PRIMARY MARKET PRICES ANO QUALITIES OF COTTON. H 



for it and his profits should be proportionately larger, still the range 

 in prices indicates that little regard was shown to price differences 

 as they existed in the spot markets, and that many farmers disposed 

 of their product at prices far below its value. Tinged and stained 

 cotton usually has been sold on type rather than on description, which 

 fact has worked to the disadvantage of the producer who had this 

 kind of lint, for it meant that the buyer had to purchase this cotton, 

 send a sample to his brokers, and then receive an offer based on the 

 type submitted. It is apparent that in naming a price to the pro- 

 ducer, the buyer would make it so low that little if any risk would 

 be involved. 



In Longview, Tex., on November 22, two bales of the same grade 

 of cotton were sold — one bale of 1-inch staple bringing 9^ cents, and 

 the other bale of l^g-inch staple, bringing 4^ cents, a difference of 

 5 cents per pound, or $25 per bale. It is probable that the producer 

 owning the first bale knew something of values, and that the one sell- 

 ing for the lower figure knew nothing of grade, or staple. In Boswell, 

 Okla., on November 11, two bales sold at a difference of 431 points, 

 or $21.55 per bale. While these are the extreme variations between 

 bales of the same grade in the same market, many instances of varia- 

 tions of over $10 per bale are shown. As between different markets in 

 the belt even wider ranges could be shown. While the two cases cited 

 occurred in the West, where the widest ranges were usually found, 

 still a condition almost as bad was revealed in the East. In Chapin, 

 S. C, two bales of the same grade sold on the same day with a differ- 

 ence of $13.50 per bale; El Dorado, Ark., $13.75; and Albertville, 

 Ala., $10. As this survey shows that fully one-fourth of this crop 

 was off-colored, some idea can be formed as to the losses which the 

 producers probably sustained. 



The fact that official standards for tinged and stained cotton have 

 been promulgated 1 should enable the merchant to handle colored cotton 

 in the future with little more risk than with white cotton. The decreased 

 risk naturally will give greater stability to the market and should 

 enable the farmer to secure prices which are more in line with the 

 value of the product offered. Table 4 shows the wide range in prices 

 paid in primary' markets for tinged and stained cotton. It is but 

 natural to expect a considerable range in prices, but there is no argu- 

 ment to justify a variation of 500 points in the same market on the 

 same day for the same grade, especially when this difference amounts 

 to more than was paid the producer for the lowest-priced bale. 



It must not be supposed that the local buyer reaps the entire benefit 

 of this loss, because he, too, is frequently not aware of the intrinsic 

 worth of the cotton that he purchases. Probably this amount is 

 absorbed gradually along the line, but the producer is the one who 

 sustains the loss. 



* Promulgated Jan. 28, 1916. See U. S. Dept. of Agricnfttrre, Office of Markets and Rnral Organization, 

 Service and Regulatory Announcement No. 9, 1916. 



