was able to obtain over a thousand at a price considerably less than that which the first firm had offered. Result a quick turnover taking a matter of 10 minutes and a very handsome profit.