In Chapter 28, the historical timeline started with Don Miguel Jose Ossorio’s plans to set up a centrifugal mill in Manapla after his visit to Negros Island. In the book “Victorias – A History in Pictures”, published by the Victorias Milling Company, Don Miguel recounted on March 1, 1950, the year he turned 60, the origins of his sugar mills. In this Chapter, I share that story as told by Don Miguel himself while adding notes of information and explanations for better understanding.
This is Don Miguel’s story:
When Don Miguel was working as a director of Hogar Filipino, a company that provided loans to businesses in the Philippines, they wanted to visit the Negros Island with the intention of providing loans to local hacienderos who needed more capital for their sugar business . This was in 1916 when mortgages in Manila had become limited; they had to explore elsewhere.
So, Hogar Filipino appointed Don Miguel, then just 26 years old, as part of the three-man committee who would travel to the Negros Island; this was his first trip to Negros. The other two men were Don Antonio Melian, the founder of Hogar Filipino, and Jose Reguera, Hogar’s representative in Iloilo. The gentlemen engaged a certain Mr. Blanco to help them appraise sugar estates that would be used as collateral by the hacienderos for their loans. Mr. Blanco was the administrator of Hacienda Progreso in Isabela.
The first prospective borrower was Don Esteban de la Rama, a wealthy haciendero, who wanted to borrow P600,000 by offering 2,500 hectares of his land in Bago and a mill that produced centrifugal sugar. Don Esteban’s two-year old mill was manufactured by Blair, Campbell and Maclean, and was erected by him with the help of his mechanic. Don Esteban also offered warehouses he owned in Iloilo as well as a building next to the Sta. Cruz Bridge in Manila. The term of Don Esteban’s loan was 20 years.
This trip, according to Don Miguel, “proved to be a turning point in my business career” as he never thought about the sugar business because he had never set foot in the Negros Island before. In his meeting with Don Esteban, Don Miguel asked a lot of questions about the sugar business that gave him encouragement and ideas about venturing into this industry. He also learned that the Negros Island needed sugar mills and capitalists who were willing to take the risks of ordering machinery, especially that war was going on in Europe. That time, the local sugar planters were just producing muscovado sugar and were losing money because muscovado was no longer in demand; the world market was shifting to centrifugal sugar.
(NOTE: Most machines for the sugar centrals that time were ordered from Europe, specifically from Scotland, since the 1860s with the help of the British vice-consul, Nicolas Loney, who was based in Iloilo and who saw the potential both in the importation of steam-powered mills for sugar manufacturing and the export of sugar directly from Iloilo, rather than letting the product pass through Manila. He later partnered with the Scottish merchants Ker and Co., naming their firm Loney, Ker and Co. Nicolas Loney, who spoke Spanish, is credited as having modernized sugar manufacturing; the ‘Muelle Loney’ in Iloilo City was named after him. Don Miguel described the machines of Don Esteban de la Rama as having been manufactured by Blair, Campbell and Maclean, a Scottish manufacturer that must have supplied machines in Panay and Negros on credit for decades since the time of Nicolas Loney. World War I, that hampered importation of machines from Europe, started on July 28, 1914 and ended on November 11, 1918).
Mr. Blanco advised Don Miguel that, if ever he wanted to put up a sugar mill himself, the best place would be in Manapla on the northern part of the Negros Island. According to Mr. Blanco, Manapla was ideal because of steady rainfall that would allow the planting of sugar cane all-year round. Don Miguel then asked Mr. Blanco to bring him to Manapla after he was done with his professional duties in Iloilo, where Hogar Filipino also gave out loans to Mr. Guillermo Gomez, a collector of Customs in Iloilo, and his brother, Mr. Felipe Gomez, the chief of police in Iloilo, and Mr. Jose Gan, an agriculturist who received education in the US. Hogar Filipino lent money to this gentlemen for them to buy the hacienda of the Uruquijo Family in La Carlota; the said hacienda was later named San Jose. They also some of their real estate in Iloilo as collateral.
After completing his tasked as an officer of Hogar Filipino and after he was left alone in Negros Island by Don Antonio Melian who went back to Manila, Don Miguel went to visit Manapla with Mr. Blanco. While staying at Hacienda Bilbao owned by Don Benjamin Gamboa, Don Miguel on horseback visited Hacienda Begoña that was recently purchased by Ruperto Mendieta and who was building a home there, and Balolan where Don Miguel eventually built a wharf in 1918. During these visits, Don Miguel was learning everything he could about the sugar business and was envisioning his plans for planting sugarcane, milling them into sugar, and finally shipping the finished product out of the Island to be sold.
(NOTE: Don Miguel must have stayed at the home of Don Benjamin Gamboa where he later built the Gamboa Mansion; read link below to read about the burning of that Gamboa Mansion by the retreating Japanese soldiers on the last months of World War II).
Don Miguel also visited three muscovado mills in operation during his ‘educational tour’, some of these visits were during September’s drizzly weather. Some mills he tried to visit were shut down as the milling season then started in December and ended in May. And as early as this visit, he asked Mr. Blanco to gather the sugar planters owning adjacent lands so that he could convince them to sign up for preliminary milling contracts to mill on a 50-50 basis for a minimum of 250 days, the details of which were patterned from the contracts used by San Carlos Milling Company that had been in operation for three years at that time. These planters were in need of a centrifugal sugar mill as focusing on producing muscovado sugar, which was now unsaleable, would bankrupt their businesses.
After studying the sugar business and learning all he could during his trip, he immediately went back to Manila and saw the president of the Bank of the Philippine Islands, Don Eliseo Sendres, who actually knew something about ‘Manapla’ because, when Don Miguel told him that he fell in love with Negros Island and was determined to put up a 300-ton sugar mill in Manapla, Don Eliseo’s reaction was positive and agreed that ‘Manapla’ was the place to be. Don Eliseo signified to Don Miguel that his bank would help him in his venture and even wanted to invest P10,000 of his own money should Don Miguel eventually incorporate.
Now having a bank supporting his business plans, Don Miguel went to look for manufacturers who could build the mill. As European manufacturers were out of the question because of the ongoing World War I there, Don Miguel negotiated with a US company, Castle Brothers Wolf and Sons, who were represented in Manila by Honolulu Iron Works, a company that also supplied machines to other sugar mills. The company sent an engineer named Powrie to travel to Manapla in order to draw plans for a 300-ton sugar mill that would include 12 kilometers of narrow gauge railroad, warehouses, and buildings for the mill; these were all estimated to cost P1,200,000. Don Miguel was able to put up P700,000 with the balance of P500,000 to be financed by the manufacturers themselves bearing an 8% interest. On December 23, 1916, Don Miguel signed the order to purchase the machinery at the offices of Castle Brothers.
In December 1917, Don Miguel formally established North Negros Sugar Company, or NONSUCO, in Manapla, and on August 1, 1918, its mill became operational just when the sugar prices began to rise; the prices steadily rose until 1920.
Seeing that Don Miguel’s business was going to be profitable, Mr. Ramon Diaz, his friend who happened to be a bond broker, must have introduced Don Miguel to the management of a new bank, Philippine Trust Company (PTC), which was established in October 1916, in order for Don Miguel to get more capital for NONSUCO. NONSUCO successfully issued a P600,000 bond with 8% interest and a term of 20 years that was then purchased by Philippine Trust Company at 99. (The Philippine Trust Company would later become one of the oldest banks in the Philippines, alongside Bank of the Philippine Islands and Philippine National Bank).
NONSUCO’s P600,000 bonds were later sold by PTC to “the Friars” for 105.
(NOTE: In bond transactions, this means that when PTC bought the bonds from NONSUCO at 99, PTC earned a discount of 1% of the bond’s par value of P600,000. PTC paid NONSUCO P594,000 (99% of P600,000), and when PTC later sold it to the Friars for 105 of the bond’s par value, PTC received P630,000 (105% of P600,000. In total, PTC earned P36,000 from the two transactions of NONSUCO’s bonds).
(NOTE: “The Friars” referred to by Don Miguel must have been the confraternities who ran the Obras Pias, a charitable institution created by the Spaniards in 1827 to receive donations that would be used for charitable, religious and educational purposes. This organization was formally converted into a bank in 1828 but was only established in 1851 as El Banco Español Filipino de Isabel II, or Banco Español Filipino, for short. During the American colonial period, in 1912, it officially changed its name to Bank of the Philippine Islands, or Banco de las Islas Filipinos, and was later privatized.)
A year later, Mr. Phil C. Whitaker, the president of PTC helped NONSUCO issue another bond of P900,000 with a two-year term to finance the doubling of NONSUCO’s milling capacity. This was proof that the banks then had taken notice of the profitability of the sugar industry in the Negros Island and was willing to help provide capital to any sugar mill’s expansion plans, including those of Don Miguel’s NONSUCO.
As NONSUCO’s capacity had doubled, Don Miguel negotiated with the hacienderos of Victorias, courting them to mill their sugarcane with him. The sugar planters of Silay and Saravia that time were sending their sugarcane to the Hawaiian-Philippine Company that also opened in 1918-1919. Don Miguel promised the Victorias sugar planters, that included the Benedictos, Montinolas, Ascalons, Gonzagas, Ditchings, Lopezes, and the Gastons, that NONSUCO would extend its railroad network to the Victorias area in order to transport their produce to the Manapla sugar mill. He also committed that, in case their sugarcane could not be accommodated in Manapla, he would build a separate sugar mill in Victorias for them. This decision of one man, Don Miguel Jose Ossorio, singlehandedly impacted the economic, political, social, cultural and environmental aspects of the town of Victorias.
Don Miguel, in order to convince the Victorias planters, offered them 45-55 contract and the option to purchase 25% of the stock of a company he would establish Victorias Milling Company (VMC). Some of them purchased stocks worth P200,000. Those conditions and the steady rise of sugar prices in the world market forced the planters to expand and plant more sugarcane which worried Don Miguel as to whether the capacity of the Manapla sugar mill would be able to handle the rise in volume of sugarcane to be milled.
In 1920, Don Miguel and wife Paz went to Singapore to bring their sons Miguel, Luis and Jose to a boarding school there. Sending children to boarding schools were popular among rich families, although Don Miguel did not mention the name of the boarding school, except that it was the same boarding school where his mother, Doña Emilia Lapuente de Ossorio, sent him and his brothers in 1898. After Singapore, they travelled to Java, then part of Dutch East Indies, to visit the sugar mills built by the Dutch and compared the ones built by Honolulu Iron Works for him.
In June 1920, Don Miguel placed an order for a “low-type factory” for Victorias.
In 1921, the Bank of the Philippine Islands experienced financial difficulties like other banks due to the declining prices of the commodities they were financing. Due to this crisis, the Bank needed to help of the Philippine Treasury. It was then Governor-General Leonard Wood (this was now the American colonial period) who told the Archbishop of Manila, the representative of the Catholic Church as the majority shareholder of the Bank of the Philippine Islands, that in order to receive the help needed by the Bank, the Archbishop would have to agree to the appointment of an American as its president. The governor-general appointed Mr. William T. Nolting as the Bank’s president.
Don Miguel recounted that his business relationship with William T. Nolting was difficult in the beginning as Mr. Nolting was questioning why Don Miguel’s loans with the Bank reached P3,000,000 and that the loan for the Victorias sugar mill did not even have any collateral.
Although Don Miguel reasoned to Mr. Nolting that his predecessors trusted him and believed that his sugar business would be profitable, Don Miguel had to agree to mortgage the sugar mill assets for the said loan with a term of five years. Stories that Don Miguel later heard were that some of his so-called ‘friends’ told Mr. Nolting that Don Miguel did not know anything about the sugar business and that he did not really need to put up a second sugar mill in Victorias. (This part of Don Miguel’s narration just showed that earning the trust of other businessmen, especially his fellow Spaniards at that time, was an important aspect of doing business, until certain Americans with a different mindset or who did not have an understanding of the culture came along.)
To please the Americans, Don Miguel appointed Mr. Nolting as president (probably just as a figurehead of NONSUCO) but Don Miguel was still the managing director. He then asked his friend, Mr. Alfred Cooper, to sit on the two boards of directors of both NONSUCO and VMC. Don Miguel needed to stay in Manapla for six months in order to make sure both sugar mills were managed well.
It was in 1922 when fertilizer was used and both sugar mills grew and improved their own varieties to increase production in order to be an example to the local planters who were encouraged to follow.
In 1923, the price of sugar reached P15 per picul, and in 1924, the debt to the Bank of the Philippine Island decreased to P3,000,000 after reaching P3,500,000 when the Victorias sugar mill was completed. (In 1926, this debt to the Bank was all paid off after VMC issued a US$1 million bond).
In July 1924, Don Miguel confided to his good friend, Mr. Alfred Cooper, that he wished he could travel to England with his wife, Pacita, to see their sons whom they had not seen in two years, but Don Miguel worried about how he could finance the trip. At this time, the two sugar centrals were practically new in the sugar business and were in debt. Mr. Cooper’s reaction to his wish, according to Don Miguel, “was the greatest act of friendship” ever showered upon him because Mr. Cooper told him, “Your I.O.U. up to P50,000 is good with me indefinitely.” He was willing to lend Don Miguel that amount with no rush to collect.
Don Miguel was very grateful for the gesture and decided not to borrow. Instead, he would sell 50 shares of NONSUCO at the par value of P1,000 that would still amount to P50,000. At this time, NONSUCO’s capital stock amounted to P2,000,000. According to Mr. Cooper, he believed in Don Migue’s business and it was his privilege to be an investor.
Don Miguel took the P50,000 cheque and obtained a letter of credit for US$25,000 which he would use for the trip. (That time, the exchange rate was US$1 to P2.00). Don Miguel then wired Mr. Nolting, who was also on a ship en route to the U.S., telling him that he was going to England with Doña Pacita to visit their sons.
In August 1924, the couple sailed from Manila on board SS President Garfield, taking 35 days to reach Marseille, a seaport south of France. They then took a train from Marseille, probably, to Calais, another sea port but on the northern part of France. From there, they took a boat to England and finally a train to London, where they stayed at the Grand Hotel in Trafalgar Square. In October, they flew from London to Paris on Imperial Airways. This was Doña Pacita’s first flight, and the couple did not enjoy it. (Maybe Doña Pacita suffered airsickness during the flight that ruined her first experience on a plane.) On their way back to London, they just took a train and boat.
For Christmas and New Year’s, they rented an apartment at Kensington Palace Mansions so that they could be with their sons. It must have been a wonderful Christmas for Don Miguel and his family. This was his much deserved break, and probably his reward, for all the hard work and time he put in in the planning, searching for financing and expertise, establishing, negotiating with planters and his buyers, and managing the two sugar mills since 1916.
After the New Year’s celebrations (this was now January 1925), they both traveled to Madrid and stayed at Palace Hotel. According to Don Miguel, this was his first ever visit to Madrid. (His father was born in Spain but Don Miguel was born in Manila.) There, they met up with Señora Maria Alvarez, his father’s widow from the third marriage, who visited them at their hotel with her children, Maria and Carlitos. They also met up with General Manolo Reguera, his father’s old friend and a general in the Spanish army.
Another friend they saw in Madrid was Don Eugenio de Saez Orozco, the former president of Banco Español Filipino, who was a prominent man in Manila. Don Eugenio was now retired and lived with his wife and daughter in an expensive apartment in Madrid that had a chapel. (NOTE: “Don Eugenio de Saez Orozco” was Don Eugenio del Saz-Orozo de la Oz; his wife was Doña Felisa Mortera y Camacho. He was the last Spanish mayor of Manila and a president of El Banco Español Filipino. Their son, Jose Maria, was born in Manila, and became a Capuchin monk, adopting the name Jose María de Manila. He was martyred in 1936 during the Spanish Civil War and was beatified in 2013. Blessed Jose María de Manila is now the third Filipino to have been declared blessed by the Roman Catholic Church. During that visit by Don Miguel to the apartment of the Orozcos – no mention that Jose Marîa was there as well -, they would have never imagined that 11 years later, Jose Marîa would be martyred or that someday he would be venerated as ‘Blessed’.)
Don Miguel and Doña Pacita returned to London in the late January 1925. They then sailed for New York after booking their passage through American Express. Their ship, RMS Berengaria (also known as SS Imperator) was one of the biggest ships at that time. They arrived in New York in early February and was met at the pier by Don Miguel’s business friends, Mr. John M. Switzer, Mr. Webster and Mr. Pond of the Pacific Commercial Company.
In New York, Don Miguel and Doña Pacita stayed at the Pennsylvania Hotel but later moved to Roosevelt Hotel. From there, they made a trip to Havana, Cuba, via New Orleans. In Havana, they were hosted to a lavish dinner by old friends, LTC Harman Agnew and wife, Camille O’Connor Agnew, who used to live in Manila when Harman was still a captain in the US Army. They were frequent visitors at the home of the Ossorios at Padre Faura in Manila.
In April 1925, they travelled to San Francisco by train and were met at the train station by Mr. Alfred Ehrman in a red automobile which he used as an honorary chief of the fire department. The couple stayed at Palace Hotel.
While Don Miguel was in New York, he visited the International Banking Corporation to seek help in refinancing his debt of P3,000,000 from the Bank of the Philippine Islands. He asked for US$1,500,000 but was turned away because the amount was beneath the bank’s minimum of US$10,000,000. In San Francisco, it was the same. Don Miguel and the banker he met with could not agree on the terms.
On their way home to Manila, the ship they sailed on, SS President Taft, stopped briefly in Honolulu, Hawaii. Mr. John Fleming of the Pacific Trust Company met the couple and introduced Don Miguel to the presidents of four local banks to whom Don Miguel presented the financials of VMC and his quest for a loan. These meetings must have helped because in 1926, Don Miguel was able to negotiate with Pacific Trust Company through cable, meaning, through long-distance communications, for a US$1,000,000 bond issue. As Pacific Trust had an office in Manila, the paper work was completed there with the terms of 7.5% interest over 15 years and sold at 95.
Later, when Mr. Francis Greenfield, the manager of NONSUCO, was vacationing in Hawaii, a banker asked him about “Victorias”, meaning the sugar mill. Mr. Greenfield told him that the owners of Victorias were the same owners of the one he was managing and that they always put savings into their stock. These words spread around Honolulu and made VMC bonds popular, meaning, a lot of investors bought the said bonds and VMC was able to get the US$1,000,000, allowing Don Miguel to pay the Bank of the Philippine Islands his loan of P3,000,000, and to finally get William Nolting off his back, so to speak.
(NOTE: When Don Miguel came home that year, a two-day thanksgiving celebration was held for producing the first large crop of 23,743 metric tons. Also, in December 1925, NONSUCO celebrated its 8th year.)
Don Miguel recalled that he finally heaved a sigh of relief when “the day the bonds were signed was the first time I could say I was really out of the woods financially after building the two centrals at Manapla and Victorias.” He was sure then that the two sugar centrals would be able to stand on their own and pay for the bonds, while providing employment for thousands and at the same time, taking care of their families, but most of all, produce the sweetest sugar ever.
This is where Don Miguel Jose Ossorio ended his narration.
* * * * *
Don Miguel’s story above, documented in 1950, happened when the repairs and rehabilitation of the mills, trains, machines and facilities of Victorias Milling Company were already completed. VMC must have benefited from the Philippine War Damage Act of 1946 that created the Philippine Commission that paid qualified beneficiaries, including US$13.1 million to sugar centrals all over the Philippines.
Immediately after World War II was declared over and the rehabilitation started, Don Miguel’s kindness extended, not only to his employees, but also to the sugar planters and their families by letting families live in the VMC compound while they rebuilt their homes that were destroyed during the war. They included the family of Don Felix Montinola whose mansion in front of the public plaza was deliberately set on fire by the guerillas so that it would not be used by the Japanese Imperial Army in 1942. Don Miguel offered the family of Don Felix Montinola to temporarily stay at one of the houses along the so-called Palm Avenue in the VMC compound while their new house in Victorias was being built. Their friendship dated back in the early days of NONSUCO when Don Miguel 'courted' the hacienderos in the Victorias area. At one instance, Don Miguel even offered Don Felix to choose which lands the latter wanted for his sugar plantation; Don Felix declined the offer. (Read the link below about Don Felix Montinola, former mayor of Victorias).
https://apinoyinkorea.blogspot.com/2019/11/philippine-history-chapter-16-don-felix.html
In all my research, readings, conversations with locals, and analyses of the personalities, events, and deeds of the people of Victorias of the past, I concluded that there are a very few worthy of a monument built in their honor and memory. On Chapter 4 and Chapter 6 (links provided below), I concluded that CAPITANA TUTANG and former mayor, ESTEBAN JALANDONI, are worthy of having a monument built in their honor.
https://apinoyinkorea.blogspot.com/2019/11/philippine-history-chapter-6-eliodoro.html
Capitana Tutang was a legend in the 1880s for her bravery and contributed to the story about Nuestra Señora de Las Victorias. Esteban Jalandoni, who came to Victorias on July 31, 1901, to work as the municipal secretary the next day, and finally was elected mayor in 1928, served the people of Victorias and left behind his memoirs that were rich of historical records.
But also during my research, I discovered one classic example of historical negationism perpetrated by the people in position who put up a monument in the Victorias public plaza and approved an ordinance for a person they claimed donated the land where the current city hall and public plaza stand. I found out that the document (the Memoirs of Esteban Jalandoni) that they used to back up the said ‘claim’ is the same document that pointed to the northern banks of the Magnanud River as the exact location of the small land donation. And to get more evidence to prove that I was right, I wrote the National Historical Commission of the Philippines in 2019 about the ‘monument’; the Commission wrote me back telling me that they had no idea about the said person or his monument in Victorias. Let us all be vigilant about these issues that involve our history. Let’s not allow people in position to deceive us with their own version of fake history and use taxpayers’ money to perpetrate it for their own political agenda. (Read Chapter 8 and Historical Negationism on the links below).
Victorias History: Chapter 8
Victorias History: Historical Negationism
Now, going back to Don Miguel.
After having learned about what Don Miguel had achieved as a hardworking and intelligent businessman, a generous employer, a philanthropist and a visionary, I now add DON MIGUEL JOSE OSSORIO to this list.
What he had done for VMC and its employees, Victorias and its people, business enterprises, organizations, schools, religious orders, and a lot more in the Philippines and overseas (that probably we would never know) could never be quantified nor matched by any other Victoriahanon.
He, like Nicolas Loney in Iloilo, deserves a monument standing tall and respected on a cleared plantation in Victorias. While Nicolas Loney is described as the “Father of the Sugar Industry in the Philippines”, Don Miguel is the “Godfather of Victorias.”
In the words of Mr. Claudio Luzuriaga, Jr., “Don Miguel was a fair, kind and helpful man.” A story told by Mr. Claudio Luzuriaga, Sr. was that when he had difficulty paying his loan to the bank for the amount he used to buy his Hacienda Progreso, Don Miguel paid that loan and simply told Mr. Claudio Luzuriaga, Sr. that he could pay back Don Miguel only when he was able to. Mr. Claudio Luzuriaga, Jr. also recalled that during his long-distance conversations with Don Miguel (when he was already retired and lived in Connecticut), Don Miguel would always ask, “What more can I do for my people?” This just shows his mission in life was not to make money; it was to provide, not just employment, but to look after the welfare of his employees and their families as well. Don Miguel lived the words benevolence, generosity, charity, and kindness.
Don Miguel Jose Ossorio’s parents were born in Spain; they were called peninsulares, meaning Spaniards born in the Spanish Peninsula. Since Don Miguel was born in Manila, Philippines, on October 1, 1890, he was an insular, meaning ‘from the islands’, or a Spaniard born in the Philippine islands. Don Miguel was sent to boarding schools in St. Edmund’s in Ware, England, the oldest Catholic school there, and later to the Christian Brothers School in Gibraltar. He married Maria Paz Yatco in 1910, a daughter of Don Luis Ronquillo Yatco, a rich ship owner whose fleet included 148 ships, a steamboat and Chinese junks that sailed to ports all over the country.
Don Miguel’s last visit to VMC was in 1962. He died on October 25, 1965, in Greenwich, Connecticut, USA. He was 75.
Photos and other credits: “Victorias – A History in Pictures”, Mr. David Granada, photographer, Mrs. Mona Magno-Veluz, Mrs. Aurora Delgado, ANC, California Digital Library, Ancestry.com, Duke University, U.P.-Economics Department
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