217 



The most salient point about the above statistics is, in the main, 

 that a high rate of exchange has meant a high price for coffee. 

 The apparent exception in 1900-I when the coffee quotations did 

 not rise in proportion to the rise in exchange was due to tlie fact 

 that the latter was caused by speculation, not in coffee, but in 

 exchange itself. The present rise in exchange is attributed to the 

 confidence inspired by the improved state of the country, and con- 

 sequent investment of foreign capital. The government has also 

 for the past few years been withdrawing the paper currency from 

 circulation. The principal result of a high exchange is that the 

 " Milreis" price received by the planters is reduced and that with 

 his cost of production remaining constant, he must reduce his out- 

 put of coffee. A particularly fine crop of coifee however would 

 depress prices, even though the rate of exchange were on a higher 

 level than at present. 



It is also noticeable, however, that while consumption has been 

 satisfactorily increasing, production has been falling away from 

 the high point of 1901-2, and this, quite apart from the exchange 

 question, is encouraging to the producers of coffee. 



The following is from Messrs. Gillespie's fortnightly market 

 report of same date : — 



Coffee. — The activity of the coffee market is still pronounced, 

 though a large part of the sales reported are in reality only 

 speculative transfers from, say, September options to December, 

 or later. The receipts reported from the interior of Brazil are, 

 however, on a smaller scale than is usual at this season of the 

 year, and the " bulls" are busy with reports of a large decrease in 

 the total crop. They are helped in their arguments by the present 

 high rate of Brazilian exchange, which is now in the neighbour- 

 hood of l/fd. This is always expected to send up the price of 

 coffee, as with a high exchange the expenses of cultivation become 

 heavier and the tendency is to curtail production. The quotation 

 for No. 7 Rio to-day is 8|c. per lb., and the tendency is toward 

 higher prices, though traders would in most cases prefer to see the 

 new crop open at a lower figure. Mild coffees are firmly held, 

 and a considerable business has been done lately. Good average 

 Bogota has been sold at from ll|c. to Iljc. per lb., and good 

 Cucutas are quoted at from 9|c. to 9|c. per lb. The supplies of 

 Jamaica coffee are practically unimportant, and, in the absence of 

 sales, quotations are nominal. Good ordinary Jamaica coffee is 

 probably worth from 8|c. to 9c. per lb., better grades up to lie, 

 per lb., according to quality. 



Our London house cables us to-day the spot quotations : For 

 fair ordinary Jamaica coffee 41/ per cwt., market firm ; for good 

 ordinary greenish Jamaica coffee 44/ per cwt., market firm and the 

 c. i. f. Havre quotation for fair ordinary Jamaica coffee 42/ per 

 cwt., market firm. 



