Evening star. [volume] (Washington, D.C.) 1854-1972, 1901-03-16
Depression Now Existing in Cotton
Manufacturing.
MANY OF TEE MILLS HAVE CLOSED
Other Conditions Throughout the
Republic Favorable.
FUTURE OF MINING FIELD
Special Correspondence of The Evening Star.

Special Correspondence of The Evening Star
CITY OF MEXICO, March 10, 1901
The stagnation which now exists In the
cotton manufacturing Industry of Mexico
will prove a benefit rather than a misfor-
tune II the lesson it conveys is taken to
heart A large proportion of the cotton
mills producing the coarser grade OF goods
are now closed down as a result of over
production. There are other complica-
| tions In the situation which will necessi-
tate reorganization of this business and
will undoubtedly lead to greater care in
the organization and extension of other
new industries and greater conservatism
In loaning money upon industrial securities
The staple article of consumption In Mex
leo In the line of cloth is a coarse grade
OF cotton from which nearly all the
clothing Of the people is made. 1t was
but few years ago that cotton manufac-
turing was almost unknown in the repub-
lie. This condition did not last long how
ever, AFTER the promoters from the United
States and other foreign countries realized
the possibilities of the situation
In 1888 there were s12. 600 600 invested in
cotton mills in this country. Now there
are over 100000 represented in plants
coming under that classification. As Mex
leo Is not an exporter Of cotton goods as
soon as the local demand was supplied
trade reached it's limit. The high price of
country Mexico secures large portion of
her raw material, the expense of fuel other
than water power and the large capitalize
ton and fixed charges against the mills
were combination of circumstances which
rendered the industry unable to withstand
any period of severe depression.
The result has been drop in the price
or cotton mill stocks, in some instances
below the amount for which they were
pledged.
The Lesson to he Learned.
The remedy for the present depression is
already being actively discussed, and it is
generally agreed that a solution will be
found I'm time which will again put more
encouraging face upon affairs. The mills
will develop more water powers, thus u.s.
ing less expensive fuel, will put in ma
chinery for the production of a higher
grade of goods. will increase the consum-
ing power of the people by development and
reduce the fixed charges by reorganiza-
ton.
Another thing which will be of material
assistance In starting these mills again will
be a drop in the price of cotton in the
United States, which is looked for as in
evitable. The method employed in build
ing some of these mills may lead to loss in
certain directions, for the stocks have In
number of instances been ''kited" The
stock of the parent concern has been pledg-
ed for money to build another mill and so
on, until the original investment sufficient
only to erect one plant, has been used to
erect several, all of which are heavily
incumbered. Normal conditions of pros
perfty can hardly correct entirely such a
procedure this for even under extraor-
dinarily favorable conditions 1t would be
difficult to carry such enterprises to a sue
cessful outcome In brief the industry
mas Deen rushed to death, encouraged by
prohibitive tariffs and favorable conces-
sions. which led to enormous profits in the
first days of the business The mills will
be reorganized, the needs of the market
10 Ypf.rl CT Jla1
cost Of operation cheapened and in time the
industry will accommodate itself to the
needs OF the country. AS result of this
process the water will be squeezed from
the stocks badly managed plants win sue
cumb and there will be more or less loss
distributed among those who furnished the
original capital and those who loaned
money upon these industrial securities
without taking into account the tendency
to overdo The present condition has been
Ioreseen by shrewd observers for several
years. but the building Of cotton mills in
Mexico became a sort of mania and had to
run its course.
Development of Mining.
The cotton industry however, seems to
be the only point in Mexicos Industrial
Affairs which presents any unfavorable as
peet. Mining Is the great resource of This
country. and in less than twenty-five years
the production Of gold and silver alone has |
risen from SIS OO0, 600 to $4,000. Oo0 to gay |
nothing of other metals which are mined |
incidentally. There Is no possibility of |
OVERRIDING the mining development, for the |
product is staple the world over and al |
ways finds ready cash market at fixed |
twenty-five years from now the output of |
precious metals from Mexico will be many
times what It Is today, for in the great |
q snd
has as vet been barely prospected for
mines. The increasing mineral output OF
the country represents the rapid growth
and development of the mining industry,
and where one property may be found pro-
ducing freely at the height Of its prosperity
a hundred have been recently discovered
and are being prospected with ample prom |
Use for the future.
The mining laws of Mexico are admirable |
IN their simplicity and Justice. This b an |
easy country to do business In. All rights
and everything Is done to encourage the |
development and solid wealth OF each ana |
every district. The state legislatures and |
local authorities are friendly to the miree |
owner. be he native or foreigner. and |
nearly all Of them are of the latter class,
and any local legislation within reason can /
be secured to improve mining facilities.
Increase i'm Railways.
The Industrial development Of Mexico In /
shown In the fact that I'm less than twenty |
FIVE years the railroad mileage has increas-
ed from 40 miles to nearly 5000. The /
in still greater proportion, and rates charg-
ed for traffic compare favorably with any |
section of the United States. A striking /
feature of Mexico's industrial growth Is |
shown In the fact that the post Office ham
died about ten million pieces of mall in /
1893 and last year handled nearly one hum
dred and twenty million pieces. While in /
the past seven years the export duties
have remained about the same In amount
collected by the government. the receipts
from import duties have risen from 81. 0oO.
600 to $2S 600 900. In I'VE years the teie-
graph tolls collected increased from $780,
600 to over one million dollars. Nearly all
of these items have a direct bearing upon
the industrial growth Of the country, for
there Is no other cause to which this in
crease can be assigned.
Need of Greater school Facilities.
Education is compulsory throughout the
republic. though 1t Is much hampered by
lack OF facilities due to inadequate hnan-
cial resources on the part Of the federal !
and local governments. and also to the
fact that the ruling class is not yet fully