rate of exchange. A rise of one per cent in exchange is nearly equal to one-eighth of a cent in the price of cotton. The advance in exchange has been about two per cent over the rates which were current before the discovery of California gold. We were then both exporters and importers of the precious metals. When we were sending them abroad, the price of exchange was the real par, plus the freight, insurance, and other expenses of exportation. When we were receiving them, the price was the real par, less these expenses. The highest rates were 111 or 112; the lowest 104 or 105. The average was about 108 for sixty-day bills. For the past two or three years we have always been exporters of gold, and the range of exchange has been from 108 to 112 at New York; seldom going down to 108 or rising to 112, the average being about 110. This rise in exchange on account of our owning the gold mines of California is a permanent cause. Exchange will be hereafter the real par, plus the cost of exporting specie, and not the real par sometimes increased and sometimes decreased by the cost of exportation. This is equivalent to an advance of one-fourth of a cent in every pound of cotton, and for the year past it produced to the South not less than three millions of dollars. This, though a true cause for an advance in the price of cotton, is not sufficient to account for the whole rise. Another cause may probably be

3d. The increased supply of the precious metals, which by expanding the currency tends to raise the money price of all other articles of merchandise. The large additions of gold to the currency of the world must, by inevitable necessity produce an effect of this kind. No arithmetic can calculate its exact amount in a short period of time: but that it is producing and must produce hereafter a slow, continued rise in all kinds of property no one can possibly doubt. Its first effect is to raise the price of silver; but it is impossible, while the present laws regulating the comparative value of silver and gold at the mints of the world continue unchanged, to raise the premium on silver beyond a very small amount. The effect of a slight advance is to push aside the silver and to introduce gold in its stead. Thus in our own domestic currency, silver is passing out of general circulation, and the vaults of the banks are filling with gold in its place. In France the coinage of gold has of late increased very largely. And so in other countries where both metals are a legal tender. This expansion of the metallic currency gives the banks an opportunity to increase their circulation, and thus the whole monetary medium, by which all the exchanges of Commerce are made, becoming enlarged, the price of all other articles cannot fail to adIt is impossible to say how large an influence this may have had in the recent high prices of cotton. It is not probably large, but that it is real no one can doubt.

vance.

4th. Another cause which has helped to sustain prices, and probably this is more potent than all the others together, is the successful despotism of Louis Napoleon in France, and of the crowned heads on the continent of Europe. The order that has reigned in Paris and throughout France, has given confidence to the merchant and the manufacturer, encouraged labor and industry, given security to property, and stimulated production and consumption in every department of business. Similar causes have been operating in the German and Italian States. The triumph of law and order over the revolutionists of 1848 was not complete until the present year. The iron heel of arbitrary power had crushed the external manifestations of resistance, but the murmurs of discontent were still audible, and the hopes

of liberty were not yet extinguished. The present year has witnessed the end of all these things. Lombardy and Hungary kiss the rod of the oppressor. French soldiers preserve quiet at Rome. The patriots of Naples and Sicily are in prison or in exile. An Austrian army has quelled the disturbances in Baden, Hamburg, and Schleswig-Holstein. Revolution, anarchy, socialism, red-republicanism exist no more. Men have turned their attention to trade, to labor, to the pursuits of peace. Instead of political agitation, the people are employing themselves in new enterprises of industry, of Commerce, and manufactures. The consumption of cotton in France has in consequence outrun any former year. Though stationary for many years past, the demand has suddenly awaked to new life. And so, also, in all the disturbed parts of Europe.

5th. The low price of grain in England, the successful working of free trade, and the prosperity in every department of manufactures, have stimulated the home demand in Great Britain to an extraordinary extent. The exports of cotton fabrics have been encouraged by the peace and prosperity of every part of the world. The overthrow of Rosas has opened the La Plata and its tributaries to British Commerce. The outbreak in Caffraria is unimportant. The war in Burmah being out of India proper has no influence on trade. The rebellion in China does not disturb the exchanges at the free ports. So that universal peace may be said to prevail.

6th. In the United States the onward march of the cotton manufacture has again been resumed. The tariff of 1846, and the high price of the raw material, had checked the demand for the past three years, but the progress of our country in population, wealth, and enterprise, has surmounted these obstacles, and our course has again been forward.

Of these several causes, now enumerated to explain the fair price of cotton for the past year in the face of the abundant supply, there is not one which is not likely to operate for the coming year. We may, therefore, in considering the supply and demand for 1853, anticipate full average prices. They cannot be high, for the supply will be too large to permit any check in consumption. They cannot fall even to the average, for the stocks are low, and any further decline would stimulate the demand even beyond its present extraordinary amount.

The supply from the United States will probably exceed the large crop of 1852. The increased number of hands, the large breadth of land planted in cotton under the stimulus of good prices, the favorable character of the season, the fine weather for gathering the crop after the 1st of October, and the lateness of the frost, will tell strongly in favor of a large production. We have indeed had two severe storms, and with one of them a flood, but their injury has not been serious. The rot also has prevailed to an uncommon extent. The boll-worm has been very general, and in some places severe. The caterpillar has done some harm, but beyond eating the leaves from the stalk, its ravages have been local and unimportant. These causes have not produced as much injury as was suffered last year.

This is especially true in the Atlantic States. The excessive drought inflicted then more damage than all the opposing causes of the present season. The receipts at Charleston and Savannah will therefore exceed those of last year. They will also be increased by the extension of the Georgia Railroad farther to the West. Instead of 800,000 bales received last year, 900,000 may confidently be anticipated for 1853. In Florida, the storm of October 9th did such serious injury that we may expect a falling off in

the receipts at Apalachicola and St. Mark's. More of this cotton will go to Savannah than usual; and the loss from the caterpillar and boll-worm has been considerable. But the increased planting will go far to balance these deficiencies, and only a slight decline may be looked for. From Alabama, the receipts will be larger than last year. There was then too little rain, now there has been too much. The river lands produced finely last season, now it is the sandy uplands that are white with abundance. Only a small increase, however, may be anticipated. From the various districts that send their cotton to New Orleans, the reports are contradictory. The Red River lands are doing very well; the parishes of Louisiana have been injured by the worm, the bottoms of the Mississippi have been too wet; the frost has kept off to a very late period in Tennessee; the planting has been large; the season for gathering long, and nearly the same amount will probably be received as for the past year. From Texas, the reports have been very favorable, and an increase of 25 per cent may be looked for with confidence. The whole crop of American cotton for 1853 may be estimated (see Table II.) at 3,100,000 bales.

The imports from the East Indies have fallen off largely the last year on account of the moderate prices. This has been the uniform effect of a declining market, and we may look with confidence for the same result hereafter. There is in India an immense production of cotton for domestic use. It has been stated to be as large as the crop in the United States, but no satisfactory statistics have ever been collected to show its actual amount. It is, however, very large, and a high price in Europe attracts a larger portion for foreign export. It may then be brought further from the interior, and pay a larger charge for freight. On the contrary, when the European rates decline, the inferior character of the cotton, the heavy expense for freight and insurance for the long voyage, leave but a small balance for the first cost of production, and the carriage from the interior to the seaport. The circle around the marts of export is thus narrowed, and the amount sent off decreases. Thus the high prices of 1850 and 1851 raised the English imports to 308,000 and 329,000 bales, against 182,000 in 1849. The moderate prices of the present year have caused the imports at Liverpool to fall off near 100,000 bales. (See Table III.) The low rates current in December and January last, diverted much of the East India cotton intended for export to China, and the European receipts have been small. No increase in these can be expected for 1853, since prices promise to be moderate, as they have been for the last season.

.The imports into England from Egypt have increased largely for the past year. The largest amount ever before received was 82,000 bales in 1845. The average for the last three years has been 73,000. But for 1852 the receipts at Liverpool alone on the 8th of October had reached 142,000 bales. Less than usual has been carried to France, and so large an amount for England cannot be anticipated for the coming year, especially as the stocks in Liverpool of Egyptian cotton have advanced 50,000 bales. From Brazil and other places, the Liverpool receipts have increased slightly over last year; namely, from 90,000 to 108,000 bales; they are, however, less than for the two preceding years. The average from Egypt and Brazil for the last four years has been about 250,000 bales, (Table IV.,) and this amount may be looked for in 1853.

The total supply from all these places for 1853 may be estimated (Table V.) at 3,550,000, or about the same as last year. This is 685,000 bales

larger than for 1851, and 500,000 larger than for 1849. But, as the increased demand has taken off the whole of the larger production of 1852 at moderate prices, leaving the stocks now smaller than they have been for many years past, (Table VI.,) there is nothing in this large supply calculated to depress prices.

In considering the consumption, we notice everywhere a large increase, not only over last year, but over every former year. The amount consumed in Great Britain in 1851 was 1,663,000 bales, while the largest figures for any previous year were 1,590,000 bales. The deliveries to the trade this year at Liverpool, (see Table VII.,) where 95 per cent of all the English sales are made, exceed those of last year more than 8,000 bags per week. As the factories are now well supplied, this excess will scarcely continue until the 31st of December. But the great regularity in the deliveries forbids any material decline. If the future purchases of the trade should not exceed those of the same period for last year, the consumption of Great Britain would reach 1,992,000 bales for 1852. Nor can we anticipate any less for 1853. The abundance of money, the favorable harvest, the great demand for labor, the high wages in all branches of manufactures, the advance in iron, the prosperity of the shipping interest, the large influx of Australian gold, the universal prevalence of peace in every part of the civilized world, the new machinery erected during the last year, the moderate rates which the raw material promises to bear, the low stocks of goods in the hands of the manufacturers, the large decline in the import of wool, and its consequent advance in price, and the general prosperity, both in the domestic and the export trade, authorize the expectation of a still larger consumption for 1853. There is not a single drawback to this anticipation except the chapter of accidents; but it may be safest, as the increase for the last year has been so unprecedented, to look forward to a demand only as large as for the present year.

The consumption in France has increased as rapidly as in England. Our exports thither have been 120,000 bales larger than last year, and they have caused no accumulation of stocks either at Havre or at Marseilles. The deliveries at Havre alone have increased (see Table VIII.) more than 80,000 bales, and the amount of American cotton for the whole of France will probably exceed 400,000 bales, against 310,000 for 1851. As large a demand for 1853 may be confidently anticipated.

On the continent of Europe the consumption has been steadily increasing. Its progress is occasionally checked by high prices, but these are only temporary disturbances in its onward march. In Russia, the imports for the three years from 1841 to 1843 were 337,000 cwts.; from 1844 to 1846 they were 584,000; and from 1847 to 1849 they were 1,065,000. In the German Zollverein, the protective duties they have imposed have given ample encouragement to the home manufacture of cotton goods. The English and American exports of raw cotton to these and other continental States have averaged (see Table IX.) 417,000 bales in 1847 and 1848; 522,000 in 1849 and 1850; and 582,000 in 1851 and 1852. For the incoming year they will almost certainly reach 600,000 bales, which is a trifle less than the amount for the present season.

The consumption of the United States has made a most sudden and rapid advance during the past year. For the three preceding years we had gone backwards. The high price of the raw material, and the imports of cotton goods at low duties from abroad, had given a check to our increasing de

had

mand, such as we never before had experienced. Hitherto our progress been uniformly onward. The rapid increase in our population and wealth forbids any retrograde movement in the regular operations of business. Just as our railroads, our shipping, our crop of cotton, or of wheat, or of corn, make steady and invariable progress from year to year, so must our cotton manufactures. There will be at times a backward step in this movement, but it is temporary and brief. It is like the oscillation of a pendulum on a moving surface; the weight swings backwards and forwards, but the onward motion of the point of support makes it certain that the forward oscillations will more than compensate for the backward movements. The present prosperity of the country authorizes us to expect an advance even on the large consumption of the past season. The amount for 1852 has reached (see Table X.) 603,000 bales, and 625,000 may be anticipated for the coming year.

The whole demand for 1853 will then be estimated at 3,625,000 bales, (Table XI.,) which is 75,000 more than the anticipated supply. (Table V.) Now, as the stocks on hand (Table VI.) are at present very low, lower than they have been for years past, especially if the time for which they would supply the demand be considered, it would seem that prices must keep above their usual average. This has been 8 cents (Table I.) at the seaports for the last thirteen years, and if the influence of a high rate of exchange and the abundance of gold are to be regarded as real causes elevating the money value of cotton in our markets, it would seem probable that the present prices (9 cents at Charleston, October 29th, for good middling,) will be fully maintained, and that an advance rather than a decline may be expected.