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“...of British importers, but the Lancashire manufacturer—
seeing how completely he was cut out in heavy grey goods in the
north of China—cannot fail to regard this state of things with
apprehension. Competition was formerly restricted to 14-lb.
cloths, but the American manufacturer is now cutting into
Lancashire as low as 10 lbs., and must continue to do so, so long
as he enjoys present advantages in the matter of geographical
location, improved machinery and transport rates,
The transfer of the mills in the North-Eastern States to the
South, in the centre of the cotton country, and the more
advantageous rates of freight, obtainable from New Orleans and
New York, must tell very greatly in favour of the American as
compared with the British manufacturer, who has to procure his
raw material from across the seas, take it inland at heavy cost,
and when made up take it back to the coast for shipment abroad.
The trade in otiier than grey goods must, for some time to come,
until the Americans acquire...”
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“...■16
CHINA.
therefore of how the Chinese mills will eventually affect the output
of the Indian mills is one of great interest, seeing that 95 per
cent, of the Indian export of yarn is at present absorbed by China.
In Annex A to this section will be found some valuable notes
bearing on this subject.
There are about 14 mills in China, say some 460,000 spindles,
spinning 10's, 12's, 14's and 16*'s, and their total out-turn may be
set down at 60,000,000 lbs., about half of which is consumed in
the Shanghai district, the balance going to ports up the Yangtzu
and to North China. This yarn pays, on export from Shanghai
to another treaty port, a duty of 0'70 Haikuan tael per picul, the
equivalent of the former full import duty on imported yarn.
Seeing that Chinese raw cotton is subject to the full incidence
of internal taxation, and cotton, imported from abroad, pays import
duty, this tax is not a popular one as far as the millowners are
concerned.
The only charge on cotton spun in Japan is...”
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“...very large quantities Flour,
of Hour imported. North China consumes principally wheat and
millet, but the staple food of the people south of the Yellow River
is rice. The emigrant, unable to procure rice abroad, has to adapt
■himself to his surroundings, and on his return shows no inclination
to revert to his former diet. At the port of Swatow alone the
importation of flour has increased from 777,866 lbs. in 1892 to
14,913,733 lbs. in 1901.
Central China produces wheat of average quality, and mills for
■grinding flour have recently been started. When two new ones,
at present in course of erection, are working, the total out-turn
will be 260,000 lbs. per diem. The colour of the flour is, however,
inferior to that of imported flour.
The quantity of rice imported depends entirely on the home Rice-
harvest, and for the last five years has averaged 167,000,000 lbs.
The bulk of it goes to feed the teeming population of the Canton
Jiiver delta, and is supplementary to an average annual import...”
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“...favour; the figures
that I have of certain Indian mills show their cost of coal per
spindle to be 0-84 taels per annum, against the Shanghai cost of
O'Gl taels, a difference in China's favour of say 27j per-cent.
As the coal bill in spinning forms some 20 per cent, of the total
charges, the advantage to China under this heading is some 5 to>
6 per cent.
Generally speaking, the climate of' Shanghai is better suited
to spinning than is the Indian climate. In many parts of India
it is necessary to use humidifiers in the mills to keep the air
moist; in Shanghai humidifiers are, so far as I am aware, un-
known, the natural moisture in the atmosphere being fully
sulficient.
(2) Disad- The chief disadvantage suffered by China as compared with India
cost difficult to say what is tlie extent of
Ciih n. this disadvantage, as the price of labour in India varies according
to locality ; the figures of the Indian mills in my possession
relate only to mills in Southern India, where labour is cheaper
than...”
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“...china.
however, that, with more experienced working, the number of
hands employed in the Shanghai mills is being gradually reduced,
and it seems reasonable to expect that only time is required to
bring our labour cost down to that of Bombay.
Another serious disadvantage l'rom which China suffers lies in
the conditions of the local cotton market, which is practically in
the hands of an unscrupulous set of cotton growers and dealers,
who are able to manipulate it almost at will, and who seem bent
on killing the industry which is the main support of their trade.
The only way in which the demands of the cotton hongs can be
kept in any degree of check is by importing Indian cotton against
them, and this the mills are compelled to do to a very large
extent, thus diverting the work of the mills from the purposes
for which they were started to the extent of such importation,
and, moreover, lowering the quality of the yarns produced. And
beyond this question of market is the great trouble caused...”
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“...themselves. The Government or the trade guilds must
realise that a continuance of this practice will inevitably kill
■what trade there is in certain staples of export, and it is incum-
bent on them to devise laws or regulations to meet the situation.
That this is by no means impossible is proved by the fact that,
■when called upon to do so, the local authorities in Shanghai were
.able to cope successfully with the serious malpractices in connec-
tion with the supply of raw cotton to the local mills.
»! - A cure for the second evil would be the exercise of common
.sense on the part of the foreign merchant. America, Australia,
and more especially India, compete with China in the matter of
exports, but in comparison with these countries the export trade
of the Middle Kingdom has been not inaptly described as a.:< sample
.business." The Chinese middleman is, as a rule, crassly ignorant
of the conditions governing the world's markets, but when he sees
a'number of Europeans fiercely struggling...”
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“...import of Ceylon tea dust, for purposes of mixing with Chinese
dust and fannings made into tablet and brick tea, destined
for the Russian market. The import last year amounted to
2,179,744 lbs. Some 273,280 lbs. of Ceylon leaf were also imported,
but the experiment of blending it with China leaf has not proved
very successful.
Turning now to the minor staples of export, one finds at the Raw cotton.,
head of the list raw cotton. Tliis article goes almost exclusively
to Japan to feed the cotton mills there, Japan producing but little
cotton of her own.
Bean cake, beans and bean oil, the products of Manchuria, are Bean
other articles, the foreign export of which is, so far, practically con- P1'odlK't5-
fined to Japan. There is and has been a large export of bean cake
from Newchuang to supply the needs of the sugar plantations in
Southern China, but the growth of the demand from Japan may
be said to have commenced at the close of the Chino-Japanese
war, and was the outcome of observations made...”
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“...CHINA.
55-
Aii extended field of distribution for machinery appears to be
opening up.
Flour and rice mills are, at the large centres, superseding native
methods for treating rice and wheat. There seems an inclination
to adopt foreign presses for dealing with bean products and
extracting vegetable oils. Numerous enquiries are being made
after engines to assist in various kinds of local manufacture on a
small scale, and there are many other indications of a recognition
of the superiority of machinery over manual processes. It may
be as well, however, to state beforehand that it will prove of little
use to address to His Majesty's representatives in China English
circulars and illustrated price lists, setting forth the merits of
machinery of this kind. Ocular demonstration of what a machine
can do is what pleases the native best, and tends to lead to
immediate business. A leading firm in Shanghai some months
ago established a show room in which types of machinery are set
up, with a small...”
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