Business: Cotton

This has been too good a year for cotton growing—from the viewpoint of the grower. There are 47,207,000 acres to be harvested and each acre is yielding on the average 168.4 Ib. of lint cotton, whereas last year the acre yield was 167.2 Ib. The crop promises to yield a total of 16,627,000 bales of 500 Ib. gross weight each. The price of cotton has fallen below 14c a Ib. and the growers are in a knot of nervous anxiety.

What to do? To restrict the crop artificially, to dump bales from

New Orleans or Charleston wharves would stir up a monstrous protest from not only the ultimate consumer of cotton goods, but also the textile weavers who see, in this cheap cotton, recuperation of their operating losses in recent years. To burn fields would be more obvious and would raise a louder cry. Consequently last week’s damaging rains in Texas were pleasing to growers—else-where—for at present few growers are thinking of their fellows. Even the little boll-weevil and the hopper flea were regarded as less pestiferous—on the other fellow’s plot— than earlier in the year.

Just what to do was explained by many an authority last week:

President Coolidge had appointed a commission (TIME, Oct. 18) to make an immediate survey to determine to what extent the cotton-consuming countries of Europe may be induced to undertake long-term purchases; to urge the domestic spinning industry also to make long-term purchases as a matter of self-protection as well as to check panicky sales; to encourage Southern bankers to back up relief steps and to increase cooperation of Federal farm credit agencies; to restrict the cotton acreage of 1927. The Farm-Labor Board will give $30,000,000 credit to cooperative market associations.

Secretary Jardine wrote to President Edward A. O’Neil of the Alabama Farm Bureau Federation: “. . . The basic economic conditions of the country are sound, and cotton producers must soon realize that the intrinsic value of this crop has not changed in the past few weeks. . . . We have the necessary facilities for storing the crop for months or, if need be, for years, and ample credit to carry it. Cotton in storage is probably the soundest basis for credit that we know. … It is my earnest hope that the present stampede may be checked while the maior part of the crop remains in the hands of the farmers.”

Bernard M. Baruch, in a telegrami to Senator Joseph T. Robinson of Arkansas: “. . . The local banker should see that the man who is aided in holding his present crop limits his production for next year to an amount not exceeding say 60% of his present acreage. All the cotton so held should be placed in the hands of one co-operative organization to sell.”

The South Carolina State Bankers Association moved to take 3,000,000 bales from the market and keep them in warehouses. The Georgia Cotton Growers Cooperative Association resolved: “The management is hereby instructed to give notice to all members that the policy of orderly marketing will be strictly adhered to in the sale of all cotton delivered by all members, and that no cotton will be dumped or sacrificed.” The Tennessee Cotton Conference will force withdrawal from the market (by warehousing) of 4,000,000 bales now, and the reduction of cotton acreage 25% for the next two years. North Carolina bankers and merchants will finance storage if producers will promise to curtail acreage 25% next year, and at the same time increase their foodstuffs acreage.

Publisher David Clark of The Textile Bulletin, Charlotte, N. C., urged every Southern woman to buy a cotton smock.

More profound economists pointed out that cotton losses will reduce the South’s purchasing power and so affect all other sections of the country from which it buys.