World cotton prospects

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World cotton prospects
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United States -- Bureau of Agricultural Economics. -- Division of Statistical and Historical Research
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Cotton trade -- Statistics -- Periodicals   ( lcsh )
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statistics   ( marcgt )
periodical   ( marcgt )

Notes

Dates or Sequential Designation:
- C-133 (Oct. 1936).
General Note:
Reproduced from typewritten copy.
General Note:
Description based on: C-59 (June 1930).

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Cotton situation
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Statistics on cotton and related data


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UNITED STATES DEPARTMENT OF AGRICULTURE
Bureau of Agricultural Economics
Washington

0-67 '"ORLD COTTON PROSPECTS Febru-ary 2, 1231




SLWJ IhRY


S The continuation of the upward movement in cotton prices which

I began in December has created more confidence in the textile industry and

reports from Liverpool and the Continent of Europe indicate increased buying

and price fixing on the part of the spinners.

The total visible supply of all cotton on February 13, 1931 was about

1.8 million bales above the corresponding date a year ago and 2.5 million

bales above 1929 whereas the visible supply of American cotton was 2.0 million

bales above last year and 2.1 million bales above the corresponding date

the year before.

Exports of raw cotton thus far this season continue to lose ground

when compared with exports last season, total exports for this season to the

end of January being about 412,000 bales below the same period last season

whereas a month earlier they were only 216,000 bales below the corresponding

period of 1929-30.

I The textile situation as a whole is not far different from what it

was a month ago. In ihe United States and some of the foreign countries,

however, the sentiment has improved due to the advance in some of the
*
speculative commodities. In the United States the sales of standard cotton

cloth during January were encouraging because of the large increase over

December and the fact that they were above January, 1930. The increase in

consumption of domestic cotton in January as compared to December on the

other hand was less than the average increase during previous years.




0-67 2 -

In Groat Britain the outlook was somewhat improved with the ending of tho

lock-out of the weavers and the prospects for a settlement of the political

troubles in India. On the Continent the continued unsatisfactory business

in ycrns and fabrics resulted in further restriction in activity.and output

in both spinning and weaving mills in January, but the latest reports indi-

cato that the continued risn in the prices of raw cotton has caused increased

buying and price fixing by the spinners and that the fooling in the industry

as a wholo is considerably bettor. In China both the Japanose and the Chinosa"iiM

mills continue to operate at full capacity. Tho Chinoso mills, however, re- 1

port slow yarn business and some accumulation of stocks while the Japanose

mills continue to be sold out woll forward. Although now business at prosent

is very quiet it is expected that an improvement in business will trko plaoo

at the beginning of the Chinese now year, February 17. The mills in Japan

are still operating under the restriction of output agreement. Yarn produc-

tion and exports of cloth decreased during January, but stocks of yarn aro

l:w and prices have strongthoned. Conditions in the textile situation in

general are more favorable for the consumption of American cotton.

From the latest production and ginning reports it would seem that the

early estimates for the 1930 crop in some of the important foreign countries

were slightly too high.

Prices
Spots

The advance in cotton prices which was under way a month ago still con-
tinues. From January 16 to February 13 the advance in the Liverpool spot
market for all imported growths ranged from 0.85 to 2.33 cents per pound. The
advances during this period in cents per pound for the various growths were
as follows: Egyptian Sakellaridis,2,33; Egyptian Uppers, 1.32;dIndian Sind,
1.05; Peruvian Tanguis, 0.99; Brazilian, Ceara and Sao Paulo, and American
middling, 0.89; and Indian Oomra No. 1, 0.85. From this it would seem that
the price of American relative to foreign growths is more favorable than a
month ago for the consumption of American cotton.

American middling spot cotton in the ten designated markets advanced
from 9.29 cents per pound to 10.14 cents or 0.85 cents from January 16'to
February 13, which was about the same as the advance in the Liverpool market.
"1 .







0-67


The average price in thuse mini'sts 'c the month of J.nu.r. was 9.37 cents
compared with 9.16 cents for Leicr.ter :.nd 16.56 cents during J.nuary, 1930.
The aver ge price received by pru'oucers in the United States on January 15
was 8.6 cents per pound compL.'rel with 8.7 cents in December :-.nd 15.8 cents
per pound on the 15th of J.nur ry, 1?-30.

Relative price of American and competitive cotton i/

Prior to the advance of prices of nm-rican cotton in the last half
of January, both Indian and Egyptian Uppers h..d been showing a tendency to
become higher priced in comparison with American; indexes based on quotations
for the last Friday before thc middle of the month at Bremen show that
Indian average of Sind, Oomra, Broach, and Pu.nj:.b rose from 76 per cent of
American cotton in December to 81 in J-nu..ry, the highest January figure since
1928 and the highest 'relationship of Iind iril to American since June 1528.
If this relationship continues for any ler.-th of time, it should have some
influence on the relative .mounts of Indi'.n "and AmericLan cotton consumed
in 1931, judging from the relationship between relative prices and the
tendency of consumption in recent yua.rs.

This relationship, however, appears to have become less f-voritle
for American in the last half of January as result of the upward turn
taken by American quotations, :nd- it is of interest to note that spinner
buying of Indian was immediately reported improved. This development
might indicate that the present outlook favors a narrow spre-d between
Indian and American staples. It is pointed oat by trade observers that the
prospects for some improvement of the political situation in India as a
result of the Round Table Conference in London foreshadow, a relaxation
of the boycott movement against British cotton goods and a general
strengthening of confidence in the business outlook in India. Such a
development, of course, could hardly occur without :. favorable effect upon
the cotton industry nearly everywhere. The rising tendency of prices of
Indian cotton in relation to American in December and early in January
appears to have been based partially upon this interpretation of Indian
developments at a time when the American market was weak. The decrease
in the visible supply of Indian cotton, however, was prob.-bly 'the
principal factor lending strength to Indian cotton.

The relative price of Egyptian Uppers at Liverpool in comparison
with American strict middling 1-1/16 inch at Bremen also increased consider-
ably in January, to 96 as compared with 93 in December. The indtx figure
of 93 for December, however, was the lowest in the past five years, and
in only one other month in this period, namely August 1929 when it was 94,
has it been lower than 96.

Futures

American futures markets rose faster than the Liverpool market
from mid-December to mid-January, but in the past month the Liverpool
market has made up this loss so that the gain from December 15 to February
13 has been about the same in Liverpool, New York, and New Orleans.

1/ Based on report dated February 6, 1931 from Agricultural Attache L. V.
Steere at Berlin, supplemented by cable of February 16.






C-67


From January 14 to Februa.ry 13 the rise in futures prices for the active
months was 1.14 to 1.18 cents a:t Liverpool, 0.77 to 0.94.at New Orleans,
and 0.75 to 0.95 at New York. July .nd October contracts made slightly
greater advances than did ]-rch and IMay contracts.

Stocks .:nd Movements

World visible supply

The total visible supply on February 13, 1931 was about 9,900,000
running bales compared with 8,060,000 and 7,444,000 at the corresponding
dates in 1930 and 1929, accordingg to the Commertial and Financial Chronicle.
Of this total on J-.-nurry 13 this year 7,420,000 b-.lcs were American .nd
2,481,000 were foreign whereas last year 5,372,000 were Americ-n and.
2,708,030 were foreign, a:nd at this'time in 1929, 5,276,000 b-.les were
America.n and 2,168,000 bales were foreign. Stocks of American cotton in
Liverpool and ILMnchuster at this time were -bout 87,000 brles above last
year, but about 193,000 below 1929. Continental stocks of American cotton
were about 90,000 bales above 1930 ..nd. 10,000 bales below 1929. Ame.rican
afloat for Europe on February 13, 1931 amounting to 200,000 bales was
162,000 bl.1es below a ye:r earlier. The greatest-inc.rease in the visible
supply of American continues to be in the United States. Fort stocks at
this time are about 1,753,000 -b.-'ls above last year.

The smaller visible supply of foreign cotton was due largely'to the
decrease in stocks of Indian cotton at Bombay. The stocks of Egyptian in
Alexandria continue well above last yo.r.

Exports of domestic cotton

Exports of ra.w cotton from the United States inJanuary amounted to
about 533,000 running b.les, or about 196,000 blues below January, 1930,
according to the Bureau of the Census. Exports to Japan were above last
year. Exports for the season to the end of January totaled 4,479,000 bales
.or about 412,000 bales below last season.- France was the only important
country for which exports from the United St .tes for the first half of the
season were above the corresponding period in the 1929-30 season.

Exports of foreign cotton

Exports of raw cotton from India from August 1 to February 12 this
season were 1,759,000 bales according to the Comm.ercial and Financial
Chronicle. This was 159,000 bales above last season. The increase over
last year was due to larger exports to Great Britain and to Japan and China..
Exports to the Continent were about 128,000 b..les less than last year.

Exports from Alexandria for this season to February 11 total 491,000
b:les compared with 567,000 and 639,000 b'.les in the corresponding periods
of the 1929-30 and 1928-29 seasons. Exports to the Continent and India so
far this season have been above those last season and the season before.


-4-





C-67 -5-

into sight, port receipts, mill takings, et-., of Amuric:.n cotton

Domestic cotton moving into sight in Janu-ry amounted to about
729,000 bales according to a report from the Now Orleans Cotton Exchange.
This was 111,000 biles below January, 1930 :.nd was the lowest for the-
month of Janu.ry since the "'ar. The total movement into sight the first
six months this season amounted to 12,049,000 bales compared with
13,065,000 b:.les last season. This smaller into sight rnovn.int is no
doubt due partly to the tendency of the owners of cotton to hold for
better prices and partly to tie smaller crop. rort receipts and stocks
at ports and interior towns in the United St.:tes continue .-bove last year
while cotton moving overland to mills in the United St-tes and C:anada
during January were the lowest for the month since the "W.r.

Stocks in consuming establishments, etc.

Total cotton on hand on JTnuary 31 in consuming establishments this
year was 1,613,000 b.les or 212,000 bales .bove a ye-r d.rlier. Stocks of
foreign cotton in these establishments were slightly belaw last year. RNw
cotton in public storage .nd r-t compresses in the United St-.tes on
January 31 which amounted to 7,939,000 b?.ls was an iricrease of 2,535,000
b .les over last year. This increase in the total stocks w:.s likewise
due to the increase in domestic cotton, as stocks of foreign cotton m-:ke
up a very small portion of the total rand were below a year ago.

Continental spinner takings

Continental spinner takings of American cotton during the four weeks
ended January 23 amounted to only 274,000 bales as against 406,000 in the
same period last year and 454,000 two years ago, according to Agricultural
Attache Steere. An increase in takings has been expected, and reports for
the last week of January indic..to that this has actually taken pl.ce,
but it still remains to be seen whether the improvement will continue long
enough to make for any substantial rise over the period of a month. The
usual seasonal tendency for takings is slightly downward in this p-rt of
the season.


Thxtile Situation

United .States

The increase of mill consumption during Ja-nu;.ry which amounted to
about 48,000 bdles w'.s less th:.n the avera-. increase for the ten years
1920-21 to 1929-30. The January consumption was 102,000 bales above
last August whereas during the p-st ten years January ht.s z.ver.ged 125,000
bales above August. The monthly rate of consumption for the six months
ended January 31 was 411,000 br.les compared with 552,000 bales during
the same period a year earlier.







. -6-


The domestic consumption of raw cotton during January amounted
to 454,000 running bales -compared with 406,000 bales during December,
576,000 balus during January, 1930 ..nd 352,000 during August, 1930,.
according to the Burt=a of the Cnsu3. This increase in January ovur
December of 48,000 bal-s compares with -an ver.~g incre.-.s during the
past ten years of 65,000 bales. The daily rate of.consumption for
January was approximately 2,400 bales abovu the December levul ,.nd
4,300 bales above the low average during August. The total consumption
during the first six months this sec-.son was about 2,466,000 bales
compared with 3,314,000 bale's durin"-the same period last season.


The weakly average of production, sales and shipments of standard
cotton cloth during January showed substantial increases over December
which resulted in the decrease of.2.3 per cent in stocks on hand and an
increase of 9.9 pur cent in unfilled orders during the month of. January.
The weekly aver:.go of production during January w:-s 50.5 million yards
compared with 46.8 million yards during December or .an increase of
3.7 million yards whereas during the three years 1927.-28 to 1929-30 the
increase has aver ged only 0.8 million yards. Shipments during January
also increased more than the average increase during the past three.-
years, the weekly average amounting to 52.6 million yards compared
with 45.4 million yards during December. This was an increase of 7.2
million yards whereas the three year average increase amounted to 4..6
million yards. The ratio of shipments to production in Jaiuary iwas
104.2 per cent whereas in December it was 97,0 per c-ent and during
January 1928,-1929, and 1930 averaged 97.6 per cent. Sales of cot-ton
cloth during January as compared with December.showed a very substantial
increase and were slightly above January last year. It should be
remembered, however, that the sales during December were unusually low.
The weekly average in January amounted to 59.8 million yards, 23,3
million yards above December, 14.0 million yards above 4lovem.er, and
1.4 million yards above January-1930. The ratio of sales to production
during January was 118.3 per cent compared with 78.0 per cent during
December and a 3-year average of 82.7 per cent.

Great Britain

The textile situation in Great Britain has improved some with.
the ending of the lock-out on February 14. The lock-out which took place
during the week of January 19 and involved some-180,000 to 250,000
weavers was brought to an end by the manufacturers, and operatives began
work Monday, February 16 at the same terms-as existed before the lock-out.
The trouble started when the weavers refused to accept the manufacturers
plan for operating more looms per weaver. The plan called for the
operation of about eight looms'per weaver, whereas at present the usual
number is about four looms per weaver. According to the new plan the
operatives would have received higher wages per person, but the
objection was made to a reduction in the number of weavers employed.


C-67






C-67


Exports of cotton piece goods i- Grcot Britain in January amounitcd
to 155.6 million yards, an increase of 25.4 million yards over December and
compares with an average increase for the ten years 1120-21 to 1929-30 of
30.5 million yards. Total exports for the six months ended January mounted
to 877.1 million yards compared with 1,695.4 million yards during the same
period a year ago and 1,974.8 million yards during this period in 1926-29.
This is a decrease of 48.3 per cent from 1929-30 znd 55.6 per cent from
1928-29.

Exports of cotton yarn in January amounting to 11.3 million po'uids was
0.3 million pounds below December, 1.9 million pounds below January 1930
and 2.6 million pounds below the 10-year average for January. During the
past ten years January has averaged about 0.4 million pounds above December.
Exports for the first six months this season totaled 64.9 million pounds
compared with 79.2 million pounds in the same period last season or a
decrease of 18.1 per cent.

The low exports of piece goods reflect mostly tne falling off in trade
with the Orient, due to the Indian boycott and the decline in silver, al-
though the exports to other countries are also low because of depressions.
The low exports of cotton yarn reflect the textile conditions in Continental
Europe mostly.

Continental Europe 1/

The slight rise in raw cotton prices during January was not reflected
on the Conti:rnt in any improvement in sales or in general conditions in the
industry, but the continued rise has quickened buying and price fixing. The
position of the cotton textile industry continues very unsatisfactory
practically everywhere on the Continent. The generally finner tendency of
raw material prices, however, appears to have brought a slightly better
sentiment as to the future outlook.

N.,w business in cotton yarn and fabrics continued the object of much
complaint throughout January in all the leading continental cotton textile
countries, including France. Only the Spanish and the small but well pro-
tected Hungarian and Yugoslavian centers continued to enjoy anything like
favorable conditions. Business elsewhere left Tadch to be desired, with
new bookings consisting only of small ourchnses for early delivery. The net
result was a further decline in the volume of unfilled orders on hand in
most countries, but notably in Central Europe. The idleness of 700,000
looms in the Lancashire district, as a result of labor troubles, was ex-
pected to lead to some pick-up in orders for cloth mills on the Continent,
especially in Germany, but so far this development has not appeared,
apparently because of the large stocks of cloth held in Lancashire. New
business being booked by both spinners and weavers in France appears to
continue a little better than in the other important countries on the
Continent, but, nevertheless, has been very quiet. The cloth mills have
done a little more business at the close of the month.

1/ Based on report dated February 6, 1931 from Agricultural Attache L. V.
Steere at Berlin, supplemented by cable February 16.


-7-








Continued unsatisfactory business in yarn and fabrics resulted in
some further restriction in activity and output in both spinning and
weaving mills during January for the Continent taken as a whole. Figures
recently available indicate that the general level of mill operations in
Central Europe rose slightly in-December in comparison with November,
chiefly for seasonal reasons, but subsequent changes have unquestionably
brought curtailment. Present levels of activity in Western and Southern,
as well as Central Europe, are much below what can be regarded as normal
operating activity for the years since the industry has regained more
stable conditions following the war and inflation. Production is clearly
below the rate of consumption of cotton textile goods.

Jeauary purchases of raw- cotton by spinners were generally limited
for the month Ias a whole, though some activity developed during the first
part of the month, following the period of holiday inactivity. January
price fixing was also limited and c.i.f. merchants' import .purchases were
generally confined to occasional bargain sales. End of the month reports,
however, indicated increased interest for both Indian rnd Egyptian cotton,
and bargain lots of South American growths were also readily taken by
'continental spinners. Contrary to the usual tendency of buying interest
to revive when raw material prices show strength, the slight but general
rise in raw material quotations during January did not bring out any
noticeable buying activity in the past month, though it appears to have
created generally better feeling in the trade and the textile industry.
Extreme caution in buying has become so ingrained and universal since 1929
that more evidence of market strength appears necessary to uncover real
demand. Later reports indicate that the sustained rise in price is now
resulting in increased buying Tnd price fixing by continental spinners.

Germany

The German cotton textile situation remained extremely unsatisfactory
well into January, with general complaint from spinners and weavers, both
as to volume of new business being booked and as to prices obtained. Some
seasonal improvement in cloth sales is now evident but the extent and dura-
tion of the improvement cannot be foretold. For some time there have been
complaints that further restrictions in activity are unavoidable unless
early improvement in the flow of new business materializes.

Spinner reports for December and January indicate that sales effect-
ed were generally of small volume and mostly for immediate delivery, with
practically nothing being sold for more than a couple of weeks ahead. Un-
filled orders on the books of the spinning mills appear to have undergone
further reduction, with the competitive situation indicated as so keen
that prices must be considered unsatisfactory notwithstanding the low
level of raw material prices. German spinning.mill activity increased
somewhat from November to December for seasonal reasons, but January is
believed to have brought a decline.


C-67


-8-




0-67 -9-

As a result of tne continued unsatisfactory distributor demand
for cotton mill output, German spinner demand for raw cotton, particu-
larly American, has been very irregular during January, in spite of the
revival in cotton prices. A slight pick-up in spinner inquiry developed
during the first part of January, both for prompt delivery and delivery
in the first quarter of 1931, but following the middle of the month
spinner purchases of American cotton slackened off, though Indian
staples continued in some demand for prompt delivery, and lower quality
Egyptian appeared to find fairly active interest. Later, spinners
generally showed somewhat more-interest for prompt and near deliveries
of all growths, a revival chiefly attributable to the rising tendency of
the raw market. At the close of the month quietness again ruled for
American cotton, although the demand for Egyptian and Indian became somewhat
more satisfactory, even though turnover was not of any great volume.
Bremen merchant purchases for import, c.i.f., however, remained very quiet
throughout the entire month and spot business also showed little activity
in Bremen during January.

The steady falling off in activity and earnings in the German cotton
textile-industry indicated in reports in the past two years has been clear-
ly confirmed by statistics on the dividend declarations recently issued
Sfor 87 German cotton textile concerns fur the years 1927, 1928 and 1929.
As the dividends were actually declared late in the following year, allowance
should be made for the tendency of operations during this period, which
means that the dividends declared reflect to a considerable extent condi-
tions developing subsequent to the dividend year itself. The data for 1929,
for example, appear to reflect conditions of 1930 more than those of 1929.
The increase in the number of textile concerns-paying no dividends at all
is striking, particularly among firms engaged entirely in spinning or en-
tirely in weaving, Plants performing both operations appear to have shown
considerably more ability to compete under the severe conditions which have
developed since 1927.

Table 1.- Dividends paid by 87 German cotton companies

Number and : Average percentage Companies paying
kind of : dividend -aid : no dividend
companies : 1927 : 1928 : 1929 :1927 1928 : 1929
; Per cent: Per cent: Per cent: .- mber : .amber : Number

23 Spinner- : : :
Weavers : 10.4 : 5.0 : 3.2 : 3 : 9 : 14
34 Spinners : -9.8 : 6.00 : 2.5 : 7 20 : 27
30 Weavers : 7.8 : 3.1 : 0.5 : 15 : 27 : 28


Thi outlook for the textile industry in Germany is also being rendered
uncertain by the campaigns now underway to bring about a reduction in
prices and wages throughout the country, as this immediately raises the
prospect of labor difficulty. Wage reductions have been effected in various
mills already, and a number of disputes are now in progress, so it is not
impossible that bothersome labor trouble may develop.








C-67


The Western German Course Cotton Spinner's Association is preparing
to cooperate closer through price conventions, uniform production re-
strictions and association premiums for exported goods, similar to those
in the'iron industry.

Czecho slovakia

The cotton textile- situation in Czechoslovakia also remained very
unsatisfactory throughout Januar'y, according to trade reports. It is
indicated that incoming orders for the mills are entirely inadequate to
keep them occupied at an acceptable level. Reports state that activity
has declined in December and January, after arise in mill operations from
84 per cent of single shift capacity in October to 89 per cen3t in November
following some seasonal pick-up in orders in the fall. Improvement in
sales is needed if the' downward tendency of mill. operations is to be halted.

The less favorable reports from the cotton industry in the past
months appear to be at.least partially due to the termination of the .
Czechoslovakian-Hungarian trade treaty on December 15, 1930. Both spinners
and weavers claim that business with.Hungary. is exceedingly, difficult to
do under present conditions. Labor troubles are also beginning to
threaten the industry. Wage disputes and,negotiations looking to the re--
duction of wages are reported going on in Czechoslovakia, with prospects
*that difficulties may develop in some centers. The textile associations,.
have requested that the Government advance the placing of its orders for.
textile deliveries on state account, in order to assist the industry in
bridging over the present period of unsatisfactory conditions.

The difficulties experienced by the industry have also led to revival
of interest in the setting up df the spinners' price cartel which was
discontinued last autumn after a short period of operation. It is
announced that negotiations to this end will be tnkan up. in February, but
cohsiderable8'dubt is expressed as to the likelihoodd of achieving anything
tangible. 'In this connection, it is recalled that .the so-called Central..
European Export Convention between Czechoslovakia, .Austria, Italy and.
Hungary, which was once planned, has never been realized. It had been
expected that this convention would'succeed in some regulation of export
prices and particularly the extension of credit for. sales t .the Balkan
countries. Failure to come to an agreement is attributed to Italy's
refusal to enter the convention because of a desire to retain a free hand
in the development of trade relations with the Balkan countries.
A:"
f ^ *.


-10-




-11-


Austria

Reports from both the spinning and weaving branches of the cotton
textile industry in Austria continue very pessimistic, though some slight
improvement in sales to Hungary has been experienced by Austrian mills as
a result of the Czechoslovakian-Hungarian tariff difficulty. Austria
seems likely to benefit to some extent as long as the tvo countries con-
tinue on a non-treaty basis, though this possibility does not seem to
give much encouragement to Austrian textile circles, judging from the
pessimism of current reports.

Reports on Austrian textile conditions should always be considered
in the light of the fact that the production capacity of the Austrian
textile industry has been tending downward in recent years because of
the surplus of spindelage in relation to the looms within the country and
because of the l-ck of up-to-date equipment and management in the cloth
mills. About a quarter of the looms in pl-.ce are said to be idle because
of inability to m:.ke a profit, although consunptive requirements for
cloth in Austria far exceed the capacity of the cloth mills, and despite
tariff protection that should be adequate. The situation is one calling
for radical changes before the Austrian cotton textile industry can be
placed on a sound basis.

The annual spinners report for Austria indicates that 1930 exports
of cotton yarn were 40 per cent below those of 1929 '.nd total 1930 s-les
of cotton yarn 27 per cent below 1929. Total cloth production in 1930
was 30 per cent below 1929. The report indicated the probability of further
restriction of domestic production in 1931. On the other h.:;nd, it appears
that mill stocks of cotton yarn in 1930 averaged about 25 per cent below
the average for 1929. This fact would doubtless be reflected promptly in
a revival of spinning and weaving mill activity should consumer and trade
demand improve in connection with -n upward turn in the general business
situation.

France

French cotton spinners and wea.vrs reported rather slack business
in yarn and fabrics during January, at least when compared with previous
months. Unfilled orders appeared reduced :.nd mill activity somewhat
curtailed, with further curtailment in prospect in the immediate future.
The outlook in France, therefore, is somewhat tinged with pessimism,
though current conditions are still satisfactory enough in comparison
with the situation in Central Europe.

Reports on the spinning section for the early part of J.nuary
indicate that the yarr. market at Roubaix was very quiet, with s:les in
Normandy alsounsatisfactory, though the latter region felt some slight
improvement toward the end of the month. Mill activity was slightly reduced
in January in both the North .-.nd in Normandy, as well as in some of the
eastern regions, and will apparently be further reduced during Febru..ry.
In Normandy and in the Vosges, the organized stoppage amounts to 8-12
hours a week :.nd is somewhat more in the North. The stoppage has made
it possible to do away with some of the second shifts, however, and, in
this way, is tending to prevent unsound accumulation of yarn stocKs.


C-67








New business of the French.cloth mills was also very quiet through-
out January, with some pick-up toward the end of the month as a result
of a somewhat improved export position based on better reports from
Algeria and other Africa. Madagascar and Indo-China remained unsatisfactory
buyers. Generally speaking, the weaving situation in France seems to be
slightly improved over December as far as new business is concerned, but
activity was slightly reduced, with the Rouen cloth mills having organized -
a stoppage of 12 hours a week.

Spinner demand for raw cotton, as well as French trade demand remain-
ed rather quiet through the month, with some improvement toward the end be-
cause of the rise in the raw market. Around the middle of the month, it
was reported that spinners were giving preference to Indian cotton for
new purchases. Price-fixing toward the end of the month, stimulated by
slightly rising raw cotton quotations, assumed somewhat larger proportions.

Italy

No significant changes have occurred in the Italian cotton mill .
situation during the last month or two, with spinning mill activity about
unchanged at around 70 per cent of capacity or about 25 per cent below .
levels at the same time in 1929 and 1928, and with weaving mill activity K'
about 20 per cent below those years. .

New sales of cotton yarn remain somewhat below the current 'level ofa .
production, but the deficiency is smaller than at the same time last year..
Yarn stocks are still about 30 per cent above last year and unfilled orders
on hand in the spinning mills much below levels at the same time in 1230.
Spinners supplies of raw cotton and contracts on hand are still small and.
merchant and spinner demand for spot and c.i.f., cotton has been rather
quiet, but the continued improvement in prices is now causing increased
buying and price fixing.,

The active wage reduction campaign going on in.Italy has also
affected the cotton industry, as the wage reduction of'8 per cent as of
December 1 applied to all Italian industries..

Belgium

Belgium spinners and weavers also continue to report unsatisfactory .
conditions in respect to new business and mill activity. Stoppage is
reported to average 25-50 per cent of capacity. Spinning activity, however,
is being better sustained than weaving activity as the weaving mills have
not only suffered from the general economic crisis but have also lost mubr:. i
of their export business, notably to South America and the Near East.

Holland

The cotton situation in Holland still seems well sustained on the
whole, but, *in-.view of the reduced orders in weaving mills, it appears that
conditions may grow worse for spinners, and general curtailment may occur.

The report of the Dutch spinning and weaving mills to the Inter-
national Federation at Manchester for the fourth quarter of 1930 states
that the demand experienced in the spinning section proved small, and that
spinners find it difficult to dispose of their production. A little short-


C-67


-12-







C-67 -13-

time is observed in scme of th :;.illi, b t :most of thg;'n :.ru still able to
sell full or nearly full output, though with difficulties, .rnd cnly at
price sacrifices. The weaving mills are also in .. worse situation than in
the third quarter of 1930, with export mills finding it very difficult to
sell their output, and having in m-ny cases reduced production. Unfilled
orders on hi-nd in the weaving mills, for export os well a.s for thL domestic
market, are reported much smaller than last yj .r. Activity of th.z clotli mills
working for the domestic market is reported consid. r-.bly reduced or about 20
per cent below normal operation.
Pol and

Reports on January textile developments in Pol:tnd are still lacking,
but the situation is not thought to have undergone material change since
December, though probably continuing the less favorable tendency.

Polish spinners' sales of cotton yarn during Decemnber were smaller
than actual production, and yarn stocks consequently increased again. In
January sales were about equal to production with stocks unchanged. The
demand for finished goods has not proved eoual to expectations, and the mills
again reported the accumulation of considerable stocks, especially of winter
goods which may prove difficult to dispose of during' th- remaindL-:r of the
season. On the other hand, the wholesale and retail trades are reported to
have hardly any stocks, which balances, at least to some extent, the increase
observed at the mills. As the spinners trust practically ceased to exist
on December 31, 1930, because of the failure to obtain adherence to the
agreement by a sufficient n.unber of spindles, the control of production
exercised by that body has been lost, a fact which may have quite an unfavor-
able effect upon Polish cotton textile conditions, at lest for a ti.ie. It
is regarded as not unlikely, however, that forced reorganization of the trust
will be brought about through a policy of over-production and depression of
the market by the large and financially stronger mills, whose owners a.re
indicated to be desirous of bringing the smaller units into the agreement.

Soviet Russia

The Russian cotton textile industry showed a large increase in
activity during the last three months of 1930, with a reported tot-al pro-
duction of 723,963,000 yards of cotton cloth or about 143 per cent more
than in the preceding three months, when the output was sharply curtailed
as a result of raw material shortage. Production during thitse three months
(October December), however, was still below the output of 766,298,000
yards in the corresponding months last year and thu production of 762,239,000
yards two years ago. Mill activity appears to be returning to normal, as
the new crop of cotton is becoming available. Shipments of cotton from
the producing regions to the cotton mills are now reported fully up to
plan and even somewhat above the plan since the beginning of the new pro-
curing campaign.





C-67 -14-

China

Japanese mills in China continue to be sold out well forward and al-
0
though new cotton business at present is very quiet and American supplies are
quite large, importers feel that Japanese mills will .be in the market again
and that the monthly rate of consumption of fully 20,000 bales of American
cotton will be maintained for this crop year. Chinese mills report slow
yarn business and some accumulation of stocks according to a cable from Agri-
cultural Cor._issioner T'hus at Shanghai. Tle mills, however, are still run-
ning at full capacity with the expectation of an improvement in business at
the beginning of the Chinese new yuar, February 17. A consolidated tax on
cotton yarn which is to be collected at the mills went into effect February 1.
This tax was to take the Alace of various internal transit duties which were
in effect up to that time. The administration of the tax is a source of
great disturbance. Tne tax on yarns,.below 23 counts at the present rate of
exchange is about $1.75' per bale of 400 pounds or a little over 0.4 cent per
pound and for counts above 23 is $2.38 per bale or 0.6 cent per pound.

Prices of Cainese cotton have continued to advance during the past
month, largely due to the lower silver exchange and the expectation of a
shortage in the supplies of Criinese cotton. The rice advances in India com-
bined with the lower silver exchange makes it no longer possible for Indian
cotton to be delivered in China at prices below Ciinoso cotton and as a re-
sult some orders for Idian cotton have boon canceled and exports for the wook
endd February 12 from India to J.:p..n and China wore loss than 1,000 bales
compared with 63,000 bales during the corresponding week last year. The un-
procedontedly low exchange has brought about relatively high prices for
American cotton and without corresponding advances of high count yarns tho
consumption of Aewrican cotton may be curtailed.



The J-.pan:so mills are still operating under the agreement to restrict
output which calls for a nominal curtailment of about 34 per cent or an actual
curtailment of about 30 per cent, according to Consul Dickover at Kobu. This
curtailment has brought about an artificial scarcity of yarns and as a result
yarn )ri'cos are unnaturally high. I-ndoecndont wnavors are complaining and
there is some importation of cheaper Chinese yarns. Thcso and other factors
are expected to result in a change in the actual curtailment to about 26.5
per cent to become offectivo April 1, 1931 and a further removal of the re-
striction effective July 1, 1931. Yarn erouuction in January amounted to about
80.3 million pounds compared with 84.4 million pounds in December. Exports
of cotton cloth during January totaled 124.0 million square yards or about
4.0 million'yards below December.

Consumption of American cotton in Japan during the last four months of
1930 amounted to about 74,000 bales monthly, but several conditions favor a
monthly consumption of at least 80,000 bales for the balance of the crop year
ending August 30, 1931. The parity between American and Indian cotton prices
favors the use of American and therefore the mills will probably use more than
the usual percentage of American cotton in mixtures for medium count yarns.
The more profitable prices for medium count yarns than for coarse yarns is
another factor favoring the consumption of -.erican cotton. he consumption
of Amoric'an cotton for the crop year is estimated at about 1,000,000 bales.
Mills continue to import American cotton on a hand to mouth basis and January





-15-


imports of American, which totaled about 98,000 bales, were only slightly
more than the estimated consumption. Arrivals of Indian cotton have boon
more liberal, but there is a scarcity of both Indian and American spot cotton.
The visible stocks of American cotton at the end of J.nuiry totaled about
124,000 bales compared with 208,000 bales .last year and 260,000 bales at the
end of January, 1929 and the visible stocks of all cotton are similarly low.

Production, acreazo and cro) condition reports

United States

Production Ginnings of domestic cotton nrior to January 16, 1931
amounted to 13,592,000 running biles compared with 14,177,000 to the s.mo date
in 1930 according to the Buroau of the Consus. Ginninjs therefore, so far
this season wore 95.9 per cent of the ginnings to the same date last year.
The estimated production this season of 14,243,000 bales is 96.1 per cent
of the final estimate for the 1929 crop. Th. States of Arkansas, Mississippi,
Oklahoma, and Tonnessoo showed the gre-test decreases in innings this year
as compared with last y)ar. In South Carolina, Georgia, and .1labama, the
innings wore considerably above last season.

Quality of th3 crop The quality of the 1930 crop is still running con-
siderably better than the 1929 crop. The percentage of the crop ginned prior
to January 16 which was untondorablo in staple (under 7/8 inch) amounted to
12.8 compared with 19.3 last season. There was a smaller proportion of cotton
1-1/8 inches and longer in staple this year than last, about the same percen-
tage of 7/8 to 29/32, but a considerably larger proportion of 15/16 to 1-1/32
inches. The grade of the 1930 crop has also been running better than that of
the 1929 crop which was la.rgoly due to the more open wo:.ther conditions this
year.

Ind i a

Cotton production for India for the 1930-31 season is forecast at
4,047,000 bales of 478 pounds not according to a cable received by the Bureau
of Agricultural Economics on Fobruary 18 from the Indian Departmznt of Statis-
tics at Calcutta. This is about 98 per cent of the revised estimate at the
same date last season, and about 92 per cent of the final estimate for last
year. Acreago planted to cotton this season is now estimated at 23,531,000
acres, or 94 per cent of the revised estimate of the same date last season
and 92 per cent of the final acreage estimate.

The production of cotton in the Provinces of Punjab and Madras, India,
was estimated on February 11 at 627,000 bales of 478 pounds not and 351,000
bales, respectively. This is a docr::so of 32,000 bales or 5 per cont under
the final estimate of the crop in Punjab last season and 23,000 bales or 4
per cent under the estimate at this time last year. Since 1920 the crop in
Punjab has boon about 13 per cent of the total Indian crop with a range of
from 7 per cent to 16 per cent.

There is a decrease in M-.dras of 75,000 bales or 18 per cent under the
final estimate of last season and 78,000 bales loss th..n the estimate at this
same date last year. For the past ton years the production in Madras has been
about 9 per cent of the total crop with a range of from 8 per cent to 10 per
cent.


0-67







Eyp t

It is estimated that 1,106,000 br.ls.of 478 pounds not wore ginned in
Egypt up to February 1 according to a cable received from the International
Institute of Agriculture at Rome. This is a docr'c-zc of 139,000 bales or 11
per cent from the innings to the same date last season and is 213,000-balos
or 16 per cent below that ginned up to February 1, 1929. The latest ostimatoet
production for the 1930-31 crop, however, was only 1.6 per cent below the 1929
production and is slightly above the 1928-29 crop.. This would scom to indi-
cato that the production forecast is too high or a considerable portion of
the crop is being loft in the field because of the low prices. Of the total
innings to Fabruar 1 this year 270,000 b:ilos wore of the Sakellaridis vari-
ety. This is 103,000 baleo or 28 per cent loss then the innings to the samo
date last year and 140,000 bales or 34 per cent luss thb.n ginned by February
1, two years ago.

1Misco llanou nseows

Cotton Tprico inv e'i.:ation

The j'int r-c':?lution S. J. Res. 195 by Sen:.tor Sheppard which passed
the Scnotoe 1 Djccr.i:br, 1930 and.was sent to the : juseo anittoo was approved
by that corinittoo in the last :'.ek in J,-nuary. T:;is roeulution, it will be
rememborcd, provides for the authorization of the Sro-toary of Agriculturo
through the Gr-.:in Futures .Ai.ministr-ation to invcstigr.to the cause of the de-
clines in the price of cotton in 1926, 1927, 1928, 1929, 1930 and provides
for an appropriation of "125,000 for the investigation.

New uses p.ropagEL da

An exhibit illustrating the now uses activities of the Cotton Textile
Institute has already traveled more than 5,300 miles throughout Zuropo and
on January 31 .was on the .;ay to E lrpt to be di,'l~-..,ed by the Royal Agricultura
Society during February, according to the Cotton Tri2rdo Jcurnal, January 31,
1931. From E7Tjpt th-e oeibit .:ill go t3, S.itzerlr-nd. In England and Gormany
according to the report orga!iz J promotionc.l activities have taken placb
following the displ- of the exhibit.

According to the procs the women students of the University of Missouri
have adopted a resolution favoring spring wardrobos, including stockings, of
cotton.

Egyntian Go-.-ornmiont cotton policy

Egyptian spinners mooting in Cairo rocoraondod that the Egyptian
Governmr.nt sell each day a fixed quantity of the cotton which it now holds,
according to a cable roc-ivod from P. K. Norris, cotton specialist of the
Bureau of Agricultural Economics at Cr.irc. They further recommend that this
quantity be sold regardless of price and that the sales begin at the close
of the present season.


- -0----


C-67


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C-67 CO!TEITTS IPa






1 S-n ar . . . 2
2- Prices ........... .............. 2- 4
3 Stocks and movements . . 5
4 Tc:;tiil situation . . .. 7
5 -uro e . . ... .7 -13
6 C i a . . . 14
7 Jep an . . . 14 -15
8 Production, acragc and crop co:,litior reports .. .15 -16
9 Iisccllancous news . . 16


TALES

1 Dividnrds paid by 87 German cotton coipanics .. 9





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