A WARNING FROM THE GRAIN TRADE.

Globe, Volume VI, Issue 693, 8 September 1876, Page 3

A WARNING FROM THE GRAIN TRADE.

[From the Pall Mall The influence exerted on the prosperity of old countries by the material growth of new communities is a branch of historical inquiry which has received less attention than its interest deserves. The minds of historians have been too much engrossed by the stirring drama of war and diplomacy, of politics and Court intrigue, to give themselves to the dry and obscure study of the movements of commerce ; yet it is obvious that the substantial power of a nation consists of the resources in men and money of which it is able to dispose. If, therefore, the business which fed the wealth of one State and gave employment to a large proportion of its people is transferred without equivalent to another, it is evident that the first must descend in the scale of nations and that the second must rise. In a general way it has always been recognised that the decadence of the Italian Republics dates from the outburst of maritime enterprise in Spain and Portugal in the fifteenth century. The discovery of the route round the Cape of Good Hope deprived these Republics of their advantages in the trade with the East, and the discovery and colonisation of America finished the stroke by dwarfing the value of the Asiatic trade itself. The rise of the Dutch Republic in turn contributed to depress Spain, and the maritime pre-eminence of England has reduced the Netherlands to comparative insignificance. These examples, however, are so patent to the most superficial observer that they could hardly have escaped notice. But there are instances of one country's growth being affected by that of another which are detected only by careful inquiry. At first sight it would seem that the growth of the United States must prove injurious to England, and that it could have no effect upon Russia. The circumstances uuder which the separation between England and the thirteen colonies occurred, the repeated disputes which have since sprung up, the possession by England of an immense territory to the north of the Union and in the West Indies, and the emigration of such large numbers of disaffected Irish, all contributed to engender a feeling between the two countries which was far from cordial. Then, again, the United States is the second maritime Power in the world. A quarter of a century ago, indeed, her competition in the carrying trade of the world pushed us hard—that is to say, in the very trade the loss of which had successively brought down the Italian Republics and Holland. Lastly, the United States is our rival in the cotton ma-iufacture, in the iron industry, and indeed in manufactures generally. On the other hand, Russia and the United States are so distant one from the other, their political institutions and their national aspirations are so dissimilar, and their relations with one another, whether political or commercial, are so slight that it seems impossible one could powerfully affect the other. Accordingly, we find a very general impression prevailing in the three countries that the progress of the United States is disadvan. tageous to England, and for that reason advantageous to Russia. In the correspondence of the younger Adams, lately published, there is an entry in his journal of a very instructive conversation with the Russian Chancellor while Adams was American Pilinister at the Court of St Petersburg. The alliance between Napoleon I. and the Czar Alexander was still subsisting, and Russia was at the head of the armed neutrality which, we need hardly remind the reader, wai directed against England. The Chancellor declared that it was the interest of Russia to promote the growth of the Unifed States in every way. However great the Union might become, she could not injure liussia, for the countries had not an antagonistic interest, nor, it would seem to be implied, a common interest except hostility to England. But, in the opinion of the Chancellor the interests of England and the United States were unavoidably antagonistic. The friendship that subsisted between Russia and the United States, down at least to a few years ago, prove 9 the permanence of these ideas at the Court of St Petersburg. Yet it is demonstrable that the growth of the United States has been beneficial to England and disadvantageous to Russia. The manufacturing prosperity of Lancashire and the vast trade of the port of Liverpool are important factors in the wealth and greatness of England. But these grow with the development of the cotton cultivation in the United States, and the experience of the civil war proved to uh how largely they still depend upon the prosperity of that cultivation. Again, it is a condition of our industrial 1 pre-eminence that we should be able, in bad years as well aB in good, to obtain a steady, abundant, not over dear supply of wheat, and this supply the opening up of the great West insures us. How the progress of the United States has affected Russia is partly told in a report of the Chamber of Commerce of Odessa which was published last winter. Three successive bad harvests have plunged Southern Russia into distress, and caused an ; alarming falling off in the export of grain. But even before the occurrence of the bad seasons, the report shows the decline in the exports. to this country had become most marked. So short a time ago, as 1867 fully 44 per cent of the foreign corn imported into England came from Russia, while only 14 per cent came from the United States \ but in 1873—-the year ending that is with the first of the bad harvests—the American exports had taken the place of the Russian, which had fallen to 21 percent. Jn other words, the American exports of corn to England had trebled in the brief space of 3ix years, while those of Russia had fallen to one-half. Ruesia had tried to make up for her loss of ground in the English market by increasing her exports to Germany; but

in the six years the addition to her tohnl grain exports was only 11 per cent. In the same period the total American exports hid doubled. The growth of the American grain trade had become nine times more rapid than that of the Russian. Lastly, the total value of the American exports was £29,000,000; of the Russian only £24,000,000. Superior intelligence, skill, enterprise, capital, and facilities of conveyance had in six years enabled the Americans practically to drive the Russian* out of the English market, and the bad harvests since have given them a further advantage. The Americans have as great facilities for exporting to Hamburg and Bremen as to Liverpool and London. The probability is, therefore, that they will repeat in Germany what they have done in England. In that case Russia would be deprived of a trade which stands for half the value of all her exports. The Mississippi Valley is capable of producing food enough for all Europe. The only obstacle in the way of the Americans is their great distance from the market and the consequent cost of carriage. To overcome this they have been improving their canals, utilising the St Lawrence, extending railway communication, and the Grangers have been making war upon the railway companies. Of late they have turned their attention to the deepening of the mouths of the Mississippi. The great corn-growing States are so distant from New York that by land the cost of carriage must always be excessive. The freezing of the St Lawrence during the winter makes that route unavailable for half the year, and the bar at the mouth of the Mississippi has hitherto prevented the exportation of corn that way. But Captain Eads is now removing that bar, it is said, with every prospect of success. If he succeeds, the desire of the Graingers is gratified, and there is no limit to the quantity of corn which can be exported to Europe. At present it is most profitable to send only cotton from New Orleans, because of the shallowness of the water. But the New York Financial Chronicle tells us that, if the river mouth is deepened, it will pay best not to load with more cotton but to add some feet of grain. Furthermore, the same paper assures us that a plan is ready for bringing down grain from the upper valley at a trifling expense. Indeed, the experience of the Suez Canal warrants us in saying that, if Captain Eads succeeds, vessels specially adapted to the river will be built to convey corn to Europe. The exportation will then be limited only by the demand ; and as the coat of carriage, which now represents five-sixths of the price, will be immensely reduced, American corn will be sold in England and Germany at a figure for which Russian corn cannot be grown. If, then, Captain Eads' jetties prove what he expects them to be, there is a great probability that the grain trade of Southern Russia will be annihilated. If we realise to ourselves what that signifies, we shall easily understand the alarm of the Odessa Chamber of Commerce. It means, not alone that half the export trade of Ruseia will be swept away at a stroke, but also that vast tracts will be thrown out of cultivation which now grow crops that are sold abroad for some £24,':00,000 sterling per annum. It means, further, railways deprived of the best part of their goods traffic, banks insolvent that advance to the farmers, export merchants at Odessa and other ports ruined or driven away, and the loss of the expenditure attendant upon the presence of the ships of all nations, which in the autumn and winter now crowd the harbors of the Black Sea. The loss of revenue that in all these various ways would fall upon the Russian Government would be enormous ; and in addition it would probably have to make good its railway guarantees, and would find its credit less good in the loan markets of Europe.