BUREAU OF MARKETS. 483 



INVESTIGATIONS OF FUTURE AND SPOT MARKETS. 



These investigations are directed by Mr. George R. Argo, who 

 also is in cnarge ot tlie project "Determination of Disputes." It 

 has been very difficult to obtain coirect commeicial differences for 

 cotton during the past season, owing to the abnormal demand for high- 

 grade cotton and the practical unsalability of low-grade cotton. To 

 add to the difficult} , the low grades have been concentrated in a 

 limited numler of markets wnich endeavoied to quote them correctly, 

 while other markets, holding no low-grade cotton, were at a loss 

 as to how to arrive at correct diffoiences. The reoiilt was thai 

 some markets quoted the very low grades at a much wider discount 

 than others. Apparently the result was that the a\ erage differences 

 for low grades were comparatively so narrow as to make delivery of 

 low-grade cotton on future contracts quite profitable The parity 

 between spots and futures was fairly well maintained up to about 

 April 10, at which time a decline in futures began and continued for 

 several weeks. It would appear that the lack of demand and un- 

 salability of low-grade cotton became apparent to the general trade 

 at this time and the contract naarket was the only outlet. In conse- 

 quence, over 20,000 bales were delivered during the month of May, 

 and its sale was evidently found to be profitable even at the great 

 disparity between spots ana futures. This cotton was probably 

 hedged before the decline started Differences were widened appre- 

 ciably during May and June and the disparity between spots and 

 futures is still abnormally great. 



The bureau has enjoyed the cordial cooperation of the designated 

 spot markets throughout the year. Boston was taken from the list 

 of spot markets on June 8, 1918, because, owing to the lack of variety 

 in the grades received there, it was impossible to secure enough quo- 

 tations to arrive at correct differences. 



DETERMINATION OF DISPUTES. 



The number of disputes and bales of cotton involved therein 

 received during the last fiscal year varied from the preceding year 

 only sHghtly. In 1918, 146 disputes, involving 6,895 bales of cot- 

 ton were recived, in comparison with 155 disputes, involving 5,903 

 bales, in 1917. 



One dispute, involving 16 bales, was withdrawn and the deposit 

 was returned to the complainant. The total sum collected as costs 

 for determination of the disputes was $2,202.30 in 1918, as against 

 $1,664.35 last year. All of this fund was covered into the Treasury 

 of the United States, in accordance with the provisions of the cotton 

 futures act. 



A great deal of low-grade cotton was delivered on contract during 

 the months of May and early June and caused many appeals to be 

 made to this department. Out of 52 disputes, referred in this time, 

 involving 3,156 bales of cotton, 2,404 bales, or 76 per cent, were 

 rejected as undeliverable on contract. 



PREPARATION AND DISTRIBUTION OP OFFICIAL COTTON STANDARDS OF THE UNITED 



STATES. 



Since the establishment and promulgation on December 15, 1914, 

 of the official cotton standards of the United States for white cot- 

 ton, and on January 28, 1915, of standards for colored cotton, a total 



