the principal articles of export, more particularly cotton fabrics,
were perhaps never more promising; and it is evident that the late
disturbing causes, political and social, in Europe and India, with the
effects produced upon other countries, reducing the consumption of
cotton to 22,230 weekly in 1847, and 27,602 in 1848, (previously
upwards of 30,000 bales weekly,) created a vacuum which has not been
filled up by the increased consumption of 30,512 bales weekly in the
present year; indeed it would seem that this large quantity (and it
has been proportionately great in other cotton manufacturing
countries) has only been sufficient to supply the increasing wants of
the world, as we no longer hear of glutted markets, but the report is
of light stocks almost everywhere. And when we take into consideration
the low price of all articles of food, corn particularly, (a
questionable advantage, perhaps, when unnaturally low, if the home
market is to be considered of any value,) the great abundance of
money, its low value, not exceeding, perhaps, 2½ per cent per annum in
the London market, with a larger amount of gold, &c. (£17,000,000) in
the Bank of England than was ever known before, it is evident that a
great stimulus may be given to the trade of the country, and that with
the disfavour shown to railway property it is most likely the usual
effects will follow—viz., extensive speculation and greatly enhanced
prices of all articles of import, and of cotton in particular.”
The whole of the trade circulars, indeed, both from Liverpool and
Manchester houses, expressed similar views with respect to the prospects
of the present year; and seemed to expect an increase in the aggregate
manufactures of the country. In reviewing the actual state of things
which has taken place, I would direct your attention particularly to the
fact of spinners and manufacturers being “under contract” at this
period, as stated in the first circular from which I have quoted. Such
contracts could only have been entered upon, consistently with prudence
at least, in the anticipation of a continuance of the then existing
prices of the raw material, or upon the assurance of a stock already in
hand. To a considerable extent spinners did hold stock sufficient for
the fulfilment, profitably, of a portion of their contracts, as is shown
by the circumstance that they have, since the commencement of the year,
worked up about 40,000 bales of cotton more than they have drawn from
the Liverpool market. That in the majority of cases, however, the stocks
held were only sufficient to complete a portion of the contracts entered
into is a fact which is quite beyond dispute; and these parties have
consequently been driven into the market to purchase the raw material at
the ruling prices of the day. In order to ascertain their position, it
will be necessary to trace the relative prices of cotton and of goods
during the interval between December 1849 and the present time. Up to
the commencement of that month, the prices of the raw material had been
gradually rising; and the almost universal complaint of spinners and
manufacturers had been of the unwillingness of buyers to pay a
proportionate advance upon goods. Thus, on the 1st of June last year,
the price of fair bowed cotton was 4¼d. per lb., from which it advanced
gradually, owing to reports of a short yield of the crop in America,
until on the 1st of January this year it stood at 6⅜d., being an advance
of 2⅛d. per lb. The price of best seconds water twist, No. 20 was on the
1st of June 6¾d., and on the 1st of January 8¼d. The price of best
second mule, No. 40, was at the same dates respectively 8½d. and 10½d.
We had therefore—
Advance upon cotton, . 2⅛d. per lb.
Do. upon yarn, No. 20, 1½d. „
Do. upon yarn, No. 40, 2d. „
This was obviously a losing trade; and it is acknowledged that, during
the whole of this period business was only profitably carried on by the
fortunate few who had laid in stocks at the low prices. On the 1st of
February the highest price was attained, fair bowed cotton being quoted
at 6⅞d., with No. 20 yarn at 8¾d., and No. 40 at 11¼d.—being an advance
of ½ on the raw material, ½d. on the No. 20 yarn, and ¾d. on No. 40. To
counteract the upward tendency of the market, a resort to the working of
short time was resolved upon, principally by the spinners of coarse
numbers; and the consumption was thus materially reduced, spinners and
manufacturers drawing upon their stocks on hand, and thus keeping out of
the markets for the raw material. A gradual decline in the price of
cotton was the result—goods, however, sharing in the depression; and on
the 1st of April fair bowed was quoted at 6⅛d., or ¾d. per lb. lower
than in February. No. 20 yarn, the stocks having been reduced by
short-time working, had declined only ½d. per lb.; No. 40, however, had
fallen to the same extent as cotton. There was therefore no increase of
prosperity brought about thus far by the short-time movement, the price
of goods remaining at the same unsatisfactory point as compared with the
raw material.
At this date, Messrs Robert Barbour and Brother of Manchester, in their
monthly circular, speak as follows with respect to the general trade of
the cotton manufacturing districts:—
“We have to report a very dull and unsatisfactory state of business in
this district during the month. There has been a gradual decline in
prices varying from 2½ to 7½ per cent, so that some kinds of goods can
now be bought fully 10 to 12 per cent under the rates which were
demanded in January. These reduced quotations have induced some
parties to enter the market, but still the demand has been much under
the average of what is usually experienced at this season of the year.
The working of ‘short time’ is now generally adopted by the producers
of coarse yarn and heavy goods, and several large mills continue
closed. The drooping tendency of some descriptions of the finer
fabrics has been slightly counteracted during the last week by more
favourable intelligence from Calcutta and China; still, however, our
market is unsteady, and it is more than usually difficult to form any
idea of what is likely to be the future course of prices.
“In the goods market a general quietness has prevailed throughout the
month, buyers acting with extreme caution, purchasing only in small
parcels for the supply of their more pressing wants: prices,
consequently, have been irregular, and some considerable sales have
been made by needy manufacturers at very low rates.”
The dulness here spoken of is particularly observable in the staple
articles consumed by the home trade. Messrs Barbour and Brother state
that—
“36-inch shirtings have participated in the general depression, and
stocks are beginning to accumulate. 66-reeds, 7¾ lb., have receded in
value 6d. to 9d. per piece, having been sold in February at 8s. to 8s.
4½d., whilst now they are worth only 7s. 6d. to 7s. 9d.”
Again:—
“Domestics T cloths and stout long cloths continue neglected,
notwithstanding the curtailed production, and can now be bought on
easier terms. Average qualities of domestics have been sold at 9d. per
lb., which is by no means remunerative to the maker.”
The concluding paragraph of the circular is very decisive as to the
comparatively profitless nature of the manufacture:—
“Cotton has now declined about 1d. per lb. during the last three
months. It is still, however, much higher than is warranted by the
prices which can be obtained for the manufactured article. Indeed, _at
several periods during the last few years, prices of yarns and goods
have been quite as high as those now current, with cotton at 1d. to
2d. per lb. lower than at present_.”
Since the date of the circular containing these gloomy accounts, an
important change has taken place, and the tide has set in strongly
against the manufacturing community. Immediately subsequent to its
publication, the arrival of the American mail-steamer brought news
confirmatory of the anticipations of a short crop of cotton, and prices
immediately advanced, leaving the spinners and manufacturers to recruit
their exhausted stocks at a further loss, as compared with the prices of
goods. On the 5th of April, the receipts of cotton at the ports of
America were shown to be 310,000 bales less than at the same period of
the preceding year; whilst the stock computed to be held in Liverpool
was 511,000 bales, as compared with 447,300 bales held at the same date
in 1849, or only 63,700 bales more than last year, although spinners had
decreased their consumption by 6300 bales per week, and taken 40,000
bales from their own stocks. The total crop of the United States, which
had been estimated in the beginning of the year at from 2,250,000 to
2,300,000 bales, was only estimated in the advices by the steamer at
2,100,000 bales.
I fear that, to some readers, these statistics may be rather tedious.
They are necessary, however, to enable us fully to understand the
position in which this important branch of the manufactures of the
country, and the large population dependent upon it, have been placed by
the intelligence brought by another later mail from the United States,
which arrived in the Mersey on the morning of the 16th ult. I have
stated that the estimates formed of the probable crop in America, at the
beginning of the year, varied from 2,250,000 to 2,300,000 bales. These
had been reduced, up to the arrival of the steamer in the first week of
April, to 2,100,000 bales. With this progressive decline going on in the
amount of the crop, as estimated by competent judges upon the spot, and
with the fact of decreased receipts at the American ports before their
eyes, the spinners of this country have, with few exceptions, resolutely
refused to give credit to the representations made to them, and kept
further exhausting their stocks on hand, or buying only to supply their
immediate wants. The arrival of the Niagara, however, has put the
question at rest, and not only confirmed the statements as to the crop
being a short one, but established the fact that it is likely to be much
shorter than was by anybody anticipated. The following is the startling
disclosure made by Mr T. J. Stewart of New York, one of the best
authorities in the United States, upon the subject, in his circular of
the 2d ult.:—
“The crop proves to be a short one—and if measured by the ability of
the world to consume, the shortest one since ’41–’42. The falling off
in the receipts regularly exceeds the progressive estimate I made some
time since, and on which I made up my table of 2,100,000 bales. It
will close _under two millions of bales_. How far below, I cannot at
present say, but the interior of the country is exhausted of supplies
to so great a degree, that it is evident that such a figure is totally
impracticable.”
The decrease in the stocks arrived at the ports of America is put down
by him now at 470,000 bales. Of this very insufficient crop of less than
2,000,000 bales—that of the preceding year, I may remark, was
2,728,000—Mr Stewart reminds us that _America will require above 600,000
bales to supply her own mills, or nearly two-fifths of the total
quantity consumed in Great Britain last year_. This, of itself, is a
somewhat startling fact, and proves the rapid strides which America is
making toward depriving this country of its manufacturing pre-eminence.
It is obvious, from the above circumstances, that the American planters,
and the holders of cotton in that country and in Liverpool, have the
manufacturer at this moment within their grasp, and will be enabled to
extort from his necessities still higher prices than those which have
for months past rendered his business a losing one. The stocks of cotton
held in the manufacturing districts are unprecedentedly light, and those
of goods have been of late considerably reduced. But can an advance be
secured on the manufactured article, corresponding with that demanded
for the raw material? Few people believe this to be practicable. With
the exception of a little temporary activity in the demand of goods for
the East Indian market, towards the middle of last month, the gloomy
feeling existing in every branch of the trade had deepened, and the
demand for nearly every article perceptibly lessened. The accounts
received by export houses from foreign markets are not of a character to
encourage further operations; and the demand for the home trade remains
very limited. In broad terms, _the leading foreign markets are glutted
for months to come, and the population throughout the agricultural
districts, and in the large towns of the kingdom as well, are
diminishing their consumption of cotton and other fabrics to the lowest
possible point_. With respect to the foreign trade, the worst feature is
the falling off in the demand from the United States, to which I showed
that, in the first two months of this year, we had shipped goods equal
to the one half of last year’s exports. The returns for these shipments
may be expected to be very unsatisfactory. On this subject, the last
steamer (the Niagara) brought the following report:—
“The spring trade of New York _had disappointed all classes_. Early in
January there was an unusually active demand. High prices were
obtained, and large sales were made; since then business had fallen
off, and _the month of March, which ought to have been the best, had
been extremely dull—more so than had been known for many years_. The
stock of British and other foreign dry goods was not large, but the
demand was small.”
From this market, expectations of the most sanguine character had been
previously indulged in, which are thus rudely dashed to the ground.
As yet the manufacturing community, stunned by the conviction which has
been forced upon them of their desperate position, have formed no
definite resolution as to the course to be pursued. For a week or two
longer, it is possible that a portion of them may make further fruitless
efforts to keep down the market for the raw material, which will now be
held by speculators, aided by the abundant funds in the hands of
bankers, with the certainty of ultimately realising higher rates. In the
opinion of parties acquainted intimately with the whole circumstances of
the trade, the only available course for spinners is to decrease
consumption still further, by an extension of the system of working
short time, or by closing a considerable portion of the mills
altogether. Profitable working, even without an increase in the price of
the raw material, is out of the question, with markets in their present
depressed condition. But with such an advance as must be paid, if even
the present reduced rate of consumption is to go on, the business would
be perfectly ruinous.
It is painful to reflect upon the severe suffering which must be
entailed upon the operative and middle classes, throughout the
manufacturing districts, by a general suspension of operations, or even
by an increase of short-time working. These classes, greatly reduced as
their wages have been during the past two years, have not, I may repeat,
recovered as yet from the effect of the suspension of manufacturing
activity to which they were forced in 1847 and 1848; and are
consequently in a much worse position to be thrown again upon their own
resources. The neatly furnished cottage no longer remains to be
dismantled for the purpose of providing food for their families. The
little savings’ bank hoards disappeared in those years, and have not
since been replaced. A few employers, no doubt, may be disposed to allow
to their hands a pittance sufficient to provide against actual
deprivation; but it is to be feared that the mass will act with no such
humane considerateness. Another result of such a course must be still
farther to decrease the consumption, and depress the prices, of our
large stocks of imported produce, and thus to inflict heavy losses upon
their holders.
It is to me perfectly clear, and the fact is tacitly admitted by a large
portion of the community engaged in mercantile and manufacturing
pursuits, that a most trying and fearful crisis is at hand; and that the
present summer will not end without her Majesty’s Ministers, and the
Free Trade party, being compelled to acknowledge that the speech from
the Throne, and the representations of prosperity made by them at the
opening of Parliament, were, if not deliberate perversions of the truth,
at all events most ill-considered and hasty. We had in February last, it
is now evident, no such thing as even prosperous manufactures, or a
healthy state of commerce. Whilst these representations were being made,
and agricultural pursuits alone pointed to as being in a state of
temporary depression, the leading manufacture of the country was being
carried on without profit, and our merchants and traders were feeling
the ground shake beneath their feet. It is of no use, however, to refer
to the past. The questions for the nation now to consider are—first,
What is it which has brought about this general prostration of the
country? and next, Where is the remedy to be applied? It is idle for the
Free-traders to point any longer to potato rots, to railway manias, or
to high prices of cotton, as the cause of the failure of their
predictions of coming general prosperity. The truth is palpably before
the world that the foreign trade, stimulate it as we may, will not
employ the industry of the country; and that a prosperous home trade is
indispensably necessary to render the foreign trade a profitable one. It
is equally idle to tell us that the present state of things is only
temporary, and that a different result of our recent policy will be
attained by and by. In what direction are we to look for the change? Is
any new world about to be discovered? Is there a single outlet to be
found for our manufactures, which we cannot close up in a month? I
confess that I cannot discern a gleam of hope for the future, or a
prospect of the restoration of this great nation to its wonted
prosperity, except in a total reversal of the legislation of the past
few years, by which, and by which alone, has been caused that
prostration of its industry and enterprise, which we are now witnessing
on every side—in our own once happy land, and throughout the length and
breadth of that vast colonial empire, once the pride of Great Britain,
and the envy of the world, but now her shame, ruined and robbed as it
has been by the legislation of designing or incapable statesmen. With
our agricultural population fast sinking into pauperism and insolvency,
or taking flight from our shores, as from those of an infected land, to
fertilise with their capital and enterprise other soils, which own
protective governments and a kindred people; with the landed aristocracy
of the kingdom, and squirearchy and the yeomen, stripped of half their
possessions—the baronial hall no longer distributing its hospitality to
thousands, and pinching poverty and thrift marking the household
arrangements, where of old there was plenty, a cup for the needy, and
consolation and succour for the afflicted; with the middle classes in
our towns forced down in the social scale, and hovering over the gulf of
insolvency and ruin, and the labourer turned out, a desperate man, to
wrest with the strong hand the food which we deny him the means to
purchase, whilst we mock him with its cheapness—the manufacturing body
will strive in vain for the consummation of that object which, in their
selfishness, they proposed to themselves as the result of the boasted
Free-trade policy—viz. the setting up of their houses over those of the
time-honoured names of the land. Blindly and madly they have detached
the handful of snow from the summit of the mountain; with mocking jeers
of hideous and idiotic glee, they have seen its gathering bulk, and
watched its progress as it rolled, prostrating the cottage and the
farmstead, and spreading devastation over the vineyard and the waving
corn; and they stand now shuddering at the mighty avalanche which is
thundering above the tall chimney and the smoky town, and will shortly
involve themselves in the general calamity and devastation. Yes, the
fears of these men are at length beginning to be effectively roused by
the contemplation of the work of their own hands. I say _beginning_,
because the day of retribution is only now coming upon them, and making
itself felt. The philosophers of the loom and spindle talk now “with
bated breath” of the efficacy of their universal specific. There are
doubting anxious faces on ‘Change, gloomy greetings as they meet in the
streets, and idle hands in the once busy salerooms and warehouses. Many,
whose voices were lately loud in cheering the flattering tales and
sophistries of their Cobdens and Brights—some of those even whose
subscriptions enabled the former to buy his Woodland farm, and whose
votes and influence hoisted the blustering Quaker into a seat in the
Legislature, are now ready to acknowledge, in private, that “there is
some mistake;” that they have, perhaps, gone too far; and that, after
all, Free Trade is “only an experiment.” Alas! it is one whose fatal
effects will have to be deeply deplored, and from which the country will
not recover for years to come. A quarter of a century of toil will
scarcely replace the capital which has been swept away, up to the
present period. More remains to be swept away; but now it will be the
capital of the authors of the calamity.
And this portion of these philosophers are busily and eagerly striving
to persuade the farmer that he is foolishly nervous under the
apprehension of permanent low prices; and that these have now reached
the level at which the foreigner can no longer supply us profitably.
Unfortunately, whilst they are sagely assuring the world of this fact,
grain and flour keeps steadily pouring into our ports, at still further
reduced prices; and additional evidence is daily being afforded of the
total ignorance of the subject displayed in their statistics and
calculations: supplies are reaching us daily from countries which were
left altogether out of the catalogue of those from whose growers we were
led to anticipate competition. Thus from France, a country which it was
always said was not able to grow sufficient for its own consumption, the
receipts at the port of Liverpool during two weeks, in which alone the
quantity is quoted separately, were as follows:—
French flour.
Week ending March 19, 6000 barrels.
April 9, 6166
and 2419 American.
And from that country, and the whole of the ports of the North of
Europe, distant from us by only a few days’ sail—by a voyage made in
less time than the average consumed in those made from port to port on
our own coasts—supplies will continue to come, at rates with which the
British grower can never hope to compete. In fact, the farmer of the
North of Europe may in future be treated as a British subject—enjoying
all the immunities of one, without contributing towards his burthens. He
is nearer the London or the Liverpool markets than a Norfolk or a
Lincolnshire farmer; and that he frequently pays less for the conveyance
of his produce than it will be seen from the following table, which
contains the rates actually paid in Liverpool by importing houses during
the years beginning in 1847 to this year, such farmer pays:—
COASTING and FOREIGN FREIGHTS of WHEAT to LIVERPOOL.
┌─────────────────┬──────────────────┬──────────────────┐
│ │ 1847. │ 1848. │
├─────────────────┼──────────────────┼──────────────────┤
│ │ Per quarter. │ Per quarter. │
│ │_s. d._ _s. d._│_s. d._ _s. d._│
│From Stettin, │5 0 │ │
│ „ Dantzig, │4 6 │4 0 │
│ „ Rostock, │6 0 │4 0 │
│ „ Hamburg, │4 0 to 3 6 │4 0 to 3 0 │
│ „ Rotterdam, │ │2 6 │
│ „ Antwerp, │ │3 0 to 2 6 │
│ „ Bremen, │ │3 3 to 3 0 │
│ „ Bruges, │ │ │
│ „ Ghent, │ │ │
│ „ New York, │ │ │
│ (last │ │ │
│ rates,) │ │ │
│ │ │ │
│_From Coasts of │ │ │
│ England to │ │ │
│ Liverpool._ │ │ │
│ Colchester, │2 0 │2 0 │
│ Woodbridge, │2 6 │2 6 │
│ Salcombe, │2 6 │2 6 │
│ Kingsbridge,│2 6 │2 6 │
│ Lynn, │2 6 │2 1 │
│ Ipswich, │2 3 │1 9 │
│ Yarmouth, │2 1 │ │
└─────────────────┴──────────────────┴──────────────────┘