The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1872-08-16
THE COURSE OF COTTON.
A ABRIGHTPROSPECTF FOR THE AMERI.
CAN PLANTER.
The Decline IN PrIces-A Striking
Change in Public Opinion-Estimates
or Stock and Consumption, and the
Probable Range Of Prices.
From Smith, Edwards & Co.'S. Clrcular.l

LIVERPOOL, August l, 1872.
The month under review has exhibited vlo-
lent changes in a downward direction, and we
close at decline of lsd. per pound in Amerl-
can and Id. In Surat cotton.
At tho date of our last issue, the result of
stock-taking had been announced; small
surplus has been found In place of the def
cheney, which bad been generally expected,
and the effect. on our market was surprising.
Before the stock was announced there was q
good demand for August delivery of Orleans
at l13d., with o general expectation of an
advance; but as soon as the result was known
feeling of great depression ensued and the
price fell at once id. per pound. From that
time forward everything went against the
market; the accounts of the crop In America
came remarkably good; spinners stood oosl',,
nately aloof consuming their surplus stock and
theSlxport demand fell to zero. The feeling
rapidly epread through the market that prices
were TOO high and that lower level must De
reached before active business could oe re-
sumed; holders pressed their stocks, ana IL
became almost impossible to sell on the spot.
For q time the decline was not very rapid,
and some reports of heavy rains and
worms In America about the l2ta ult1mo gave
a slight stimulus for day or twu, but these
were soon followed by reports OF good wealth
er, and the eagerness of holders TO sell iu-
creased to panic; and from the 18th TO the
25th July the decline went on at the rate OF
vaded the Exchange. Confidence quite van
ished, and the heavy loss entalled caused fears
OF financial embarraSsments. At the lowest
point uplands and Orleans were sold for Au-
gust delivery at 9sa95d., showing fully I'd. per
ID. decline on the prices ruling before STOCK
rot, nk1lIA ar
Octo6er-N November shipments OF uplands did
not fall below 9sd., putting them on The same
level with August delivery, although month
before there was lid. per 10. difference be-.
tween them |! We nave seldom known our
stock of cotton more unstable than it was
during this whole period Of depression. With
the exception of the better grades OF Ameri.
can, it was hardly possible to sell any kind of
cotton, and East India in particular was
perfect drug. Holders, 10 relieve themselves,
sold largely OF forward contracts OF Amerl-
can, and probably many OF these will be
bought in again, thus lending fictitious
strength TO the market afterwards.
The very low prices touched on the 25th ult
at last brought In the demand, and on the
next day (Friday) there was q good business
done at ID. to ID. advance from the lowest
point. The Improvement was supported until
Monday, and the market assumed much
healthier appearance, but dull tone came
over 1t on Tuesday, and as we write (Wednes-
day. the late improvement Is almost lost. and
the closing prices on the spot are 9 ll-l6d. 10
lOd. for middIng uplands and Orleans; GID. for
fair Dhollerah; 9ad. 10 9ad. for landing uplands,
and sd. for October-Nuvember shipment OF
ney-crop.
The Manchester market throughout the
entire month has been powerfully affected by
the depression In Liverpool An incl nation
for business showed Itself more Than once
early IN the month, but It was quenched by the
demoralIzed state of this market, and no I'M
portant volume OF business was transacted Till
it was thought that the bottom had been
touched here. Nevertheless, the tone OF
Manchester all through this collapse has been
sounder than that OF Liverpool; there has been
far less pressure to sell, and The decline has
been more gradual, and thus the position of
producers has sensibly improved:
We incline, however, 10 the opinion that the
prospects of foreign markets are not 80 very
unfavorable; the present dulness Is very much
the result OF dlscounting the effect of large
American crop neXt year. and further fal IN
the raw material. We believe there Is plenty
of business waiting to be done If merchants
were satisfied that prices had touched bottom,
and we Incline to the opinion that pretty ac-
tive demand will be felt in Manchester for the
remainder of the year; there are no oppres-
sive stocks of goods on hand, and comparing
the state of Manchester with what We have
often known it to be during times OF depres-
sion, we should say that trade is far from un-
sound; indeed we believe hat, were people
satisfied prices of cotton had seen their lowest
point on this side of Christmas, a large volume.
of business wonld be put through.
The question Of "short time" has been spoken
of good deal lately, but from all We eau learn
there has been no resort to it OF any moment.
A good deal of machinery has recently been
stopped from one cause and another, among
which We may specify the damage done by the
1OnAa IN miIl9 Sitnate6
on water courses, but the effect will only be
transient, and we expect ere long to see all the
spindles and looms at work, and the consump-
tion at its full figure.
The very long sbstention Of the trade from
our market (navlng for seven weeks taken
only 46. 900 bales per weekly has raised much
discussion on the question of the consump-
tion, and 1t has been felt that the extent Of it
was over-rated, and at the same time 1t has
been discovered that spinners held larger
socks than were supposed. At one time the
most careful statists put the consumption at
sc, 600 bales Tor the Kingdom, equa. in weight
to about $4,000 bales of last years size. We
think the real figure could not have been over
62.O0O to 64, 900 bales, and perhaps OF late 1t
NAV have been reduced to $4,000 bales, from
the temporary causes we have mentioned.
We should say, however, that the natural
rate of consumption, were the machinery all
working, Is GA, 900 bales per week. OF the pres.
ent average weight, aud we think that it will
soon regain that figure, especially II prices 40
not rise from their present level. stocks IN
spinners' hands must be reduced to low eDo,
and are probably 100, 900 bales less Than they
were on the 1st January, and 200,OO0 oales
less than at this time last year, and people
who look merely at the scale OF delivery are
apt to under-rate the consumption now, just
as they were to over. estimate 1t year ago.
POSITION AND PROSPECTS.
A very striking change has come over pub.
lie opinion about the position and prospects OF
cotton during the last month. To glance
moment at the past. 1t may be said that The
prevalent opinion during the first halt OF the
wear was that there would be real famine Of
American cotton, and in Manchester the opn-
ion was strongly held that l3d. would be reach
ed for middliDg Orleans in the autumn. There
Ii no doubt that the consumption was then
over-estimated, and the stock held by the
trade underestimate, and looking at the
probable supply OF American cotton, as 1t then
appeared, 1t Is not 10 be wondered at that san
puine views prevailed; 1t did, on the face oft,
anpear q puzzle how 10 get through the year
with crop of 2,900.0 bales. when 43 mil
lions had almost totally disappeared the year
before. This difficulty was overcome by keep
inc the price of middlng Orleans al lid. to
lad. for six months, and though it now seems
that this price was too high, we believe that
nothing less could have saved us from pos
sible famine In the autumn, for even yet 1t will
REQUIRE extreme economy, and even plnching,
10 get tn, Two ends to meet. Of course
tt moo plo m that auch a nrice aS lie. to ll8d.