The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1922-11-22
The Crisis in Cotton.

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The Crisis in Cotton.
New York, Nov. Io-The sim.
iIarity of present conditions in the
cotton industry with those of. the
memorable bull season of 10000
Ito which we pointed in our last
review Of October 6th-has been
strikingly maintained during the
month since elapsed. From 20
IL cents for December on oc-
tobes End. prices advanced almost
continuously to $3.50 on November
sth. or ever s3l00 a bale. The
only reaction of consequence oc-
Cured near the "a 1-2 cent mark,
when the trade first felt the pres
ence of new factor in the cotton
wofld-the Farmers Cooperative
Marketing Associations, which have
working organizations now in g
states. Sleeping quietly until that
limit was approached, these Sasso-
ciations suddenly showed life: by
offering for sale considerable
blocks of the cotton held in; pool
for farmers. Equally suddenly,
many bulls with fat profits, pro-
ceeded to sell out, reasoning that.
when farmer leaders were content
with the price, the top OF the sea-
son had been reached. and the
bull movement would come to an
end. The advance halted for a
couple OF days. but in spite of un-
loading of a vast quantity of.specu-
lative longs. prices lost only so
points. of the gain Of AGENTS a
pound. After this brief pause the
upward movement was resumed
and proceeded. almost without re-
action, $500 a bale further to
$3.50 for December.
The new factor-the Farmers
Marketing observation-disclosures.
or rather dema nd. serious consid-
Grafton. All previous efforts I'm
cooperation by growers failed, ],
probably. because farmers and not
business men were the managers.
| In the present instance. cotton
growers have taken a leaf from
the highly successful history of the
California Fruit Growers. and their
selling organization is in the hands
of men thoroughly familiar with
the mill and expert trade and with
connections in all American and
European consuming m ark is.
These. managers profted quickly by
their first experience in making the
offers at "a 1-2. cents. Thereafter
they made no offers. but let it be
known that they had cotton for
sale when prices suited them For
that reason, there has been an an-'
sence7 of the usual spot pressure
on the latest advance, but the
faction of the market, today would
indicate that the associations have
successfully disposed Of consider
able cotton at the new high level.
No doubt more will be for sale
when prices advance still further
but it is safe to say that nothing
will be offered on any declines.
AS usual, when the holder is will
ing to sell, spectators hasten to
take profits, and the market at
the moment is. in consequence. in
a reactionary mood. However, re-
action can only temporarily retard
the next upward movement.
Speculation has been attracted
so strongly to cotton that it may,
for a time, play, as large part in
the. government Of future prices
as the. holding associations them
selves. When scarcity in a COM
modify is threatened. speculative
outsiders invariably buy and take
out Of the market some Of that
commodity in order to profit by the
expected rise in prices. It is easy
to realize that. when the total
available supply Of cotton promises
to be a million bales or more be-
low the needs of spindies, any di-
version or impounding OF part Of
this supply must make the prob
lem. Of feeding the snindles all the
more acute:
Cotton is in a fair way to corner
itself. but. when outsiders take
possession Of a considerable per-
cen;ase' Of available stocks. the
question of forced stoppage be-
comes q serious one. American
mills are fortunate in having fore
stalled the crisis. by making liber-
al provisions for their needs at
much lower prices than those
now, current, and it is Europe
which laust be the sufferer by short
time What makes the situation
lost distressing, is that no relief
can come before a new crop is
ready for markets months or
more ahead.
Where' speculation is rampant
fluctuations are necessarily vide,