January i, 1885.] 



THE TROPICAL AGRICULTURIST. 



57S 



POSITION OF THE TEA TRADE. 

 From the Rome & Colonial Mail we learu that at 

 a meeting at Messrs. Thompson & Co. 's office it was 

 settled that small breaks of tea, which are defined 

 as "all breaks under 8 cheats or half chests and 20 

 boxes," should be passed over at the time of sale of 

 the large breaks and disposed of at the close of the 

 day. This arrangement is made in favour of the large 

 buyers, but the smaller breaks will probably not Fuller. 

 We do not know what the experience of other export- 

 ers of tea may have been, but in our own case we 

 have found that breaks of about 2,000 lb. of tea 

 have sold better than invoices of 6,000 lb. 



The same paper reproduces an elaborate article from 

 the Produce Markets Review, showing how the once 

 important and steadily conducted China Tea Trade has 

 fallen from its high estate, the old and well known 

 China firms, who traded on their own capital, having 

 retired from competition with persons more speculative 

 if not more reckless, who operated largely on borrowed 

 capital. Such a mode of doing business always, of 

 course, brings its own penalty in its train and the 

 China tea trade, as conducted in recent years has 

 proved no exception to the rule. Over-exporls, es 

 pecially of low quality teas, led to unremunerative 

 prices, the evil, as far as China teas were concerned 

 being aggravated by the increased import into Brit- 

 ain of the superior quality teas of India, Ceylon 

 and Java. The final result has been a consider- 

 able reduction in the supplies of tea from China, 

 the hiatus thus created and the gradual in- 

 crease of consumption being fully met by the produc- 

 tion of tea in India, Ceylon, Java and other sources 

 of supply never dreamt of in the palmy days when 

 China had a practical monopoly of the fragrant leaf. 

 It is true, that our most recent advices fn m India 

 report a deficiency of four millions of pounds in the 

 estimate for the year of sixty-six millions. But this 

 is a mere temporary decrease which will scarcely affect 

 the position of the trade. The effects of the Franco- 

 Chinese war, which is, apparently to be carried onto 

 the bitter end, may not be so great as some persons 

 think, but that a considerable effect it should have 

 in limiting supplies is inevitable. But we believe 

 that a far greater, and to China, more adverse effects 

 will be produced by the rapidly -growing taste for the 

 stronger and purer tea3 which India, Ceylon and other 

 places are, under European superintendence providing 

 to meet the wants of consumers. The sharp correction 

 administered to the reckless conduct of the China tea 

 trade, cannot but react favourably on India, Ceylon 

 and Java, and in discussing the probabilities of in- 

 creased consumption we ought not to leave out of 

 view the material effect likely to be produced by the 

 unprecedentedly low price of sugar. Tea, coffee, cacao 

 and all like beverages ought to profit by the, to 

 sugar planters, unfortunate stale of the sugar market. 



THE STATE OF THE TEA TRADE. 



The present condition of the China tea trade is thus 

 described in the Produce Markets Review. Those who 

 know the unsatisfactory position of the trade, and the 

 uncertainty and distrust prevailing will not consider that 

 the views there expressed are exaggerated or ill-founded. 

 The wonder is that, in face of the remarkable condition of 

 things now existing, the failures and embarassments have 

 not been more numerous. Apart from other circumstances 

 tending to affect adversely the profitable import andsale 

 of China teas, the rapid growth of the cultivation in India, 

 Java, and Ceylon must have given a serious blow to the 

 China trade, and narrowed the prospect of its revival 

 under more prosperous conditions. The outlook is 

 anything but a hopeful one, and we doubt if the "old China 



houses," to which our contemporary refers, will find th e 

 opportunity to take up the trade a very advantageous one : — 

 "Steam navigation on the Yangtse, the cutting of the 

 Suez Canal, and other quicker means of conveyance, 

 coupled with the extension of the telegraph to the East, 

 the opening of Japan, the vast increase of tea cultiv- 

 ation in India, Java, and recently in Ceylon, are all 

 causes which have for some years past been slowly but 

 completely revolutionizing the importing trade. The 

 changes that have taken place have ended in the more 

 or less sonrplete withdrawal, from a trade which they 

 no longer found profitable, of the firms of mer- 

 chants formerly jso well-known in connection with the 

 export of China teas. A class of merchants took 

 their place, who were dependent not only upon 

 their own capital, though that was often consider- 

 able, but on large credits and advances from 

 bankers and others in China and here. Without the 

 resources of the old firms, the extent of their business was 

 copied, and once a trade of the sort has been entered 

 upon, it has to be carried on, even when transactions show 

 a loss, until a point is reached when monetary facilities 

 are withdrawn, when a collapse ensues. Of course, such 

 operations in the ordinary course of business might, and 

 often do, lead to the attainment of great fortunes, and 

 even the wealthiest importing firms must require facil- 

 ities now and again. It is thus a question of degree, hut 

 the peculiarity of the China trade of late years is, that 

 it has been, to a greater extent thau is usual, carried on 

 with money belonging to others than the importers, and 

 at a time when, owing to the immense increase in the 

 production, and to the comparatively stationary state of 

 the demand a gradual hut ultimately heavy fall in prices 

 was a matter of certainty. The natural result of such 

 a remarkable condition of things has been that the 

 China tea trade has for years past been in a very 

 unsound position, and that the sudden rise of apparently 

 great businesses has too often been succeeded by their 

 equally rapid disappearance. This year the position has 

 been further complicated by the singular, and as yet 

 incompletely explained, decline in the value of all pro- 

 duce, which of course affected tea, and to such an 

 extent that a few months ago it seemed impossible that 

 the market could fall further. Nevertheless, it has 

 recently been followed by what was nothing less than a 

 panic, which can now be the better spoken of, as there 

 is no risk of adding to a pressure that has passed away. 



"Of late years the tea trade, from the extent of 

 advances upon bills of lading to importers and upon 

 warrants to merchants, dealers, and brokers, and in 

 many other ways, has partaken a good deal of the 

 pawnbroking character. A short time back some exceed- 

 ingly unsound, if not fraudulent, trading was brought 

 to light, and led to an immediate search through secur- 

 ities by bankers and others, and to a general and 

 sharp curtailment of credits and advances. This was 

 accompanied by a very rapid rise in the Bauk rate, which 

 tended to increase the pressure. As the tea market had 

 previously fallen heavily, the margin was found by those 

 who had advanced on tea in many cases to be insufficient, 

 and there was, of course, a further collapse in prices, and 

 a fresh fall, in some cases of 3d. and 4d. per lb., took place 

 within a few weeks. This fall, however, was of a most ir- 

 regular and indiscriminating character, for while common 

 sorts did not suffer much, the better kinds were in some 

 cases forced off at far lower prices. The panic in the tea 

 market did not, however, last very long, and prices have 

 since, as it were, been sorted out more in proportion to 

 intrinsic values. In some cases parcels bought during the 

 severest depression a few weeks back can hardly be matched 

 within 2d. or 3d. per lb. of the prices then given, and in some 

 few exceptional cases the difference is even double this. 

 Within a couple of months, therefore, Borne sorts of Congou 

 have fallen many pence per lb., and have since risen to almost 

 the same extent. Such violent fluctuations are unprecedented, 

 especially at a time when the general position of tea is 

 really strong. Prices, on the whole, except for a short 

 time just recently, have never been so low as they are now. 

 On tlie other hand, the exports from China have fallen off 

 heavily; the stock in London on November 30th, allowing 

 for arrivals not included in the return, was 10,000,0001b. 

 less than last year ; the home consumption, including coast- 

 wise deliveries, for the seven months, was 4,600,0001b, 



