Pine Bluff daily graphic., 1919-03-16
VIEWS
 CURRENT NEWS.
The Cotton Market

The Cotton Market
 New Orleans, March 12.-The in- herent strength of the cotton market was clearly demonstrated by recent events. The sudden action of Con gress in passing the Smith rider to tho wheat guarantee bill, amending the U. s. cotton futures act in such way as to reduce the number of grades deliverable on contract from twenty to ten, caught the trade una wares. Bearish interests which did not relish the action of Congress in depriving them of their weapon, the use of the low, understandable grades in rendering cotton on contract, Sat first made an attempt to stampede the market, but the leading interests which had cotton bought simply laughed at the dire predictions of the element which has been fighting the market for weeks past. The friends of the market took the view that on- ly was there a large speculative in- terest that had cotton heavily sold, but there was also a big interest on the selling held by spot firms that had put out hedges against purchases of spots. As futures have been rum ing all the season at large discounts under spot values, these hedge con- tracts were put in at an apparent less. In other words, the interests that had sold futures against spot purchases or spot holdings, as the sace might be, bod no other alterna- tive than to buy these contracts back, or else be compelled to deliver the actual cotton on their contracts at a loss. This line of reasoning encour- ager the larger interests that had contracts bought to stand pat, and after the first wave of liquidation by small fry 4speculators, who were frightened into selling out, had pass ed, the market immemiately assumed a strong tone. Seing the changed temper of the market, the interests which had the effect of bringing the old style contracts closer to the prices prevailing on the new style contract, on which no cotton below the grade or value of low middling can be de- Bureau of Markets that trading in the old contracts for the purposes of liqui- datiOn woud have to ce&seby May 1st. As many people who lad old contracts bought wanted to receive the actual cotton on contract, all the holders of these contracts had to do was to await the maturity of their contracts and cal flor the delivery of the cotton. The interests which were committed on the seing side, howeveh, did not ! relish the idea of delivering the actual cotton contracts which they had cold Int , the predicament of having to deliver off the bbasis, midling. In consequence of these consid- erations, the demand for old style con- 1 tracts became quite active, and they were bid up as close asfiften points
 to the new style contracts. On the old contracts the advance, as com
 pared with prevailing last Monday before the new law became effective
 amounted to $13 per bale. This put
 old May contracts in the neighbor- l hood of 24 cents, around which leve ] there has been some prOfit-taking ! that has len some profit-taking hrd
 that has served to check the upward
 tendency shown by the contract mar.
 ket.
 l Spots also in this market have re. corded sharp advance recently, midd- l ling in this market today being quot
 ed at P IA cents as compared witt
 26 cents atthe begining of last wek
 Exporters have ben looking around | picking up desirable lists of the bet.
 ter grades. while buyers for theNew England mills have also been buying d S,1, sc khr ihnc o,rs
 dencc M the world that the holding
 movement inaugerated all through the
 Belt is having its effect. Such cotton
 as is being sold in this market is chiefly cotton that was hedged wher the market was at much hikher lecels Offerings of actual spots here are light as they are everywhere else ill the
 Belt. The effect of the outside buy ing by spot interests here has tbeer
 to carry the local spot over other Southern spot markets but, at the
 same, the advance ill spots here
 strengthens all the other markets anC encourages holders all over the Soutl to stand firm for higher prices.
 1 Reports coming in from all portions
 of the Belt as to preparations for the
 new crop being from four to SIX weeks
 behhind a normal year on account of
 the continued rainy weather are caus-
 ing much concern Cn the upart Ol trade interests here. It is realized
 that if the favorable conditions con
 tinue for another week or two, the
 trdae will face critical situation as
 regards the outlook for the new crop This, together with the acreage re l ductic1 movement, spreading all over
 the Belt, is creating a decidedly bull fish sentiment in the market
 l PIRATES AluTlXE