THE BRITISH COTTON TRADE 

London, Sept. 21, 1861 

The continual rise in the prices of raw cotton begins at last to 
seriously react upon the cotton factories, their consumption of 
cotton being now 25 per cent less than the full consumption. This 
result has been brought about by a daily lessening rate of 
production, many mills working only four or three days per week, 
part of the machinery being stopped, both in those establishments 
where short time has been commenced and in those which are still 
running full time, and some mills being temporarily altogether 
closed. In some places, as at Blackburn, for instance, short time 
has been coupled with a reduction of wages. However, the 
short-time movement is only in its incipient state, and we may 
predict with perfect security that some weeks later the trade will 
have generally resorted to three days working per week, concur- 
rently with a large stoppage of machinery in most establishments. 
On the whole, English manufacturers and merchants were 
extremely slow and reluctant in acknowledging the awkward 
position of their cotton supplies. 

“The whole of the last American crop,” they said, “has long since been 
forwarded to Europe. The picking of the new crop has barely commenced. Not a 
bale of cotton could have reached us more than has reached us, even if the war 
and the blockade?6 had never been heard of. The shipping season does not 
commence till far in November, and it is usually the end of December before any 
large exportations take place. Till then, it is of little consequence whether the 
cotton is retained on the plantations or is forwarded to the ports as fast as it is 
bagged. If the blockade ceases any time before the end of this year, the probability is 

that by March or April we shall have received just as full a supply of cotton as if 
the blockade had never been declared.” @ 

In the innermost recesses of the mercantile mind the notion was 
cherished that the whole American crisis, and, consequently, the 
blockade, would have ceased before the end of the year, or that 
Lord Palmerston would forcibly break through the blockade. The 
latter idea has been altogether abandoned, since, beside all other 
circumstances, Manchester became aware that two vast interests, 
the monetary interest having sunk an immense capital in the 
industrial enterprises of Northern America, and the corn trade, 
relying on Northern America as its principal source of supply, 
would combine to check any unprovoked aggression on the part of 
the British Government. The hopes of the blockade being raised 
in due time, for the requirements of Liverpool or Manchester, or 
the American war being wound up by a compromise with the 
Secessionists, have given way before a feature hitherto unknown in 
the English cotton market, viz., American operations in cotton at 
Liverpool, partly on speculation, partly for reshipment to America. 
Consequently, for the last two weeks the Liverpool cotton market 
has been feverishly excited, the speculative investments in cotton 
on the part of the Liverpool merchants being backed by 
speculative investments on the part of the Manchester and other 
manufacturers eager to provide themselves with stocks of raw 
material for the Winter. The extent of the latter transactions is 
sufficiently shown by the fact that a considerable portion of the 
spare warehouse room in Manchester is already occupied by such 
stocks, and that throughout the week beginning with Sept. 15 and 
ending with Sept. 22, Middling Americans had increased 3/8d. 
per lb, and fair ones 5/8d. 

From the outbreak of the American war the prices of cotton 
were steadily rising, but the ruinous disproportion between the 
prices of the raw material and the prices of yarns and cloth was 
not declared until the last weeks of August. Till then, any serious 
decline in the prices of cotton manufactures, which might have 
been anticipated from the considerable decrease of the American 
demand, had been balanced by an accumulation of stocks in first 
hands, and by speculative consignments to China and India. Those 
Asiatic markets, however, were soon overdone. 

“Stocks,” says The Calcutta Price Current of Aug. 7, 1861, “are accumulating, the 
arrivals since our last being no less than 24,000,000 yards of plain cottons. Home 
advices show a continuation of shipments in excess of our requirements, and so 
long as this is the case, improvement cannot be looked for.... The Bombay market, 
also, has been greatly oversupplied.” 

Some other circumstances contributed to contract the Indian 
market. The late famine in the north-western provinces has been 

succeeded by the ravages of the cholera, while throughout Lower 
Bengal an excessive fall of rain, laying the country under water, 
seriously damaged the rice crops. In letters from Calcutta, which 
reached England last week, sales were reported giving a net return 
of 9'/,d. per pound for 40s twist, which cannot be bought at 
Manchester for less than 11°/sd., while sales of 40-inch shirtings, ° 
compared with present rates at Manchester, yield losses at 7’/2d., 
Qd., and 12d. per piece. In the China market, prices were also 
forced down by the accumulation of the stocks imported. Under 
these circumstances, the demand for the British cotton manufac- 
tures decreasing, their prices can, of course, not keep pace with 
the progressive rise in the price of the raw material; but, on the 
contrary, the spinning, weaving, and printing of cotton must, in 
many instances, cease to pay the costs of production. Take, as an 
example, the following case, stated by one of the greatest 
Manchester manufacturers, in reference to coarse spinning: 

Cost of 
Per lb. Margin. spinning 
per lb 
Sept. 17, 1860. 
Cost of COtton ......cceeeeeeeee 6) /4d. 4d. 3d. 
16s warp sold for ........... 10!/4d 
Profit, ld. per lb. 
Sept. 17, 1861. 
Cost of COtton were Od. 2d. 31/od. 

16s warp sold for .............2. 1] 
Loss, 1 !/9d. per Ib. 

The consumption of Indian cotton is rapidly growing, and with 
a further rise in prices, the Indian supply will come forward at 
increasing ratios; but still it remains impossible to change, at a few 
months’ notice, all the conditions of production and turn the 
current of commerce. England pays now, in fact, the penalty for 
her protracted misrule of that vast Indian empire. The two main 
obstacles she has now to grapple with in her attempts at 
supplanting American cotton by Indian cotton, is the want of 
means of communication and transport throughout India, and the 
miserable state of the Indian peasant, disabling him from 
improving favorable circumstances. Both these difficulties the 
English have themselves to thank for. English modern industry, in 
general, relied upon two pivots equally monstrous. The one was 
the potato as the only means of feeding Ireland and a great part of 

the English working class. This pivot was swept away by the potato 
disease and the subsequent Irish catastrophe.”’ A larger basis for 
the reproduction and maintenance of the toiling millions had then 
to be adopted. The second pivot of English industry was the 
slave-grown cotton of the United States. The present American 
crisis forces them to enlarge their field of supply and emancipate 
cotton from slave-breeding and slave-consuming oligarchies. As 
long as the English cotton manufactures depended on slave-grown 
cotton, it could be truthfully asserted that they rested on a twofold 
slavery, the indirect slavery of the white man in England and the 
direct slavery of the black men on the other side of the Atlantic.