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UNITED STL.TES DEPARTMENT CF AGitICLTRE
Bureu f Agricultiial Ec
C-66 '"ORLL COTTON PROSPECTS 1/ J.nu.'; 1, 1. 1
Cotton prices were gunCr-:lly stLble during thl past anrnth, the
fluctuations being within rather narrow limits. Prices of ilmpicrtc-d grv:ths
cf cotton in Livtrpjol from Decembor 19 tt. January 16 rm.Fde ndvnncos r'..ni ng
from 0.12 cents (for Indian cotton) to 0.71 cents (for Egyptian Sakellaridis).
I American middling a.dva.'ced 0.18 cents per pjund. Futures contr..cts fir
American cotton at Keiv York, New Orleans, and Livcrpuol rn-.de not gains of
from 0.08 to 0.64 cents per pound December 15 tc JLnu-ry 14, with the
American markets showing considerably more strength than the Liverpool mn-.rKt.
The greatest gains in the New Yrk and New Orleans markets were made in
The world visible supply of all cjtt',ni on J..nu.ary 16, 1931 was3 about
1.8 million b",les above the corresponding date last year. The visible supply
of American cotton was 1.9 million balts ab-ve last your vhile -ther cotton
was about 100,000 bales below llst year. Exports .f dom-stic cotton for the
first five months this season were about 216,000 b:.leb bulo0u ikst se:Lson
while experts 3f cotton from India so far this season are about 255,000
bales above last season. Expurts from Egypt are running below last season.
S American cotton moving int. sight during Dlucmbur amonuntud to -nly 1.6
million bales and was the lowest fzr the m-nth of' "LhembLr since 1922.
Receipts at ports in the United States, d-mustic mill takings .nd vr-
land movement during December were all belzw December, 192-3. Stocks at ports
and interior towns .t the end of December, however, were 1.9 million bales
above a year earlier.
i7 With special summary cf The Egyptian Government's cutt.;n policy.
Domestic consumption of raw cotton during December was only 9,000
bal.es below November, whereas the average decrease during the past three
years from November to December amounted to 85,000 bales. The rate of
consumption so far this season, however, has been very much below recent
Production of standard cotton cloth was about the same as in
November after adjusting for seasonal. Sales and shipments of cotton cloth,
however, were below November whereas on the average, sales during December
are above November. The decrease in stocks of goods on hand during 1930
amounted to about 97.1 million yards or 21 per cent but unfilled orders at
the end of December were about 33 per cent lower than a year earlier. In
Great Britain textile activity was about the same during December, but the
lock-out of 180,000 weavers about the middle of January has altered the
situation. The activity in the cotton industry in continental Europe has
shown no material change during the past month, but some improvement is
quite generally expected during the remainder of the current cotton season.
Production of both yarn and cloth in Japan increased during December
compared with November. This was the sixth consecutive month in which
yarn production has increased and the production in December was 19.2 per
cent above last July. Spinning operations in China continue active and in the
Japanese section the mills continue to be sold out well forward. The new
piece goods tariff is expected to stimulate the weaving industry which in turn
will improve the situation for higher count yarr.s. This is at least partly
offset by lower silver prices which are favorable to the use of Chinese
cottons rather than American.
- 3 -
Prices of spot cotton have been rather steady during the past month
a general tendency to advance. From December 19 to January 16, the price
of American cotton advanced 0.41 cents per pound in the ten markets and
in Liverpool advanced 0.18 cents during this period. Of the other impor-
tant growths some advanced more and some less than American during this
period in the Liverpool market, with advances as follows: Egyptian
Sakellaridis 0.71 cents, Egyptian Uppers 0.51 cents, Indian Sind and
Oomra No. 1 0.12 cents, and Brazilian and Peruvian 0.18 cents per pound.
On December 15 the price of American middling seven-eighths inch at the
ten markets averaged 8.58 cents, the lowest it has been this season and
on that date the average United States farm price was 8.7 cents per pound.
Since the middle of January spot prices have continued to improve.
Futures contracts for American cotton in the Now York, New Orleans
and Liverpool markets made net gains in the active months ranging from
0.08 cents to 0.64 cents per pound from December 15 to Januar; 14. The
tvro american markets wore so.newhat stronger than Liverpool, the range of
advance for each market being as follows: New York, 0.43 to 0.64 cents;
Nuw Orleans, 0.49 to 0.58 cents; and Liverpool 0.08 to 0.34 cents per pound.
Stocks and Movement
7orld visible suWply
The visible supply of all cotton on January 16, 1931 amounted to
about 9,954,00C running bales compared with 3,117,000 bales a year earlier,
according to the Commercial and Fi :_ncial Chroniclo. iTh visible supply
of American at this time totaled 7,714,000 bales against 5,777,000 bales
last year. Stocks of mecric .n cotton in European pcrts .:nd afloat for
Europo amounted to 1,888,000 bales compared with 1,803,000 bales on the
corresponding dato a year ago or an increase of only 85,000 bales compared
with an increase in stocks at ports and counted interior towns in the
United Sta.tos of 1,833,000 bales. The docreaso in the visible supply of
foreign cotton was due largely to a decrease in stocks at Liverpool and
Bombay, although this vws partly offset by the 252,000 bale increase in
stocks of Egyptian cotton in Alexandria.
Exports of AmEricn cotton
Exports of domestic cotton during Decerbor amounted to about 766
thousand running bales, compared with 910 thousand bales during December,
1929. Total exports for five months ending Decomber 31, 1930 amounted
to 3,947,000 bales or 216,000 b:.lcs below the corresponding period last
season. Franco is the only important concumor of Jmcric..n cotton to which
exports this season have been above last season. For the first five
months this season, exports to France totaled 641,000 b-;.lcs, compared with
536,000 last season, or an increase of about 105,000 b'.los. Exports to
both Italy and Japan for the season are over 100,000 b..ls blow last season.
Exports of foreign cotton
Exports of Indian cotton from August 1 to January 15 this season
amounted to 1,452,000 balos, or an incrtcse of 255,000 bales and 209,000
b-lcs, rospectivoly, above the corresponding periods the past season and
the season before, according to the Commorci'.l and Financial Chronicle.
Exports to Gro:;t Britain were considerably above those in either of the
two previous seasons as wore exports to J.pan and China. Exports. of
Indi..n cotton to the Continent, however, were below the two past seasons.
From r.ugust 1 to January 14 exports from Alexandria, Egypt, amounted
to 419,000 balcs, comp-ired with 484,000 b:alcs and 533,000 during 1929-30
and 1928-29 seasons respectively. The Continent and India have taken
more this season thnn during the tvwo previous seasons, whoreas exports to
Groat Britain and America were considerably below last season and the
Into sirght._Dort roccilts: mill takings, otc.
.mcoric'in cotton moving into sight during December amounted to about
1.5 million b .ls comp .rcd with 2.1 million balcs during Pccomber, 1929
and 2.3 million b .lcs Doc-mber 1928 and was the lowest for the month of
Ducciber since 1922, according to reports of the Now Orleans cotton exchange.
This was probably due to the fact that producers .Ire holding cotton for
higher prices. Receipts at ports in the United States during the month
of September totaled about 967,000 b:ilos compared with 1,157,000 in Decem-
ber, 1929. Overland movement, which amounted to about 122,000 bales during
December, was 33,000 ba.lcs loss th.:n in December, 1929. Mill takings wore
likewise bclow December, 1929, amounting to about 811,000 bales compared
with 1,015,000 bales. Stocks at ports and interior towns at the end of
December ,orc 6.6 million bales or 1.9 million bales above a year earlier.
Stocks in consuming establishments, otc.
Cotton on hand Docember 31, 1930 in domestic consuming establishments
amounted to 1.7 million b.les compared with 1.8 million at that date in
1929. Although imports of Egyptian cotton so f.-r this season are about
75,000 bales below last season, stocks of Egyptinn cotton in consuming
establishments ":t the end of December mountedd to 70,000 bales or only
about 2,000 baloo below a ye.r oa.rlier. Stocks of other foreign cotton
vwncr about the same as at the close of 1929.
The consumption of raw cotton during December, which amounted to
406,000 bales was 9,000 b,..los below November. This compvcs with an average
decrease during December, compared with November, of 85,000 bales during
the past three years and an average of about 33,000 bales during the past
10 years. The low rate of consumption during the first five months of
this season ha:s resulted in total consumption of 2,012,000 bales against
2,738,000 b,:los during the first five months last season. This is equal
to an average monthly rate of consumption of about 402,000 bales so far this
season comp-rod with 543,000 b-.los during this period last season and an
average rteto of about 481,000 b".lcs during the l:.at scv.i months of the
past season. The :'.ckly nvorageo production of st.-.nda.rd cotton cloth uhr-
ing December which .mounted to -15.8 million yards was 4.9 million yards
bolo- the average during ilovmb:r and compi.r:s w:.ith a decroasc during
December, as compared with Novmnbor last year, of 8.1 million yards and a
decrease during thz past throe years of 4.2 million yards, accordingg to
thi Association of Cotton Toretilo e.1rchants, Now York. From this it would
soem that the activity in this jhaso of the industry was about equ.-l to or
slightly bolo- ; November lhen adjusted for scason-:. Tho -*c kly o average
sales of cotton cloth during December on the other hand decreased 9.3
million y.rds compv.rod with November whncrcas during the three previous
years there has been :.n uvcrago increase in Doccnbor over ilovcmber of 13.0
million yards. Shipments likew:.ise docreased slightly more than the average
of the throe ye..rs 1927 to 1929. Tot:.l production of cotton cloth for
the calend-r yc .r 1930 r-.ounted to about 2,818.6 million y:.rds. This was
738.7 million yards or 21 per cent below production during 1929 and
1,744.4 million ya-rds or 38 per cent below 1928. Although shipments "ore
bolow. last year those wcre above production for the first year since 1926.
This resulted in i. decre:.se in stocks on hand of about 97.1 million yards
or 21 per cent from the end of December, 1929 to the end of December, 1930.
Unfilled orders at the end of December on the other hand :vcre 142.1 million
yards or 33 per cent lo.-.er than a year earlier.
The cotton textile situation in Great Britain at the end of Docember
was about the s:.am as a month earlier, but a lock-out among the weavers on
January 17 makes the outlook snmo.-'h..t uncertain.
The o ::orts of cotton *icco goods during December amounted to 130.2
million square yards compared w.'ith 130.3 million during November. During the
past-ton years exports of pizcc goods for December have averaged about 26
million squ:.rc yards belo':- November, and in only three of the ton years woro
exports in December above November. Therefore -.hen adjusted for seasonal,
t'ore vwas some pickup in December in oxports of cotton piece goods. Exports
during Jr.nua.ry may be expected to show- some seasonal improvement at least, for
during the past ton years Janu.ry has been above December every year except
throe and has averaged about 30 million square yards above December. :Eports
of cotton yarn during Docem:bcr wcro 11.6 million pounds or 0.6 million pounds
above November. The sonson-.l relationship betwoi. November December, and
January _re about the same as in the case o'f piece goods, December avoranging
bolo:; Novombcr r.nd January slightly above December.
The lock-out of sore 25,000 weavers in Burrley .which took place January
12 has boon extended and it is cstim..tcd that 180,C00 operatives are now locked
out. The :e-navers' union h:.s refused to give the leaders authority to negotiato
a settlement, according to a c.ble from agriculturall Attache Foley at London.
He also states that 20,000 noro notices will be effective.within the next few
days. In view of this trouble it seems probable that the Government will in-
tervene. Although the strike h.'s potentialities of becoming vory important
with respect to the textile trade of Gr:a.t Britain, the availability of looms
in other countries for turning out cloth for world trade minimizes the influ-
ence of the strike on the :.'orld cotton situation.
Continental Europe' /
In many respects, the prospects for 1931 on the Continent are similar
to those prevailing a year ago, when, after a year and a half of steadily
declining activity in the cotton textile industry, accompanied by a steady
fall in raw cotton prices, conditions appeared to have reached a point where
some revival in demand could be looked for. Cotton prices proved not to
have reached bottom, however, and continued rapidly downward as the gener:'l
business depression developed, with the result that Continental Europe took
nearly 15 per cent less cotton in the year ended July 31, 1930, than in
the previous year, and at prices averaging about 15 per cent lower.
The situation this year differs from that of a year ago in one very
important respect, the price level appears to be touching rock-bottom when
looked at from almost any view point. For the other factors, the level of
spinning mill activity is slightly below that of a year ago, goods stocks
in distributing channels are fully as low or lower than last year when
stocks were reported as reduced, raw material stocks on the Continent are
slightly higher, and the general order situation is not much different on
the whole. 'Thr purchasing power of consumers in Europe ha-s undoubtedly
decreased matcrially since a year ago, but textile prices have dropped and
seem likely to drop enough more to offset largely any further reduction in
consumer wages income. The tendency of general business conditions is
still downward, as it was a year ago, but optimism bout a turn for the
better is less evident yet probably better founded than at the beginning
of 1930. Lst year, from beginning to end, was one of reduced activity
and turnover in the cotton industry and trade; 1931 starts low but seems
likely to work to somewhat better levels for the industry before the year
There are some general indications that the cotton textile industry
and trade on thu Continent have now worked back to a basis that will
result in a relatively more stable r-.te of raw cotton consumption in the
future than has prevailed up to recent y6Ers. Briefly stated, it appears
that the periods of feverish mill consumption of cotton in most continental
countries in 1925 :ind from late 1926 to 1926 were exceptional and not very
likely to recur. They represented to a considerable extent production
destined to fill up the slack in consumer and trade stocks that still
existed from war causes as well as to supply current retail demand. Gener.-lly
speaking, stocks in distributing channels and the hands of actual consumers
were replenished during those years and may now be described as "not far
from normal on the basis of demand in recent years" though recent slack
trade demand h.s apparently reduced them to somewhat below such a conception.
This fact seems likely to remove one of the major causes of the rather
violent changes that hE.ve occurred in continental cotton goods production
in the past several years. Actual figures on stocks of cotton goods are
nowhere available in Rurope, but an analysis of certain indices of retail
textile sales and cotton mill production points to thesu broad indications,
at least for Centr-.l Europe and the territory within thu competitive sphere
of these countries. These facts are of interest a.s having considerable
bearing upon what should be regarded as a normal rate of mill activity
1/ Based on report dated January 7, 1931 from Agricultura.l Attache' L. V.
Steere %t Berlin, suplimented by cable January 17.
and raw cotton consuL.iption on the Continent in years to come. The average
annual consumption of cotton in J>rmvny, for .xamp'l, will probL.bl- bt
lower in years to comu than thu hi-h =vl-le of mill activity in 1925 and
1927-28 have led many people to tx:pect, and the s.-mn is true of other
continental countries also.
The following data, while r~l-ting to G.-rmany, -rc buli:vud indicative
of the tendencies in a l.rbe .rt of th; Continent ..round CLntr:'.l Europe,
but are probably not applicable to France.
Table 1.- Indices of cotton textile distribution in Gdrminy.
Item 1925 1926 1927 1928 1929 1930
Retail Clothing Sales (Value
1925 = 100) .. 100 : 95 : 103 : 106 :98-102: 90-93
Sales of all textiles (Value ::
1925 = 100) 1/......... 100 : : 104 : 114 : 111:2 105
Estimated volume of cotton : :
Textile Sales : : :
(1925 = 100) .............. 100 : 96 : 100 : 103 : 99: 94
1/ In German Department and l.rgt specialty stores.
The relatively small fluctuation in sales of cotton textiles results
from a less elastic consumption because of the "necessity" character of
most cotton goods. Cotton goods consumption from 1925-1929 on thz average
was probably not far from what may be regarded as a normal rate, so that
the figure for 1930 represents a considerable decline, one due to decreased
purchasing power. It is believed, however, that expected reductions on
retail textile prices and, later on, improvement in genrir.al economic
conditions will prevent further recession.
Since the period 1925-1923 was taken as near normal, on the cver..ge,
for retail distribution of cotton goods, a coi-iparison with mill production
of goods over the same period will give indict ions of thu movement of goods
stocks in trade channels in those years.
The index of production used below is based upon raw cotton con-
sumption in Germany, Czechoslovakia, Austria, I'ol.nd, Hiungry -nd Switzerland
(1924-25 1928-29 = 100)
Table 2.- Indices of cotton textile production :-nd distribution.
Item .1924-25 :l25-26 1926-27:1927-28: 126-29:1929-30
Production 89 87 109 117 100 93
Cotton Textile Salts : :
(Cal. year) : 100 : 96 : 100 : 103 : 99 : 94
Large reduction : LIrge rise : Smin.ll reduction
of stocks :in stocKs : in stocks, to perhaps
The changes indicated in stocks level are about'in line with
textile trade reports during the period to which the figures refer, but
were apparently not .s great in extent as the reports often inferred. The
figures seem to indicate, further, that mill production could still decline
to some uxtont, though on the other hand, t:.e relatively important drop
in retail distribution indicated for 1930 and the prospects for reduction
of cotton goods prices give ground for belief that a revival inthe quantity
of cotton goods consumed is just as much within the realm of possibility.
Another indication of the dc.ta is that the level of raw cotton consumption
attained in 1926-27 and 1927-28 cz.n hardly be expected to recur, unless
conditions should develop which would result in a renewed exhaustion of
stocks. If a period of high mill activity should Come -.bout becz.use of
extremely low cotton prices, or for other reasons, it would undoubtedly
raise gods stocks in trade channel, materially above normal levels and
be reflected in a sharp curtailment of mill operations in the industry. It
would appear that a normal rate of raw cotton consumption in Central
Europe is about equivalent to: th:t prevailing in the season 1928-29, which
was distinctly below the levels in the two preceding ye-.rs,
Available dat.: do not pLrmit the drmaving of definite conclusions
regarding stocks of cotton textiles in the other important cotton textile
producing countries on the ContinLnt, parti.cularly.'rance and Italy,
Reports from France during 1930, however, have indicated some tendency for
cotton goods stocks to accumulate, though the rise has probably not been
large. The situation in France in the past two years has had some.
similarity to the two years 1926-27 -:nd 1927-28 in Germany, except that
levels of activity in the French industry have nit been as much above
normal as German operations were -t that time, Mill consumption of
cotton in France does n't normally fluctuate greatly from year to year.
In Italy, the cotton industry has been cnternding with forced retrenchment
throughout 1930. A reduction of stocks of products held by mills has
occurred during the year after a steady rise during 1929, and it seems
probable that similar developments have taken place in the textile distri-
buting trade. Conditions in Italy during. 1930 h.-ve resembled those Lf
1929 in Germany to a marked extent,
Table 3.- C)tton: Continr.ntul mill consumption ;f all kinds,
by countries, 1927-28 to 1929-30
Country : 1927-28 : 1928-29 : 1929-30
:1,000 bales : 1,000 b.les: 1,000 balts
:3f 500 lbs. : f 500 ls.: of 500 lbs.
Germ-.ny : 1,564 : 1,35 : 1,292
France : 1,169 : 1,212 : 1,155
Italy :935 : 1,017 :967
Czechoslovakia : 542 : 487 : 44
Belgium :380 : 4U5 : 402
Spain 406 : 397 : 400
Poland :3568 254 : 222
Switzerland :137 : 122 : 118
Holland 175 :182 :194
Austria 160 : 143 : 111
Finland, Denmark : / 295 :273 290
Total 16 countries : 6,121 5,845 : 5,595
Figures o.f the Internttiona], Federation in running bales conve-rted into
approximate bales of 478 pounds net or 500 pounds gross on the basis of
the following coefficients: 1 Indian bale = 8 American bales;
1 Egyptian bale 1.48 American bales; 1 "Sundries" bale = .72 American
bales; and 1 American bale = approximately 478 pounds net, or 500 pounds
1/ An estimate for Hung:'ry included :.s prior to 1926-29 consumption in
SHung"ry was given in "Sundries" countries.
The position Df Americc.n -nd competitive cott.;ns.
Unusually low prices of ncn-Ame-rican gror-'ths, particularly Indian
and Egyptian, have caused rather marked increases in thu consumption of
these cottons at the expense -f American in continental countries in
recent years. The tendency has been particularly noticeable with Indian
growths, in the case of which price relationships have been extremely
favorable and the technical possibilities of substitution for American
greater than exist for Egyptian.
Cotton: 'Continental consumrption of:Indian and Egyptian
in-relation to Aterican and relative prices,
1925-26 to 1929-30
:Indian Cotton : Egyptian Cotton
:Average: Ccn- : Average: Cnsumption
:price :sump- :price of : in per-
: ov-Mar:tibn in:Uppers, :centage
:in per-:per .:Nov-Mar of
:centago;cent.ge: in per- :American.
:of Amer+ of :centage
:iean 1/: Amer- :of Amer-
: ican : ican
:1,000 : 1,000 : 1,000 :Pr- Per-: Per-
:b.les of :bales of, :brles of :
cent : cent : cent :
:500 lbs.:500 lbs :500 lbs.:
1925-26: 3,941 : 856 : 425 : 81 : 23 : 118
1926-27: 4,427 : 690 : 485 : 96 : 16 : 119 :
1927-28: 4,675 : 778 : 478 : 85 : 17 : 117
1928-29: 4,239 : 924 : 506 : 77 : 22 : 103
1929-30: 3,772 : 1,010 : 537 : 72 : 27 .: 100.. :
International Federation figures corrected, including estimates for
Hungary prior tJ 1928-29.
1/ Average quotations for American Seed, Broach, Ccmra and Scindh.
Price relationships between American and Indian growths so far this
season are more favorable to Americ.:n cotton than was the case last year.
It is expected, therefore, that the consumption -if Indian cotton during
the current season will be somewhat smaller, relatively, than l.st year.
Prices of Egyptian cotton were als'5 above last year's parity with American
during the first months of the current year, but have been dropping
steadily since September and fell below last year's parity in December.
It appears likely that consumption of Egyptian cotton in relation to
American will not differ'materially this season from that of last year.
Consumption of "sundries" cotton in 1931, on the other hand, appears
likely to decline because Jf the exceptionally low price of Americ-n
See Tables 5 : Continental mill consumption by growths, and Table 6:
Prices of Indian Cotton in percentage ,f American.
Spinners' takings cf American cotton on the Continent this
season to about December 26 were about 230,000 bales below those of last
year and were especially small during December in comparison with a year
ago. Larger takings are expected in the next few months, and it is
believed that list year's decline in May, June and July will not be repeated.
_ __ ___
Table 5.- CattJn: C.ltinental mill cnsumptiun by gr.jths,
1924-25 t., 1930-31
Season American : Ind:iar. E yptian Sundries Total
:1,000 b.les:1,000 b:.ls:1,000 bales:1,000 bales:1,O00 bales
: f 500 Ibs: -:f 500 Ibs: fi 500 Ibs: :f 500 lbs: .*f 500 lbs.
1924-25 : 3,730 : 894 : : 459 : .116 : 5,199
1925-26 : 3,91b : 858 : 425 : 135 : 5,369
1926-27 : 4,437 : 692 : 485 : 162 : 5,776
1927-28 : 4,680 : 778 : 473 : .185 : 6,121
1928-29 : 4,239 : 924 : 506 : 176 : 5, 85
1929-30 : 3,772 : 1,010 : 53'' : 276 : 5,695
International Federtion figures converted irLcludi.g estimr.ti s f r
Hungary prior to 1928-29.
Table 6.- Ctten: Prices zf Indian in pcrcint'ge :f .msrican 1,
Season :Aug. :Sept. Oct. :Nov. 'Dec. :Jan. :Feb. Ma. ar. :i.y June :July
:Per- :Per- :Per- Per- :Pr- Pr- er- r- Fer- Per- :Por- :er- Per- 'Per-
:cent :cnt c.int c:ent :c nt cent cent cent cent- cent. cent :cent
1926-27: 92 : 90 : 112 : 105 :108 : 86 : 92 : 91 :87- : 8 : 90 : 87
1927-28: 84 : 73 : .85 : 82 : 64 : 84 : 57 : 87 : 82 : 81 : 82 : 78
1928-29: 80 : 77 : 77 : 79 : 78 : 76 : 74 : 73- 72 : 70 : 68
1929-30: 72: 72 : 72 : 74 : 72 :. 72 : 70: 72 : 68 : 67 : 70 : 64
1930-31: 64 76: 75: 77 : 76: 79: :
1/ Average Bremen quotations for fine irid. Scindh, fine mgd. Oornra Ioo. 2,
f. st., fine mgd. Broach, and Americari Seed Ii". 1 (Punjr.b).
Table 7.-Cotton: Prices of Egyptian uppers 1/ in percentage of
Season : Aug. Sept.. Oct.: Nyv. DJc.: J:.n. Feb. :LMar. : r. Ihy :June July
: Per-?er- Par- Per- Per- Per- P er- :Per- :Per- :Per-
:cent :cent :cent :cent :cent cent :cent :cent :cent :cent :cent :cent
1926-27: 107 : 118 : 134 : 126 : 114 : 119 : 113 : 117 : 113 : 122: 127: 126
1927-28: 128 : 118 : 116 : 119 : 115 : 117 : 115: 119 : 124: 120: 114 : 108
1928-29: 105 : 104 : 103 : 101 : 103 : 103 : 105 : 104 : 100 : 100 : 96 : 96
1929-30: 94 : 100 : 97 : 98 : 97 : 98 : 104 : 104 : 100 : 103 : 101 : 111
1930-31: 108 : 116 110 : 101 : 93: 95 :
I/ .-t Liverpool.
2/ Bremen quotations for Strict Middling Americ:'n, 1-1/16" .
Table 8.- Cotton, America: Continental spinner takings specified
Four weeks end- : : :
Four w e 1926-27 1927-28 1928-29 1929-30 1930-31
: Running :Running :Running : Running : Running
: bales : bales :bales : bales : bales
Aug. 1 Aug. 8 : (62) : (89) : (131) : (121) : (52)
Sept. 5 : 317 : 431 : 295 : 232 231
Oct. 3 : 268 : 334 339 : 282 : 276
Oct. 31 457 : 421 427 : 332 : 323
Nov. 28 : 473 440 : 424 434 389
Dec. 26 544 : 475 : 436 : 415 : 313
Total Aug. 1 : : :
to Dec. 26 :(2,141) :(2,190) :(2,052) : (1,816) : (1,584)
Jan. 23 449 430 : 454 : 406
Feb. 20 : 680 440 : 361 : 380
Mar. 20 : 539 : 386 : 477: 364
Apr. 17 : 463 : 401 332 : 304
May 15 : 524 : 420 337 256
June 12 : 443 : 361 : 417 245
July 10 : 516 : 384 : 304 : 243
July 31 / : 253 : 303 : 13 : 163
Total.........: (6,008) :(5,315) (4,877) : (,177) :
_/ Three weeks.
-- -- -
Digest of present situation :.nd outlook in individual countries
Germany has had a very unsatisfactory year in the cotton textile
industry during 1930, and gives little promise of much imprcvmunt in
the immediate future, though some increase in mill activity appears
probable during 1931. Stocks of y:rns .-nd cctt:n g:,ds are c-nsid6red
relatively low, but may not change materially from current levels if pro-
duction -nd rct-.il distribution continue about ccu&.lly restricted, as in
1930. Prospects of reduced retail prices -f cott-n goods, with a
possible upturn in general business in the second half of 1931, afford some
hope f.r revival in the actual vclume of cotton goods consumption in the
Czechoslovakian cotton industries als. cxperienced vury unsatisfactory
operating conditions in 1930. A moderate irprovumrnnt late in :autumn -appoars
tc have been checked subsequently. It is expected that CzechJslovakian
mills will be able to maintain and probably increase upon thu rate of raw
cotton consumption reported in 1930, but th, current tariff war with
Hungary and possible reduction of spindleagu in Czechcslovakia may affect
the actual amount Af cotton consumed. Austria experienced a heavier
reduction in cotton consumption than prob:.bly any .thur country on the
Continent in the season 1929-30, but is expected to increase the amount
used in 1930-31. The capacity Af Austrian mills, h-wevar, has been reduced
by the transfer of spindluage t. Hungry and Yugoslavia as a result of the
effects of the tariff situation. If the Czocho-Hungarian tariff war
continues for any length of ti.ne, Austria will probr.bly cbtain increased
business with Hung-ry. The Hungarian cotton textile industry is well
protected and its capacity far below bcmn market requirements, so that
consumption in 1931 is expected to equal and probably to exceed that of
the past year. Switzurland was considerably affected by the general
textile depression in 1930, but reports indicate expectation of at least
a small improvement in 1931.
Poland The Polish cotton industry has made mr.rked progress in
readjustment of production to sales possibilities in the past year and is
expected to attain a mod.rato incroaso in cotton yarn nnd clhth production
in 1931, oven though domestic economic and foreign trade conditions are
distinctly unfavur.blo. So f-.r as can he judged at the present ti;ea, a
consumption jf raw cotton in 1930-31 equal t, -nd slightly abveo that of
1928-29 is reasonably possible.
France France appears to be faced with a yua.r f sA' in general
business recession which may extend, at least tj a slight extent, to the
textile industry. As the French mills, however, a.re gun.rally well
equipped with the must madern m-chinery anLd enjoy relatively liw wages costs,
and, at the same time, find it necessary a.s a pr-ctica'l matter tu maintain
operations wherever possible in .rdcr to hold thuir skilled labcr, it
appears that consumption of cotton in the new year should n.t be reduced to
an important extent, if at all. The French cotton industry has sh.wn
itself ablu to compete with hthor continental countries in the past two
years of intense competition, and 1931 should not altur the situation.
Consumption of cotton in Italy in 1930-31 is not expected to
differ materially from that during thu season 1929-50 and the same is true
for Holland and Bulgium, though the possibility of a slight reduction in the
latter two seems greater than the likelihood of an increase.
All available information indicates, barring unusual developments,
that 1931 will be characterized by a considerable diminution of Russia's
dependence upon foreign cotton, as a result of the large 1930 crop and the.
further increase planned in 1931. Preliminary reports point to a probable
production in 1930 of 1,700,000 to 2,050,000 bales of 478 pounds as
compared with 1,310,000 in 1929, while the 1931 plans for the cotton
acreage call for an increase of about 45 per cent over the area sown in
1930. This plan, if only partially, carried out, and provided weather
conditions prove favorable, might moan an almost complete removal of the
necessity of imports of foreign cotton on b:sis of thu present L
consumptive capacity of the cotton mills.
hitherto, Soviet cotton textile production has been limited by the
size of the domestic crop and funds for buying foreign cotton, but it now
appears that a stage is approaching where domestic production will cover
internal requirements and even provide some surplus, unless thu number of
mills is increased. Such a contingency, of course, does not seem probable
before 1932 and might not materialize even then. The success or failure
of 1931 cotton production plans in Russia, in any event is Sf nc little
significance in its bearing upon Russia's probable future need for
Russia's cotton textile production plan for the economic year 1931 1/
provides for the manufacture of 3,083,952,000 yards of fabrics cr an
increase of about 20 per cent over the 2,573,240,800 yards produced in the
economic year ended September 30, 1930. It should be noted, however, that
the production plan for 1930 failed to reach expectations by a wide margin,
largely because of raw material shortage. The plan had called for an
output of over 3,281,000,000 yards as compared with 3,091,000,000 yards
produced in 1928-29.
Yarn production in Japan in December amounted to about 84.4 million
pounds, an increase of 2 million pounds over November, according to cable
from Consul Dickovor. This was the sixth consecutive month in which yarn
production has increased and amounted to 19.2 per cent ovur the July
production of 70.8 million pounds. This increased yarn production is due
largely to high yarn prices caused by speculation on Japanese exchange.
These abnormal yarn prices in Japan, together with the low value of silver
in China are encouraging the importation of cheap Chinese yarn. Production
of cotton cloth in December increased over november by 9 million yards.
Exports, however, decreased slightly due to higher Chinese tariff. It is
feared that this tariff will be adverse to the Japanese cotton industry.
1/ Beginning with January 1, 1931, the economic year in Russia will
coincide with the calendar year.
Tn, J.-.pTnese mills c"'intinue to purc-hase onl: sufficient cotton to
cover their y-.rn comrnitmcnts, accordi:n to Consul Dickovcr., There is
little or no buying as yet to r. plcni:;h depletd stv.cks. The buying of
largo quw.ntitics by importers oin s p.cu.l.tion -pnpr-:rs to be ab-land)ned this
year. It is c:p-ccted T'..t the J-p:u,.es mills ",ill t-'ec a million "or more
* blues fD American cotton during t'i 19.30-31 season but purchcscs will
probably bc scp'rated eveol" tl'.-.r ;o-:l.t tl.: ;-.r.. Imports of .mjnrican
cotton in December camuunted to 100,418 bales of 475 pounds net, which was
only slightly in excess of inill rcqui."c~nnts. Imports of. Indian cottrm,
so fa'r this season, r.-.ve exceeded t ose of the sr-ai pe-riod last ;yc..r by
over 100,000 b.les.
Prices of domestic cotton -;d cotton y-.rt in Ihin. ..cve rccc.itly
advanced due to t>ic decline of silver --.u, in the case of r!.w cotton, to
the smiller .rriv.ls, according to a c:.ble received from Agricultural
Commnissioner :Tyhus at Shanghai. The -.dvance in yarn prices, however, has
not been coirno.rable with the adv::-.c in the prices of forcing cotton and
the buying of foreign cotton is triporr.rily quiet. Arrivals of American
cotton h.-.vc been l.rgo. This, togetl- r with commitments, givcs the mills
a supply up to April -it least -nri th= demrnd for Americra cotton at
present is very quiet.
Sin::-inz operations in tlc Japancse o'vn.d ;-.ills are acctive nd.d the
moveme.:t of' y-ar fr;.m mills as well as-t he stocks on .had are quite satis-
factory. Jap-rscsc mills continue to be *sold out .wellc forward. -rad should
be in the Ir.-.rkct again before long for substantial em unts of raw cotton
from th:- curre-nt cropy. There is :: active dLrm-:d for piece goods in
stock, but due to the present r-.te of exchange ani the hih cr tariff,
prices i-n ni.ny lines must cadvancc considerablv before re"laccm-cnts c.I be
made. T1he ni1 piece goods tariff will doubles' stimul:.te the local
weaving in-du;try r.-id consequently the outlook for higher count yarns.
More peaceful civil conditions is -anothler favor:.ble factor in the textile
situation. T.hec new low level of the silver exch-r.ri: is a speculative
factor ini Lte outlook .n;d qs a result of the unfavorale exchange,
requir.me:its for American cotton m.rcy bc cu;rt-iled. [Hig cu.;it yarn
prices m-y be rather slow in adjusti'n, to the loweersilver exch!r.c.
The cotton textile industry in the State of S-o Paulo is in the
most serious situation in its history, according ; to a report from
Assistant Trr.de Coir.aissioncr, J. Ji.:-sor Ivc3 at Rio de Janeiro. *ZT1
industry in t-is State represents approxim-tely 32 per cLnt of the
volume .Id valuc of Brazil's total.
In a mill to mill crJnv.s of sixty of the largest mills inthe State
of Sao Pau.lo ,which represent 87 per cent of the total spindles :.id 80 per
cent of the totrl looms in the Sttec it wars fi;und that on October 30, 1930
only 39 per cent of the total spindles were workinb regularly, 41 per c.nt
were on varying schedules of activity, 17 per cent were either pro.ctically
closed or temporarily closed and the remaining 3 per cent ".rcre inactive
through mills being bankrupt or othcrw:ise involved in financir.ldiffi-
Pra~dIc.tin., crcqo :_..d crQ c...~ adiion rQa3c t
Production The December report on the probable production, acrongo,
c.nd yield : .s.the last report that "."ill be m:ado until the revised estimates
.rc rcle-.sod in MI.y foll~i.ing the final innings report of the Burozu of the
Census. Until that .timn the Dceomber cstim--tcs ''ill remain as the official
figures for the United St:-tos as n whole and for *tho separate Statos. In
vio'. of this fact the nccompan.ing Table giving the probable production
and yield per :-cro for the 193C crop with comparisons is included this month.
From this able it mav be soon that in South Ci.rolina, Gorgia, Flori-
da, .-labLma, "Tnd in th) irrigA.toL region, No-.: ioxico, Arizona, :.nd Californi.,
tho indictitod yields of the 1930 crop arc unusually l:rge vhilo in North
Carolina, Mississippi, Oklahom:.., .rkansa.s, Virginia, Tonnossoc, and Missouri,
the yields arD bolo.; average.
Table 9.-- Cotton: Indicated production a.nd yield per acro in the
United States, crop of 1930 *-.ith comparisons
: Yield per .cr
: Ieft for harvest
State : O-.yoar: : 1930
: '.vorago : 1929 :()-c.ll
1919-1928: : t.J )
:Puund s : Pounds :iPns
V..........: 246 : 25 : 228
N. C.......: 2 .5 : 190 : 33
S. C_......: 175 :179 : 427
Ga.........: 1C4 171 : 15
Fja........: 16 : 145 : 332
o.........: 249 : 08 : 207
Tri0......: 182 17 15
.la........: 14 : 174 : 108
Miss.......: 17 : 22C : 169
L .........: 152 : 103 : 162
To.%........: 155 :108 : 116
0:la....-... 153 : 126 : 10u
Ark........: 167 : 178: 112
11. Mex.....: 3 288 : 333 : 377.
Ariz ....... : 291 : 324 : 361
Calif......: 293 :402 : 443
Other......:3/ 188 :227 : 149
500 2punds gross :-oight balos 1/
S: 1930 crop
L: 1928 cro0) 1929 crop:(Dec. 1 est,
:/ 2/ _.__ :
S1C000 br.los : 1.000 blose: 11000_ baloe
44 : 48 :4
836 747 : 79t
:726 : 30 : 1,C4
1,30 : 1,343 : 1,62
19 : 29: 5C
S147 : 20 16C.
: 48 : 515: 4CC
1,109 : 1,342 : 1,495
:1,475 : 1,915 : 1,SQC
691 :809 : 730
5,106 ,940 : 4,101
1,205 : 1,143 : 900
S1,246 : 1,435 : 91C
88 :90 : 10C
4: / 149 :-4/ 153 4/ 16
: 172 : 260 : 25C
7 9: 6
l/ Not including production of liners which is usually about 6 per cent as.
much as the lint.
2/ Allo':-nces mado for cross 3tate innings.
3/ Less than a 10-year avorago.
4/ Including 30,000 balos E'/,ptian in 1928, 30,000 bales in 1929 and 28,000
bales in 1930.
lit:/ of the crop The quality-of the cotton :.in-,od prior to
Dece-iber 1, 1930 is about the s.nme as th-.t gin-.ed prior to November 1.
As was pointed out last month the :st.ple length of the 1930 crop so far
is better than the 1929 crop, there b,-in., only 13.3 per cent untender-
able due to short staple this year comp-.red with 19.9 per cent last year.
The improvoe'.icAt i;n otaplu is largely in the 15/16" to 31/3 .roup fhich
represe-nts :1.9 :per cr.t of t-ie total this year. This is 6.0 per cent
more th.n' was represented in threat group last :L'r at this time. Thn
grade of 1950 crop is also run-iinj come better than the previous crop.
World production r.nd r.crc-ge
Iote: In this section of last month's rcort there was an error
in the ad.di-tion of one column in the Table. Th.: total cstirn.,ted
production for 1930-31 i:n the 13 countries which h.-.d reported up to that
time waos 22,450,000 bales instead of 24,450,000 bales as was given in
Table 4, pagi 16 of the Deccmber report. The p.rcentcae 1930-31 is of
1929-30 should h.ve been 100.3 instead of Iu9.2. This would have made
the text on pa.ge 15 the second sentence in the first parr.araph under
worldd sum.iair- of production and acre.,::e road, "In the 13 countries the
estimated production this ;e..r is 0.3 (instead of 9.2) per cent above
last year s production."
Rovisoone h'.ve been made in the estii-tes of production in the
13 countries '.' -ic-, reported for tn;: 1230-31 crop since last month. In
these countries u:whch produced C..ut P5 per cent of the estimated world
production last yer. the estimated production this year is abo-ut
22,317,000 br.ls of 478 pounds not or a decrease of 45,000 b-lcs or 0.2
per cent below last yea.r1s production. These estimates aro preliminary,
however, and will be revised from time to time. (See Table 10)
Tice estimated acreage planted to cotton in 13 countries rejorting
to dato (not t-ic some 13 w ich h-,vo reported production) for thec 19L3U-31
crop has b,-cn revis'cd. From the latest :reports the acreage in these
countries is estimated to be 0.5 per cent above last year. The' .crec.
in those rc)untries last year rcprescnted about 93 per cent of the
estimated world total.
Table 10.-- Cotton: x.croago and production in countries reporting
for 1930-31, -tith comnprisons
Item rind country
United States ........:
India 1/ .. ........... :
Russia .............. :
E3 't .** **.**. *. .. -
Ugandt ............... :
LAnglo Egypti'-n Sudan..:
Gr, c' ... .... .. .
S':ri.i and Lebanon.....:
Bulgaria ............ :
c::cl. China.......: 62 500
Production 2/ : b:-.l
United St-.tos ........: 13,033
India 3C / ..............: 3,529
Russia ...............: 9C5
Egypt .................: 1,453
L.cxico ........ ..... 187
Anglo Egyptian Sudan..: 14
C:hosen (Koror.) .......: 20
Grre ce ....... .......: 13
Tar-ganyika ...........: 5/ 8
Union of So. ..frica...: 6/
I -- -- ----~-'~-~1 ---
Sp. in........... ... ...: 3 : 3 : 9 : 300.0
Bulgaria .............: 1 : 3 : 4 : 4 : 100.0
-. gcria ..............: 7/ : 6 : 8 : 6 : 75.0
Tot-.l abov : :
ccntrios ......: 23,051: 22.362 __ 22 317 : 99.8
,st. -:,orld tot-l, :
incl. China ....... :: 26100 : 26.3_00 26 400 :
Official shurcos and Intorn.tion.l Institute of iAgriculturoe
/ Third estim-.to incomplete. 2/ In b::los of 478 poun s not. 3/ First
estimate, incomploto. I4 A-proxinmat mid-point of a rango of reports.
5/ Avoragc for four years. 6/ Loss than 1,0CC b.los. 7/ -.vorgo for
Compilod by the Foreign Service of the Buro.au of agriculturall Economicsri
fro:." the latest available sources.
- 14- 100-0
1930-31 :193l-31 is
irclim. :of 1929-30
acres : ?or cont
45,218 : 98.7
22,964 : 97.6
3,840 : 148.0
2,162 : 113.1
725 : 107.7
463 : 101.5
393 : 79.9
398 : 107.9
27 : 77.1
47 : 195.8
76 : 126.7
14 : 100.0
14 : 100.0
, .' -':** .1
SIt is estimated that 964,000 bales of cotton of 478 pounds net have
been ginned in Egypt up to January 1 according to a cable from P K, iNorris,
Cotton specialist of the Foreign Agricultural Service at Cairo. This ip q
decrease of 111,000 bales or 10 per cent under the 1,075,000 bales ginned at
Sthe Some date last year, and 231,000 bales or 19 per cent less than were ginned
up to January 1 of 1929. Of the total ginnints to January 1, 224,000 bales
,were of the Sakellaridis variety. This is 85,000 bales or 28 per cent less
than were ginned at the same date last season and 145,000 bales or 39 per cent
less than were ginned by January 1, 129. The innings to January 1 of all
other varieties is estimated at 740,000 bales, a decrease of 28,000 bales or
3 per cent under the quantity ginned at the sane date last season and 86,000
bales or 10 per cent less than were ginned by January 1 of 1929,
*The picking of the cotton crop in Punjab, India, is nearly finished,
according to a cable fram thq International institute of Agriculture at Rome,
The crop was normal to below normal. Last season 659,000 bales of 478 pounds
net were produced in Punjab; thu Province producing on an average of about
12 ptr cent of the total crop for the past ten seasons and the range has been
from 7 per cent to 16 ner cent of the total crop. It was estimated in August
that 2,310,000 acres were planted in Punjab this season and the final estimate
last year was 2,496,000 acres. About ten per cent of the total cotton acreage
of India is in Punjab.
There is no doubt that cotton production is increasing very rapidly
in Russia and present information points to a crop between 1,700,000 bales
and 2,000,000 bales for 1930, This estimate is probably sufficiently close
for practical purposes. In setting the Russian crop dorm definitely, however,
one is faced with the problem of choosing from among several sets of figures.
Furthermore, it is necessary to use an estimate for the present crop which
is comparable with estimates for previous crops. a.11 of the figures on
Russian cotton production are from Russian sources orlgirnlly, but the changes
in these figures are of sucn nature that they lead to confusion. lor this
reason it seems well to state in some detail the problem of obtaining figures
on Russian cotton production,
Russian sources estimate cotton production of that country by weight
in terms of unginned cotton. This leads to the necessity of converting figures
from unginnea to ginned cotton, The International Institute of Agriculture
at Rome uses the factor 0.33 for converting Russian figures irom an unginned
to a giruned basis. This assumes that the lint constitutes 33 per cent of
the seed cotton. Mr. I, V. Chernyshev in "Agriculture of Pre-';ar Russia and
U.S.S.R." 1926, page 100, st-ted that there wAs one pound of lint cotton to
every 3-4 pounds of Russian secd cotton before the w.r. According to this
relationship, Russian scud cotton would be ,bout 28.57 per count lint. Although
the difference is not material when the production is aaIll, the hussian crop
is now reaching a size that makes such differences of practical import-nce.
No doubt further attention needs to be given to the factor used in converting
Russian figures from an unginncd to a ginned basis. For the present,hoaever,
it seems desirable to accept the figure used by the International Institute.
The problem of seluctirg a figure- ior Hussi.,n production is illustrated
by the discrocancy of figures for the 1929 crop, I'ornerly, thG International
Institute reported 1,350,000 b-lus as the size of the 1929 crop. In their
most recent Yearbook they published revised Russian figures for the ye
1926 to d.te. In this revision the Institute placed the 1929 op at t
ba.les on the basis of fn estimate in the official Russian Control figur.4.aq -.-
In their October, Novfember -nd iecumber monthly bulletins, however, the
Institute published the estimate 1,225,000 b.les for the 1929 crop. The oqa4
recLnt available figures issued by the St-te Planning Board of U.S.S.R.(Goppiqp)
police the 1929 crop .t 1,310,000 boles. This figure is now accepted by the
Institute. As the Institute's revised figures can now be checked with Russian
official figures, except for a minor discrepancy in 1926, it seems Advisable to
use these as representing Russian production for the l.st few years.
}or 1930 the Gosplan figures obtained both uirLctly and through the
Institute pl-ced tne crop At not less th.n 2,050,000 balbs. This figure ,p
probably too hith. The monthly publications of the Institute for October,
November, .nd December placed the Ruseian crop for 1930 at l,o80,000 bAles,
Last yt ar, as noted, the eArly fiGures were higher th-n the final crop outturned.
.:ith this in mind it seems Drob-ble th-t subsequent nussiAn figures for 1930
r"y be scUled downward somewhat. Probably the 1'-30 Russian crop will range
somewhere between 1,700,000 ..nd 2,000,000 b.les vith the midpoint of this range
giving the most ru-sonuble specific figure.
Table 11.- Cotton: hussian production according to sources,
1926 to 1530
Year :State Pi-nning Bo:.rd :International In- :International In-
beginning :or the U.S.S.h. 1/ :stitute's figures :stitute's latest
Oct. 1 : (Gosplan) :previously used : figures
:Bales of 478 pounds 2/:B-ILs of 478 pounds 2/:Ble9s of 478 pounds/
1926 b850,000 770,000 830,000
1927 : 1,090,000 90 ,000 : 1,090,000
1928 : 1,250,000 : 1,140,000 : 1,250,000
1929 : 1,310,000 : 1,350,000 1,310,000
1930 : 2,050,000 :: 2,050,000
17 rron the "Control figures of National oonory of U.S.L.R. for 1929-30"
-nd "Shifts in the agriculture of U.S.S.R. between the XV and XVI P.rty
Congresses, 1930" and "Economic Life" and ''Soci-iist Agriculture" for
December 22, 1930,
/ Production in ter-as of seid cotton converted to lint by the use of the
factor 0.33 which neans that lint cotton mounts to 33 per cent of the
seed cotton. Hounded to tnu nourcst 10,000 bJles,
bpyciAl surm ry of the Ltypti~n GQvernnent's cotton
The Lpyptian Govcrnment has t.ken actionn in the cotton market a number
of times in p-st ye-rs in an effort to stabilize the price of Egyptian cotton.
Recently they h-va: hAd A. Atdel .;Jhhab Pjsha, Under-Searetury of State make
a study of their whole cotton problem. This includes a study of the effective-
ness of the Governn:nt's activities in the cotton market. The report is
entitled "Mumorundum on the basis of a stable cotton policy submitted to H.E.,
the Minister of Finance". The following is a brief surn-.ry of certain sections
of the report.
The Egyptian Govfrrnent rnde its debut in the field of int rvention
in the cotton n..rket shortly -fter the outbre-k of the world d J r which
caused severe economic crisis in Egypt due lrg;ely to the interruption of
communications, especi-lly by SL-, -nd to the disAppo .r.ncu- of credit, In
order to mt.et the situation, the Govtrmne.nt entrusted to c.rt-in export
houses the power to purchase cotton for Govt.rrni.t-nt ..c-olnt, from smrll
cultiv,,tors "up country". Goon _ftetri_.rds pric'.'s h'c,..n to rise ..nd the situation
No further intervention took pl-ce until 19'1l, for during the ',r,
and for two y:e-rs iftor the .rmistice, cotton prices ..dv.nce-d rather stmAdily
..nd cotton orAduction wvs very profitable. In the per- r-1 price aefltion of
1920 and 1921 the decline of Egypti. n cotton ;..s vury gre.t; the perce,..tge
decline w.AS even grE.ter thbn that of snmrri'-n (mi-dling 7/8 inch), and on
MI-rch 3, 1921 the premium of Lgypti'kn Skkui oVI r ,ncric-n in Liverpool Ws
only 48 per cent. It -:;as soon after this th-t the Egyptian GoverrLmcnt decided
to intervene: the safn neasure w.4s adopted -s At the beginning of the war
and the export houses were again instructed to buy cotton "up country" for
Govrrrnnent account. Soon therefte.r nriccs b.,~-n to rise and tio premium
of Sakul over ,itmric,.n in Liverpool hjd risun to 83 uor cent. In ,pril when
the prices started declining g.in the Govcrnn,..nt decide to enter the spot
market itt int el Bi Lssal --and t cthe end of the month prices h-d recovered
some .nd the premium wiis -bout 8 per c>nt. In L.Ly Lgypti-n cotton declined
while i.meric-n -uvancod and the pr;emiium crop.',cd to 72 per ccnt. Prices in
Junu were irregular though Jm-nricn nd Lgyptian moved together and by July
general recovery h-d set in. The Go'.ernment on t.lis occasion bought 174,000
cantars, or the (.quivilent of 36,055 bAlcs of 478 pounds. (88,000 c-nt.rs or
18,23E b'les from up-country -nd 86,000 c-nt-rs or 17,820 bules it Ali]net el
Bassl) At a cost of 950,000 L. I. (Egyptian Pounds) or Alout '3,822,00.l
On april 22, 1i22, the Council of M:inisters approved the i.Tiniltry
of Finance's suggestion of'intervention on th,. spot market and the I'.inister
of Fin(.nc.e was authorizedd to tJhe the necEssary me-_sures for intervention it
Minet el B1ss-l. The reason -iven for tht irtt:r.tntion At this time XAs that
the price of Egyptian cotton h.d declinr'd rore in proportion to .jnrican than
the st-te of trade or the statistics of the crop uouid justify. On the day
previous to this decision the premium ;..-s 57 per cent. J.ltho;igh prices of
Egyptian rose during ILy there .:'s -. corresponding, rise in AmeurLcn -nd the
premium throughout the month v-ried from 51 to 56 per cent. T;it rise in
prices of Anerican during June .,nd the first h-lf of July w;..s such as to
cause the pronilum to v.Lry between 42 -nd 533 per cent. Pricv-s beg-n to drop
following this and Egyptian suffered nore than ,jn.ric.n rcsu.ting in premiums
from 38 to 54 n(r cent. This intervention w.s of short duration ,nd only
22,864 cantars or 4,538 equivalent bAles iure purchased .t ,. cost of about
140,318 L. E. or Ab-ut 1638,000.
In August 1923 another effort ..'-s mrd( to strenrthen the market .Then
committee of three which h-d At its disposal 500,000 pounds or about
Q2,320,000 began operations at Minet el Bds-sal. The premiums of Egyptian over
american from July 1922 to about this time had been narrowing rather steadily
,nd on June 29, 1923 was only 1 per cent. There was u rise in prices in
September .nd the premium varied between 7 and 13 per cent. Prices in October
were unsteady, but the premium remained fairly steady, varying from 2 to 11
per cent. During the next two months prices fluctuated considerably, but the
premium only varied from 1 to 22 per cent. The amount bought this time was
35,766 cantars or 8,240 -bales and the cost amounted to 272,495 L. E. or about
There was a considerable decline in the price of S-kel in the first
hblf of September 1924 and the Government decided to begin buying again.
Prices rose after the intervention and at the close of the month were well
above the opening of the month. American followed about the same course during
September and the first part of October, but by the end of November the premium
of Skel over imerican had reached 77 per cent. The expenditure of the
Government in 1924 amounted to 72,697 L. E. or about .334,000 for the purchase
of 9,413 c-nt-rs or 1,950 bales.
1925 and 1926
The price of Egypti.n cotton rose in late 1924.and until MArch 1925
.nd on March 19 the premium over 'american was us high as 160 per cent. The
decline in prices nhich follo-;ed lowered the premium to 86 per cent and at
that time the Government again tried to stimulate the market. Prices continued
to decline, however, and by the end of November and December the premium wus
74 and 67 per cent respectively. *ith the additional decline in the beginning
of 1926 the Government increased its operations. ,.t this time the Council
of Ministers issued a statement that purchases At MIinet el Bassa.l would be
increased up to a limit of 500,000 canturs, equivalent to 103,607 bales, and
that t premium of 75 per cent would be uimed at. The operations were continued
to the end of the season in august, 1926, but the price level or the premium
which was desired or aimed at was not reached. Tho only result of intervention
vias that spinners had to adopt a hand to mouth policy, There were 479,815
Qcntars or 99,424 bales bought or took up during this period 1nd 3,095,312
L. E. or "15,823,L40 were involved. The greater part of this cotton is still
on offer abroad. This is the only time the report mentions anything about
what disposition, if any, was made of the cotton bought,
In December 1926 the Government took moisures to stop the decline
in cotton prices -nd announced its intention of purchasing all contracts
offered and of taking delivery of cotton on those contracts. "Jaturtl factors"
caused prices to rise .nd the Government did not take delivery of any cotton.
1929 and 1930
The situation was such that the Government refrained from intervention
in either the futures or the spot market until the decline in 1929 when the
announcement was made in November of that yeor that the Government would operate
in the futures market and would take delivery on all contracts purchased. It
was also stated that the Government did not desire to do more than relieve the
pressure on the market and that cotton taken would not be stored, but would be
disposed of at a favorable opportunity. On November 3, 1929 the announcement
wcs m;.de th,.t the Goverr~nent "-.s t plrirr:h.,er of ~1l November contracts (Sakel)
and of LecumbEr coirtrcts s.As:...iu i) tt llo price of ~7 u.r contract (about
27.26 cents per pound), ,'19 per contract (about 19.18 cents per p.'oud) for
Ash.ouni. A further unnounc-nent on ilove-ber 16 fixed the srne prices for
JanuAry (Sakel) .nd for Febru-.ry (.shW.nuni). The Co:-ittee in charge of the
operations -nnounied on Dece:.Ibrr .a, 1'.: th :t the T.Lrch "nd C'Dril contracts
.iould be bouightt t ;2?.:.0 (2 .76 ctits) aid *19.40 (19.59 cents) respectively.
dnd 7'old demand th..t cotton be t.ndcred. On Februury 23, 1930 it '-js mude
known that in M~y or June All c')ntr-cts of those two months would be bought
at 028 (28.27 cents) fo-r Ly (Stkel) -nd 1,.61 (19.99 cents) for June
(.nshmouni) nid -wo',old t.,?ke delivery ts usul. Ir.striud of ,autters t,.king the
s.~Lrn course ,s in l1926, uviln prices rose <.nd no cotton 4<,s delivered on con-
tract, us viws unticio.,tcd by the Goveriiment the course. of events proved to
be very different uad cotton u .s poured upon the Government from every quarter
until the quantity tukcn reached almost 3,000,000 canturs-or the equivalent
of nt..rly 621,640 b-les of 478 pounds. (The money involved was not given).
.s to tho effect of thesj interventions the report makes the following
"It should be cle..r from he above that the
only effect of the Go; .r:: mnt's intervt. :tion, either
in h,:: snot m ariet or in futures, was in most c"ses
productive ir no better i'sult th.n to perturb in-
dustrial circles rnd to cncour,.-e them to look for
their require,..nts elsewhere. If it happL'nLd that
prices rose Jfter intervention, this was a purely
fortuitous circumst..nce, as is sho>rn by the f-ct
th.t they continue to rise fb'tr th CGovern.ment had
Further, if .Je l1ave out of account 1921, when
the Governrmnt boauht 174,00,0 cntrs (36,0f5 bales) of
cotton, no on:e \will .rgue that the purchase of 22,864
cntrs (4,'?38 bales) in 1922 or of 40,000, cntars
(8,240 b-ules) in 19'3 or of 9,413 c.ntrs (1,J50 balcs)
in 1924 i-s the deciding factor uiich lAd to a rise:
for if it had been, the Governrmnt's purchases in 1920-
1926, amounting as they did almost to double the quantity
bought in the three previous years, or thu amounts
t-ken up in 1929-1930, which went far beyond Any pre-
vision, would d h-vc lifted prices to the 1919 level.
The proof th.At the Government's action did not
produce the effect anticipated is the close rueltion
which nrevv.iled bet..t:cn the rice of E-gy.ptian -nd the
price of jmneric-n: Eypti-n rose in price .hcn Amer-
ican rose, but never *:hen it did not".
The following Tuble gives a brief sumr.ury of the various interventions
including the -mount of cotton bought -nd the expenditures by periods:
T-ble 12.- Egypt: Govermrints interventions in the cotton market;
the amount bought .nd the expenditures by periods
of intervention _/
: Amount bought Expenditures
: :Equivalent bles:E,,yptic.n
: Canturs :of 478 pounds :lbs.(L.E.): Doll.
Beginning of the :(not
dJr in 1914 : given)
Mar.4-June, 1921 :3/ 174,000:3
,or.22-July, 192 : 22,864:
r.ug.-Oct. 1923 : 39,766:
Sept.18-30, 1924 : 9,413:
ILr.192b-Iug. 1U6 : 474 ,815:
Compiled from "Memorandum on the b-sis of stable cotton policy; submitted
to H. E. the Minister of finance, by Uncder-Sec'y. of State, Octouur 12,1930.
j/ The periods are only rough approximations.
2/ Egyptian. pounds converted to dollars at the average rate of exchange
existing during the period.
3/ 88,000 cunturs or 18,235 bales from up-country and 8u,000 cantars or
17,820 bules at Ilinet el B.ssul.
The future policy of the Egyptian Government
It is now felt that the most logical cnd effective way of meeting the
low cotton prices from the standpoint of the Egyptic,. producer is by reduced
production costs. The report points out that prices of Egyptian cotton are
largely controlled by what takes place in the price nf American cotton. Of
the recommend-tions nade in the report the Egyptian Government either has
Adopted or appears likely to .dopt the following recaomendations, according
to P. K. Norris, Cotton Specialist of the Foreign Agricultural Service at
(1) The establishment of an agricultural bank which will provide
loans to producers at a reasonable rate and vill thereby lower the
cost of production.
(2) The reduction of rent on land.
(3) The restriction of the gro.Jing of SAkellaridis to certain
sections of the Delta.
(4) Refrain from buying more cotton at any price.
The b.nk is no.; in the process of being formed. The Government h-s.
instructed the Courts to refuse to lHu.r cses heree the l-ndlord is trying
to collect rent if SO per cent of the 1.350 r.nt has been p-id .nd in case
where less th.n 80 ptr cent h.-s b.-.n nrid to give jud:rient only for .n amount
cqu-1 to 80 upr cent. This is equAl to reduction in rent of 20 per cent.
In regard to the reco:.-endtion purt-ining to -crc.ge deductions the Government
in December issued .. decree nrohibitin: tie planting of Sckel in all but the
three provinces of Ghrbiyi, Buheir., -nd D-q.,bliy.i. In these provinces the
ucre-ge is to be restricted to 40 per cent of the present. Since these three
provinces produce bout b8 per c(nt of the J!:tl the decree if enforced will
me.n that the _re. pl-nted to this vAriety .:ill be limited to about 34 per cent
of the present cre-.ge or ,i reduction of _bout 66 per cent.
The Egypti.-n Covcrnm.iLnt .nd the Cotton Exchanpg-.
The Egypti.n Government unnounccd th.t it will dissolve the Bo.rd
of Directors of the C itton Exch.ng. in clsc the speculators secure control
of the Exchange _t the -nnuAl election n J.nu.ry 26, According to ia recent
c.ble from Mr. Norris. He further states th.t in case the BoArd of Directors
should be dissolved the Exch-nge will be operated by 4 corimittee appointed
by the Egypti-n Governr'ient.
Ij scellAneous ic-.is
Recent bills introduced in Congress
H. R. 1585 by Mr. Cross of Texcs, for the prevention And removal of
obstructions ind burdens upon interstate corLmi-rce in -gricultur-l commodities
by regulating trxns-ctions on connodity exchc.ngcs, putting t st.pp to short
H. J. R.,s. 451 -'by Hr. Jon.s of Tex-.s, to establish a rate-Adjustmcnt
division for the benriit of agriculture.
Extended uses for cotton
In -il the industrial tu'jns of Lnnc-shire, Lngl:~in, efforts h-ve been
and _re buing nrde to popularize cotton by merrs :'f exhibitions, dances,
competitions, (.tc., -cc.ording to reports :n thL mtlLting oi the. International
Cotton Cn.iittee held At BrussLls, Octobur 20, 1U0. This report iaso stated
th-t A joint cuiriittte ,j..s organizing j British Cuttuon TLxtile Exhibition to
take plcL in the white e City, London in rLbrL;.ry. Th"e Lxhibition ;iill be
under the -uspiccs .f the British Govcrrnult ss u si.ction iof the British
Industries .kir -nd w;ill fill eight l.r-Lf h11ls covering 120,000 square feet.
arn,) S. PicrcL in his report to this c.,rn.ittLe pointed out .h-t w's
being done to popularize cotton in Gcrm.ny. He brought to the attentionn of
the coimittue clcnd.r containing d..ily injunction to huuse iivOs of the
possible n-.ow uses jf cotton for clo-thing -nd ,;(enral h.)us;liuid rt.quirLnents.
He :lso submitted Jther cxmnples of ne.' uses such As cotton stfti-_.n(ry ,nd
In connection '.ith cotton statiinery the ne uses section of the Cotton
Textile Institute estinAtes th.t r-ore than 2 nilliion square y-rds f print And
shade cloth hive ..lre.-dy been used in making cotton statiunery since the
introduction of its use about six months Ago.
InternL.tional Cotton Congress, 1931
The 15th International Cotton Congress will be held in Paris June 23-
25, 1931, Various questions and problems will be discussed including "Cause
of the Depression of World Cotton Industry .nd Remedies" and "The Various
Factors effocting the Normal Trend of Cotton Values". The tentative program
indic-tes that some three or four Americans will submit papers on these sub-
Cotton acrLAge reduction
The iameric-n Cotton Cooperative Association and the State Commissioners
of Agriculture of the Cotton Belt held''" conference in Memphis on J.nuary 12,
13, 14 to discuss acreage reduction.
The Southern Cotton Production Association supplementing the activities
of the Federal Farm Board has launched a campaign to bring about a cut of.25
per cent in the acre Age devoted to cotton throughout the Belt according to
the Press on January 16. The fiuld agency of this association, which was or-
ganized in Corpus Christi lust October are touring the south and it is re-
ported that the Bankurs Atssociction of the Cotton Belt have joined the cam-
paign to induce farmers to reduce the acrenge one-fourth below 1930 plantings
for a periJd of five yenrs.
Outlook for American cotton
Bulletin No. 4 )f the Federal Farm Board called "Outlook for..kmerican
Cotton" has recently bLcn released and copies may be obtained free upon re-
quest from thu Director of Information, Federal Farm Bocrd. The statistical
.nd economic facts upon .-hich this statement is primarily b-sed Us well as
the outlook for other southern agricultural products are treated more com-
prehensively in the United States Department of Agriculture Miscellancous
Publication No. 102 and 104 ihich nmy clso be had free upon request from the
Bureau of agricultural Economics. The Fbrm Board's outlook statement deUls
with some phases of the outlook which arc not found in the reports of the
Bureau of itgricultural Economics.
1 World prospects . .. 1 2
2 Pric s . . . 3
3 Siocks and movements . .3 4
4 Textile situation . . 4 5
5 Europe . . . 6 -14
6 Jcpan . .... .14 -15
7 Chin . . . 15
8 Production, acreage -nd crop ccnditicn reports 16 -20
9 Special summary of the Egyptian Govrnmtnt's cotton policy. 20-25
10- Miscellaneous news . . 25-26
1 Indices of cotton textile distribution in Germany 7
2 Indices cf cttdn textile production c-nd distribution .. 7
3 Cotton: ConLtinrntal mill c:nsumpti-n -f .11 kinds. 9
4 CJtt-rL: C;:ntintntal consv:apttion of Indian and Egy;tian in
relation to American and relative prices 10
5 Cott.n: Continental mill consumption by growvths .11
6 Cotton: Prices of Indian in percentage -f American .. ..11
7 Cotton: Prices -f Egyptian uppers in percant,.ge 2f American 12
8 Cotton: American Continental spinner takings specified period .12
9 Cotton: Indicated production and yield pur acre in the
United States, crop of 1930 with comparisons......... 16
10- Cotton: Acreage with production in countries reporting for
1930-31, with comparisons . 18
11- Cotton: Russian production according to sources .20
12- Egypt: Governments intervention in the cotton market; the
amount bought and the expenditures by periods .24
UNIVERSITY OF FLORIDA
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