Ludwig's Wild Amazon Kingdom

ENTREPRENEURS

In their twilight years, some very rich men are content to devote their energies to such sedentary tasks as clipping coupons and collecting Chinese snuff bottles. Not Daniel K. Ludwig. At 79, he is a veteran of seven decades of business; he started at the age of nine by scraping together $25 to buy a sunken boat. Now a restless recluse with a fortune worth perhaps as much as $3 billion, Ludwig continues to expand his shipping-based business colossus into new areas. Besides his National Bulk Carriers, Inc., which with 49 vessels operates one of the world's largest tanker fleets, Ludwig's interests now include ranching in Venezuela, mining in Australia, and resort hotels in the Bahamas, Bermuda and Acapulco.

One of Ludwig's most intriguing ventures is little known outside his 34th-floor offices in Manhattan's Burlington House. In 1967 Ludwig paid $3 million to a group of Brazilian families for a 4,650-sq.-mi. swatch of rain forest in Brazil's remote Amazon region. He then set in motion a bold plan for developing the tract, which is almost the size of the state of Connecticut, to help meet the future world shortages of food, lumber, and wood pulp for papermaking that he expects. Although the crisis has not appeared--at least not yet--Ludwig has quietly and steadily continued to develop what may be the largest private landholding in the Western Hemisphere. Ludwig himself remains inaccessible to interviewers, not to mention photographers. Nonetheless, TIME'S Rio de Janeiro bureau chief Barry Hillenbrand recently managed to tour Ludwig's Amazon empire by Jeep and bush plane. His report:

For the past nine years, under a veil of semisecrecy, Ludwig has spent more than $200 million on his Amazon company, Jari Forest Products, and he plans to lay out another $300 million in the next two or three years. Jari, named for the muddy, winding Amazon tributary that runs through the Ludwig property, is engaged in transforming a vast stretch of virtually unpopulated jungle into a self-contained commercial kingdom. Already it has half a dozen airstrips serviced by Jari planes, hundreds of miles of roads well traveled by a fleet of more than 500 Jari cars and trucks, and a series of towns and hamlets populated by 10,000 workers. The capital of this jungle kingdom is Monte Dourado (present pop. 3,500), a sprawling new community of attractive bungalows, town houses and apartments. A Jari-built hospital staffed by seven doctors cares for the sick, and a Jari school educates the employees' children. A giant service depot stocks nearly $6 million worth of spare parts and equipment so that a force of 266 mechanics can keep heavy-duty machines busy building more roads, more industrial sites and ports, and even a roadbed for a 43-mile private railroad.

Jungle Crushers. Starting a timber business has involved Ludwig in a coals-to-Newcastle operation: cutting down jungle in order to plant new trees. The native forest contains far too many species of trees--more than 300 different kinds on any given acre--for profitable lumbering. At a cost of $250,000 each, Ludwig imported giant Caterpillar "jungle crushers," overgrown bulldozers designed to pull down the natural jungle growth. But these machines proved useless because they damaged the unexpectedly delicate Amazon topsoil. Today one of the jungle crushers stands abandoned and rusting on the outskirts of Monte Dourado. The job is now being done by work gangs using machetes and chain saws to clear the land.

No Time Wasted. The jungle crushers were not Ludwig's only costly miscalculation. In place of the native forest he planned to plant broad tracts of Gmelina, a fast-growing Asian tree that takes a mere ten years to reach the age when it can be cut for lumber and pulp. In contrast, American cottonwood, which is similar to Gmelina in quality and yield, requires at least 30 years to reach maturity. But again the Amazon proved more complex than Ludwig's experts imagined. His property contained at least two distinct types of soil, one unsuitable for Gmelina. Now about one-fourth of Ludwig's first tree forest is being planted in Caribbean pine, another fast-growing variety that can be harvested in 19 years as opposed to more than 50 years for American pine. Says one of Jari's American managers: "Mr. Ludwig doesn't want to waste time with research. He just wants to begin. Naturally we make mistakes, but we also get things done a lot faster."

Despite the mistakes--the list also includes some imported prefab houses that were devoured by Amazon bugs, and a supposedly super dredging machine that got hopelessly mired in Amazon mud--the progress at Jari is extraordinary. So far, about 185,000 acres, an area more than ten times the size of Manhattan Island, have been cleared and planted with Caribbean pine and Gmelina. Viewed from the air, the new forest looks as thick and lush as the sections of old native jungle left uncut along the riverbanks. A wild array of undergrowth, burnt away in the initial clearing, quickly grows back among the newly planted trees.

The forest work has yet to produce a penny of earnings for Ludwig. The first lumber income will not appear on Jari's books any earlier than late 1979, after a $275 million wood-pulp mill, now being constructed on two huge barges in Japan, has been floated up the Jari River and set down on 3,900 wooden piles. By that time, Ludwig's first quarter-million-acre forest will be fully planted, and sections of it will be ready for clearcutting and reforestation. A second forest of the same size has already been mapped out.

But there is more to Ludwig's Brazilian venture than just trees. Jari has diked, drained, leveled, and planted in rice 5,000 acres of swampy land along the Amazon riverbanks. In September the company had its first rice harvest. On the rice project alone, Ludwig has spent more than $20 million for the three airplanes that do the seeding and fertilizing, a fleet of 26 rice harvesters, and a drying and storage facility. By 1982 Jari will have 35,000 acres of rice under cultivation. Single crop yields are roughly the same as in Arkansas and Missouri--about 2 1/4 tons per acre--but the Amazon produces two harvests a year instead of one.

By pure chance--or, some say, typically astute Ludwig intelligence--the Jari property also turned out to contain a rich deposit of kaolin, a clay used in making coatings for high-gloss paper. Huge earth-moving machines are now gouging the white stuff out of an enormous open pit mine and feeding it into a $23 million processing plant that started up two months ago.

Untrue Rumors. The Brazilian government has long pursued its own plans to colonize and develop the Amazon, so far with disappointing results. In a way, Ludwig's project is the realization of this old Brazilian ambition. Yet Jari has picked up an unjustifiedly distasteful reputation in Brazil. Because of Ludwig's passion for secrecy, abetted by Jari's remote location, untrue stories of slave laborers living in hovels have regularly appeared in the Brazilian press. In fact, while they are occasionally exploited by contractors, the migrant workers who make up about two-thirds of Jari's work force frequently return to the operation for another season in the forest. Some of the criticism of Jari may stem from political jealousies. Ludwig and his managers routinely bypass local officials, including the state governors, and deal only with top officials in Brasilia, the national capital.

Jari officials have recently moved to open up the project to outside visitors, especially Brazilians. But Ludwig himself determinedly maintains his cherished privacy. Unannounced, he slips in and out of Brazil on regularly scheduled commercial flights, riding tourist class.

When he is at the project, he stays in an ordinary room at a modest guest house in Monte Dourado and stomps about wearing 25-year-old gray trousers and an even more ancient pair of black dress shoes. He visits congenially with his employees and their families, talking about the future with the energy of a man half his age. Says Volker Eisenlohr, the German-born manager of the kaolin project: "When I first met him 13 years ago, he said, 'Go fast, I only have four years left.' Now he is still saying the same thing." His people, by all appearances, have taken the hint: they are still going fast.

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