The Dillon herald. [volume] (Dillon, S.C.) 1894-????, 1920-05-13
Letter on the Staple Cotton Situa-
ton.
Hartsville, S. c., May 10, 19

Dear Mr.. Editor:
1 have recently been giving much
time and study to the present and fu'
ture staple cotton situation and as
sumo that some of your readers might
like to know the results.
The situation as see it is as fol
lows:
First. the supply of good grade
UPLAND staple cotton is practically eX-
hausted everywhere and the demand
is still active. This forecasts an ur-
gent demand for the early part of the
new crop.
Second, the staple acreage in South
Carolina has been increased at least
100 per cent and in Mississippi about
80 per cent, but the crop is getting q
very bad start in both states. In the
latter there is considerable flooded
land which cannot be planted for some
time, if at all. In the Piedmont Sec
tion from Alabama to North Carolina
very little of the crop has been plant
ed-in fact, much of the land ha:
not been plowed for the first time.
Third, late crop is usually poor
one especially in boil weevil terri
tory.
Fourth, the acreage of the Egyp
tian crop which competes with Amer
lean staple has been increased, but
that crop also has an unsavorable
start.
Fifth, 100000 bales of Egyptians
were imported into this country this
season to fill the shortage in the
American staple crop. This leaves
the English mills bare Of supplies
and it is unlikely that England will
allow the expectation of such large
quantities of Egyptians another sea
son unless the Egyptian crop is much
larger than Is expected. High grade
Egyptians are now bringing about
$3.50 per pound.
Sixth, the automobile tire industry
Of the United States will consume
about one half million bales of staple
cotton this year and the demand fol
automobile tires is increasing at the
rate of rs per cent per year. This
will probably mean that 625,00C
bales of staples will be needed fol
this purpose for the coming year. Il
Egyptian imports are curtailed Amer
ican mills may need next season
100000 more bales of American
staples than they used this season
and it is unlikely that the new croI
will show that much increase.
Seventh, while the crop in this
section is late, 1t is earlier than the
Mississippi or Piedmont crop and as
transportation from here is from one
to two weeks quicker to the staple
centers Of New England and the
Carolinas than it is from Mississippi
this section may expect heavy de-
mand during the early part of the
season.
1t is, of course, impossible to pre-
dict future prices as many factors
canont be foreseen. The writer does
not feel, however. that the present
outlook would justify him in selling
any Of his own crop at 20 per cen
to 25' per cent discount from presen
prices as some people are doing.
Some Of the best posted men in thu
cotton world feel that the great
scarcity Of agricultural labor and the
late start and poor stands will make
impossible the production of anythine
but very small crop. The carry
over Of spinnable cotton from this
crop will be very small and when We
consider this and the very high prices
Of all manufactured textiles it would
see that the present level of prices
for all raw cotton might easily be
exceeded this fall.
The writer has always felt that
the sale Of cotton for future delivery
was an unfortunate practice ani
should be discouraged.
First, because 1t has DEPRESSING
tendency on the fall markets as this
cotton is rushed upon the market as
fast as gathered and by swelling re-
ceipts gives the impression of big
crop.
Second, because forward sales
must always be made at heavy dis.
counts under spot prices and the man
who regularly sells his crop at a dis.
count is in the long run going to gel
less than the man who does not sell
until his cotton is ready for the mar.
ket.
Occasionally forward sales will
pay, but millions of dollars more have
been lost by this practice than have
been made.
Yours very truly,
David r. Coker.