The herald and news. [volume] (Newberry S.C.) 1903-1937, 1907-01-08
MR.. E. D. SMITH
ISSUES ADDRESS
DISCUSSES THE COTTON MAR
KET SITUATION.
All Fighting the Producer There
fore the. Farmers, Having a
" Monopoly, Should Offer
Concerted Resistance.
TO the People Of South Carolina:

!. TO the People of South Carolina:
f We have just passed through per-
Y haps the most peculiar year in the
growing of cotton and are passing
trough now an equally strange one
in the marketing Of it. East Of the
Mississippi an unprecedented season
in the growing OF cotton was expe-
. rienced.
This section suffered two of the Sc
verest storms that ever visited the
cotton belt. A frost, earlier by three
or four weeks than ever visited the
belt and with more disastrous results.
West of the Mississippi the growing
season was perhaps above the aver
age, the gathering season fairly good,
the yield promising to be in this Sec
ton phenomenally large. In the ear
lier ginners' reports these conditions
and their results seemed to be borne
out. In the later ginners' report, to
the surprise of, every one interested
in the cotton business, the yield in
the frost and storm stricken section
was surprisingly large and in like
proportion the return from the fav-
ored section was correspondingly
small.
In addition to these surprising and
disturbing facts, the New York en-
changes met and widcncd the differ
ence in the value Of grades SO much
SO that the better grades Of cotton
in place of commanding the ordinary
difference Of Is to Ia per cent.
premium have advanced from 1875 to
as high as IT'S points difference. A
man having spot cotton, under these
conditions, had no practical idea Of
what his cotton was worth.
In addition to this, the broad price
or the future market, which in form
er years indicated the value of cot
ton delivered in New York and in New
Orleans basis middling, now has no
relation whatever to any such rela-
tive value. Today, for instance, jan
uary, the spot month, is quoted in
New York at 9.47 basis middling,
while middling spot cotton in the
same market is quoted a 1915, and
the same grade Of spot cotton would
readily bring 1915 or more on our
local market. All this confusion is
the result Of the disturbing factor of
the farmers, the producers of spot
cotton, demanding the value of their
product. Heretofore the price of cot
ton was fixed arbitrarily by the New
York exchange and the value of mid
ding cotton and other grades was de-
termined by deducting the carrying
charges from here to New York from
the New York quotations. Today the
value Of spot cotton in the South is
determined entirely by the disposition
Of the farmer to sell.
In the last few months T have WIS.,
tied most Of the cotton growing
States, and found throughout the
South that there is among the masses
Of growers clearer knowledge Of
the general situation and a more prac-
tical conception Of what is necessary
to meet the conditions for the bene-
fit Of the producer Of cotton, and a
clearer idea Of the common laws oS
business involved in the transaction
of production and sale, supply and
demand, and that is surely working
a revolution in the cotton business.
1t is eliminating to large extent the
effect Of gambling in futures on the
4 value Of spot cotton and is rapidly
divorcing the gambling factor from
the legitimate trade in the actual
A stuff. ...u. =. ..'. ..
Another element which is tending
to bring about this result is the fact
that the unprecedented demand for
cotton goods through the world is
enabling the mills to contract for their
output on a basis where they can pay
remunerative price for cotton and
tilll, declare a large dividend for their
tockholders. The Southern mills al
p having. the advantage Of position
IAN pay more for the cotton at their
foors3 than mills not 50 fayorably sit
Hated The rapid increase insthe con-