CUF, a chemical bond with 150 years

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CUF, a chemical bond with 150 years

CUF – Companhia União Fabril, is one of the oldest portuguese chemical companies still in business. Founded in 1865, producing soaps, stearin and vegetable oils. A story of success, leaded by one man, Alfredo da Silva, that refounded and transformed CUF into a multi interest, vast chemical empire.


 

Panorama

 

Chemical industry in Portugal it’s not one of top major industries, in fact, the vast majority of our chemical industry may be resumed in one short acronym : CUF ; and the vision of Alfredo da Silva

At the year of it’s foundation, chemistry was becoming a more or less well established industry in countries like Germany, England and, France.

It was the dawn of new discoveries and many new substances were being created or leaving the private labs of many great scientists, directly to production and available to all.

Synthetic dyes chemistry, shifted the international commerce for many countries controlling the trade of coloring matters for the textile industry.
New colors like Mauve (W. Perkin, 1856) , azo chemistry development (P. Griess, 1858), alizarin (in 1869) and, indigo (industrial scale, BASF – 1897) changed forever an industry and at the same time creating foundation to many companies still major players in the business like Bayer, BASF, Hoechst (today Sanofi) and others.

As organic chemistry met new and challenging fields, basic industrial chemistry met new production processes, improved and scaled up in order to cope with the growing demand for it’s products.

The time was right for CUF.

 

Foundation

Alfredo da Silva ( ∗30.06.1871 – †22.08.1942) was the son of a wealthy and well established commercial family from Lisbon.
With part of his studies made abroad, the young man soon revealed a particular interest in industrial chemistry mostly due to his high regards towards the German culture and its industrial attitude.

After the death of his father in 1885, Alfredo da Silva returns to Portugal and concludes his studies. By 1890 he leads the administration of the family fortune. Along with numerous interests, he managed also the “Banco Lusitano”.

The main chemical company in Portugal by the 18th century was CAF – Companhia Aliança Fabril (1880). Not a full chemical company but more a transforming factory operating in vegetable oils processing.
Expanding the unit (1883) and production to other areas and fields making use of the available know-how was considered to be an excellent opportunity.

Staying in the vegetable oils business, production was expected to be expanded to soaps and stearin for candles and other uses, thus becoming more competitive.

The production site in Alcântara was later to be known as Fábrica Sol (Sun Factory).

CAF struggled hard to be kept in business, facing ferocious competition from foreign companies, mainly from England and other nearby countries, but also from internal competition from the rival Companhia União Fabril ( of Henry Burnay, and founded in 1865).

Financial situation at CAF became critical with a considerable debt arising, by which Banco Lusitano was the most interested party.

As young administrator of Banco Lusitano, he bought shares of the bankrupted CAF to Banco de Portugal as he saw a good business opportunity in an area that was very dear to him.

By 7 April 1893 in a CAF shareholder meeting where he was called to participate, statutory obligations were asked to be reviewed by the means of a selected committee, named for the task and, of which Alfredo da Silva made part.

Changes in the management board and elections of new members eventually cleared the way for Alfredo da Silva, thus becoming the new manager of the company.

Hopes were kept to a merger between the two rival companies CAF of Alfredo da Silva and CUF of Burnay. This merger happened in 22 April 1898 after a fire that greatly damaged the CAF factory thus precipitating the union of the two companies.

Alfredo da Silva becomes from that date the head manager of the newly merged company – a new CUF was born.

 

The Opportunity

In 1899 Portugal and other European countries were struggling against the invasion of their markets with cheap agricultural products coming from overseas.

Portugal was on the verge of bankruptcy.

The price impact of those imported products was such that the whole Portuguese agricultural sector was in danger, a sector already facing big problems of lack of productivity, disease control and many others, for example, Douro DOC region had been greatly affected by the Phylloxera (ca.1868) leaving many farmers ruined and a fundamental crop completely destroyed.

Economical impact of the wine industry was such that placed the fragile economy in a more aggravated situation.

By 15 July 1889 the government passes a law forbidding all imports of wheat until all the national production stock wasn’t sold. At the same time, payment rights for the imported wheat were substantially lowered, promoting with more money the national wheat and it’s products.

In 1899, by a forced position of Elvino de Brito (minister, 1898-1900), the parliament passes the Lei dos Cereais (Grain Law), setting even higher prices on national grain and,  more import restrictions for the national producers that wanted to buy foreign grain.

Production fields were expanded along with the total farming area. The agricultural boom lead to another growing business that was vital for the first to be successful, fertilizers. Chemical fertilizers.

 

Business Expansion

Alfredo da Silva knew that bigger crops and bigger production yields were only achieved by the substantial use of fertilizers.

Portugal had all the raw materials for their production and in a wise move, Alfredo da Silva starts to seek for a new location for his factory, anticipating the coming expansion in the fertilizer business and other fundamental areas.

The place adopted belonged to a former cork industry in Barreiro, near from Lisbon and with excellent accesses by land, river and especially by rail. Connecting it to the main agricultural area of the country – Alentejo.

In 1907 the new industrial complex in Barreiro starts to be built and in by mid September 1908 the first plant becomes operational.

Brought to Barreiro was also a recently bought textile company, with the aim of providing jute bags for the products made. In the same year, Alfredo da Silva buys the shares that were still in possession of Henry Burnay, thus becoming the major shareholder.

In 1909 the soap and stearin factory Monteiro Santos & Ca. (Porto) is bought by CUF for the purpose of supplying the northern region of the country.

A year later, the Barreiro factory is already a very large industrial complex, producing fertilizers, sulfuric acid, superphosphate, hydrochloric acid and many others.
Supporting buildings, laboratories, medical clinic, metal shops and others were all set in place.

As in many industries of that time, adopting a paternalistic business model, all the infrastructures for it’s workers were also built, namely a worker’s neighborhood.

Later in 1912, CUF invests in the copper sulphate and elemental sulphur productions, two important products for the wine industry and vineyards protection along with the Bordeaux Mixture.

The war period was difficult to CUF as for many others companies, with scarcity of some important raw materials a constant trouble for the production.

In 1918 the Sociedade Geral de Industria Comercio e Transportes (SG) is created. This new company would be one of the major pillars of the group, creating a dedicated transportation system for products and raw materials for the whole industrial group.

Escaping alive to three assassination attempts, Alfredo da Silva leaves the country to become exiled in Spain (1921-1927) leaving his father in law, Manuel de Mello in charge of business management, although coordinated by him.

The business continues to grow, production units for some basic chemicals are expanded, namely sulfuric acid expansion, chlorine, copper metallurgy, lead metallurgy,  pyrite roasting for the sulfuric acid production and for the steel making industry and so forth.

In 1929 the state launches the so called Campanha do Trigo (Wheat Campaign) aiming : increase production, expand agricultural areas dedicated to cereals and, self-sufficiency. This campaign would be embraced by CUF as it was with Lei dos Cereais, expanding even more the fertilizers business.

By the 30’s, the areas of interest would start to differentiate to five main segments : Organic Chemistry, Inorganic’s , Metallurgy , Metalworks and Textile, with production facilities in Lisbon, Barreiro, Alferrarede, Soure, Canas de Senhorim and, Mirandela.

The importance of the fertilizer business will accompany the group during all it’s existence. Much more later, in the 80’s, the business unit would be subject to a series of investments and loans from the World Bank, aiming the development and growth of this important area, by expanding Ammonia production, Nitric acid and Urea.

Fertilizer expansion project was started in 1982 with major financial supports and entered full scale operation by the end of the decade.

The company would keep it’s organic and financial growth throughout the next decades, reaching it’s top performance by the 70’s where it represents about 5% of the internal product.

It’s the major industrial group in Portugal, employing about 110.000 workers in it’s 100 different companies operating under the same brand and with an impressive product portfolio.

In 1974, political changes brought an unexpected end to CUF, with it’s extinction in 1975 and, incorporated in 1977 as a state fully owned enterprise – Quimigal – Química de Portugal,

The name CUF was never used again until it’s rebirth in 1997, starting a new and ambitious future, never forgetting the solid and proud past.

 

Final remarks

CUF group and it’s history is far more vast and rich than the one described here. The purpose of this article is mainly to make reference to The most important chemical group that existed in Portugal.

Despite many changes, socio-political, cooperative structure and business itself, the group has never met any other portuguese chemical company with a more robust background and know-how.

From a simple business to a source of knowledge, the group has always found strength and capability to reinvent itself and overcome any difficulties found along the way.

Today the company is a multi-services, multi-interests conglomerate with interests ranging from the chemical business to healthcare and nano materials.

Like the mythological Phoenix, CUF will always reborn from it’s past and regenerate itself to a brilliant future.

 

 

Col. Estúdio Horácio Novais I FCG- Biblioteca de Arte e Arquivos, reproduced here under written authorization agreement.

 

 

By |2018-09-21T21:46:01+00:00February 16th, 2018|Industrial Heritage, Portugal|0 Comments

About the Author:

Pedro Mendonca, born in Lisbon at December 3 of 1972, studied Organic Chemistry, with a passion for photography and architecture , mainly focusing his written work on industrial history and portuguese industrial heritage.
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