New-York tribune., 1920-11-28
Silver Market
Sustained bv
Chi1na's Buying; g
Further Decline in Foreign
Metal Prices Would Not
Be Surprising; Situation
Helps L. S. Producers

A further sharp decline in foreign
silver prices would not be surprising
70 observers of world conditions for
this commodity. About all that is sus-
tanning the market at present is Chi
nese buying. which has been on
large scale for months, and Asiatic
conditions are none too rosy. The re-
port OF an impending famine in China
IS depressing factor.
The condition Of China's export
trade, which has dwindled steadily. con
tributes to the uncertainty Of the stu
alton. and the prospects OF continued
support from this source are not bright.
Under better circumstances China
might easily absorb offerings Of silver
20 replace shipments made to India
during the war and for use in the in
terror Of Asia. where paper money has
fallen into disrepute. Russian money
was formerly used in this section. 1t
is estimated that from $4,000, 900 to
90 OOO,0 ounces of silver would be
taken annually for use in this way
under normal conditions.
The change which has sent most OF
American exports to China instead Of
TO India is interesting. During the
first n.ne months of last year India
received S1o9 900 900 of the metal from
the United States, while China, includ-
ing EongSong, took S34,000.000 In
similar period this year China, with
Hongkong, took $76,0000 900 in silver,
while India imported only 1929, 900
from the United States. These figures
show the supporting influence of Chi
nese buying.
Domestic Producer Aided
Although foreign silver prices are
tending downward, the American prod
uct Is being sustained by the Pttman
act, by which the government pur-
chsses domestic silver at 81 an ounce.
At the rate the Treasury has made pur-
chases since May, when it was first
called upon to take action as a resul. of
the price collapse, it will take about
four and half years to complete the
purchase of the entire 20G 100000 oz
according to The Engineering and Min
ing Journal, which points out the fact
that the American producer is placed
in favorable position. Whereas the
general economic tendency in COM
modify prices is downward, yet the sill
yer producer will realize fixed price
for his product for some time to come
The average price Of foreign sill
YER says The Journal, "since its drop
below 81 and up to November IS
seem that the American silver pro-
ducer on his sale of 23,000,000 ounces
Of silver TO the government has real
lied about 10c above the market,
equivalent to about $4,000 900 above
the outside market prices AS the
price of mining supplies drops the cost
of silver mining should decrease. This
is an important consideration for the
silver miner, as, even with the price
Of silver at 81. frequent complaint is
heard about the high cost Of produc-
ton
The average monthly price of for
eign silver has declined in steps since
the first Of the year, and, judging from
the declines that occurred in other
commodities, the reputation of silver
as an economic barometer is strikingly
sustained The drop in silver took
place several months before the gen
eral commodity price decline. but was
greatly retarded by the stablizing eff
feet Of the Pittman act. with its result
ant withdrawal Of American silver
flom the market.
1870 AVERAGE PRICES OF FOREIGN
SILVER AT NEW YORK CITY