The Profitability of the Early Nineteenth-Century Palm Oil Trade

Abstract

Their large capital in ships, goods and experience gave them monopoly of and profits, wrote Charles Livingstone, British Consul for Bight of Biafra, of British traders in early 19th century West African palm oil trade.' Livingstone's view of enormous of in years before establishment of steamship service in 1852 changed its structure echoed that of other observers, most notably that of representative of W.H. Fisher & Co. who wrote in 1860 of the colossal fortunes made by Europeans out of African trade before middle of century.2 Most historians, however, have tended to be sceptical of such claims. The first academic study of oil trade--Stilliard's thesis of 1938--stressed how high costs of made large profits unlikely.3 This view was also taken by Drake, who stressed how long-term ravages of with Africa meant that risks of were high and that few firms survived in it for long.4 Equally, John Latham, most eminent historian of palm oil in recent years, and only one to address Livingstone's claims directly, has argued that profits of trade, at least before 1860s, were a myth. The risks of trade, as well as costs of shipping, depreciation, insurance, port dues, wages, comey, goods, ceremonial breakfasts and dashes, feels Latham, make it unlikely that excessive profits were made.5 Only Gertzel, in her study of John Holt, has taken contrary view, seeing, like Livingstone, early years of as an era of large profits for British traders.6 Which of two views is correct: that of Consul Livingstone at time or that of most later historians? What is notable is that no one has tested either view against hard data, largely because of absence of such evidence. It is aim of this paper to examine profitability of palm oil between West Africa and Britain in period before 1852, focusing predominantly on Bights of Benin and Biafra, center of and area Livingstone and Latham used as basis of their judgments. This analysis has wider ramifications than simply an examination of profits for their own sake. Profits, after all, are central to any business