COTTOX PEICES AXD MARKETS 
53 
in this period the weather makes the price, especially if stocks of 
raw cotton are low. 
The fall months present a very complex price-making situation, 
because of insufficiently accurate forecasts of supply and of the rate 
with which it will move to market. The figures of peculiar signifi- 
cance during this period are the prospective yield, the -ginnings, the 
movement of the crop into designated interior towns and into export, 
weather conditions as affecting both production and quality of the 
crop, and mill takings. Each period must be studied separately. 
Winter is used in the illustration (fig. 9) because it is the simplest. 
It will be noted that only two items of supply have been taken 
into account. The figures for supply, for example, could be refined 
CENTS 
PER 
POUND 
22 
20 
18- 
16 
14 
12 
LO 
Price Movement and Changes in Supply 
1914 —1924 
Price 
^v 
A — 
*k ^ Supply 
Mi 1 /v 
\ +«* 
V 
I\ 
X 
/ 
y 
/ 
> w 
\ \ 
A. 
f 
/ 
\^ 
- 
.. 
OF 
BALES 
22 
20 
! S 
I 5 
I 
1914 1915 1916 1917 1918 1919 1920 1921 1922 1923 1924 
Fig. 8. — Winter prices reflect changes in supply. During this period, except in 1919, an 
increase in the supply, indicated by the December estimate of production plus the re- 
ported carryover on August 1, was accompanied by a decrease in prices in December 
and January. The prices used in the preparation of this figure are in cents of equal 
purchasing power ; that is, the average price of spot cotton in New Orleans for Decem- 
ber and January has been divided by the Bureau of Labor Statistics index number for 
all commodities, to adjust for changes in the general level of prices 
by deducting consumption and exports from July to December and 
giving some weight to world production. 
Figure 8 indicates the relation of the price movement to changes 
in supply. 
Short-time fluctuations, the other price movement, is more or less 
irregular. The period covered by one of these movements, as well 
as its intensity, varies from time to time. This type of movement 
originates in or turns upon a wide range of causes or groups of 
causes, which may relate either to demand or to supply. The char- 
acter of any particular movement will be* determined somewhat by 
the technical position of the traders in the market. Each of the four 
groups in the market tends to adjust itself to every anticipated price 
movement. 
