ing the reopening of communication with re- of policy which neutralized the commercial conquered Southern localities: DEPARTMENT OF State, WashinGTON, May 2, 1862. SIR: I have the honor to state for your information, that the mails are allowed to pass to and from New Orleans and other places which, having heretofore been seized by insurgent forces, have since been recovered, and are now reoccupied by the land and naval forces of the United States. It is proper, however, to add that a military surveillance is maintained over such mails, as far as the Government find it necessary for the public safety. I am, sir, your obedient servant, WM. H. SEWARD. DEPARTMENT OF STATE, WASHINGTON, May 5, 1862. SIR: I have the honor to state for the information of your Government, that a Collector has been appointed by the President for New Orleans, and that the necessary preparations are being made to modify the blockade so far as to permit limited shipments to be made to and from that and one or more other ports, which are now closed by blockade, at times and upon conditions which will be made known by proclamation. I am, sir, your obedient servant, WM. H. SEWARD. A great number of vessels at once left the northern ports for that city with good outward bound cargoes. The President then issued a proclamation declaring that the blockade of the ports of Beaufort, Port Royal, and New Orleans shall so far cease and determine from and after the 1st of June, 1862, that commercial intercourse with these ports, except as to persons and things and information contraband of war, might from that time be carried on, subject to the laws of the United States, and to the limitations and in pursuance of the regulations which were prescribed by the Secretary of the Treasury, as follows: Regulations relating to trade with ports opened by results anticipated from the possession of the port. The Secretary of State wrote to the minister, Mr. Adams, at London, July 28, 1862, as follows: merce, and free them from military enibarrassments, We shall speedily open all the channels of com.forth as freely as heretofore. We have ascertained and cotton, so much desired by all nations, will flo that there are three and a half millions of bales vet remaining in the region where it was produced, though large quantities of it are yet unginned and otherwise unprepared for the market. We have instructed the military authorities to favor, so far as they can consistently with the public safety, its preparation for and despatch to the markets, where it is so much wanted; and now, notwithstanding the obstructions which have necessarily attended the reestablishment of the Federal authority in that region against watchful and desperate public enemies, in whose hands the suppression of the cotton trade by fire and force is a lever with which they expect to raise up allies throughout Europe, that trade has already begun to revive, and we are assured by our civil and military agents that it may be expected to increase fast enough to relieve the painful anxieties expressed to us by friendly nations. The President has given respectful consideration to the desire informally expressed to me by the Governments of Great Britain and France for some further relaxa tion of the blockade in favor of that trade. They are not rejected, but are yet held under consideration, with a view to ascertain more satisfactorily whether they are really necessary, and whether they can be adopted without such serious detriment to our military operations as would render them injurious rather than beneficial to the interests of all concerned. An answer will be seasonably given, which will leave foreign powers in no uncertainty about our course. business took place with the interior, and the It resulted, however, that no renewal of occupation of New Orleans, from which great hopes were entertained, not only as having direct influence upon the war, but on the means TREASURY DEPARTMENT, Monday, May 12. First. To vessels clearing from foreign ports and of freeing the 2,000,000 bales of cotton usually destined to ports opened by the proclamation of the delivered at that port, and which would not only President of the United States of this date, namely have kept alive the 772 northern mills, with Beaufort in North Carolina, Port Royal in South Caro- their 5 million spindles and 125,000 looms, emlina, and New Orleans in Louisiana. Licenses will be granted by consuls of the United ploying more than 100,000 hands, but would States, upon satisfactory evidence that the vessels so have largely supplied exchange, stopped the licensed will convey no person, property, or informa- outward flow of specie, diminished the distress tion contraband of war, either to or from said ports, in England and France, and smoothed the which licenses shall be exhibited to the collector of the foreign relations of the country, while it port to which said vessels may be respectively bound, immediately on arrival, and if required to any officer in Would have supplied immense resources to the charge of the blockade; and on leaving either of the Government, did not justify those hopes. The said ports every vessel will be required to have a clear- causes of the failure to realize these objects ance from the collector of the customs according to law, changed the whole face of business during showing that there has been no violation of the conditions of the license. Any violation of the said condi- the year, and while it made the occupation of tions will involve the forfeiture and condemnation of the mouths of the Mississippi barren of useful the vessel and cargo, and the exclusion of all parties results, added greatly to the exasperation of the concerned from any further privilege of entering South, and led to serious complications with the United States during the war for any purpose foreign consuls, whose rights and duties became by no means clear in the position in which they were placed. Their functions necessarily brought law, and whose rights of property depended them in contact with a people under martial upon the will of the military commander. whatever. Second. To vessels of the United States, clearing coastwise for the ports aforesaid, license can only be obtained from the Treasury Department. Third. In all other respects the existing blockade remains in full force and effect as hitherto established and maintained; nor is it relaxed by the proclamation except in regard to the ports to which the relaxation is by that instrument expressly applied. (Signed.) S. P. CHASE, Secretary of Treasury. The appointment of Gen. Butler to the command at New Orleans was followed by a line The trade of New Orleans, showing the receipts of the principal articles from the interior, during the year ending 31st of August, 1862, with their total value, is represented in the fol lowing table: Value. $18,420 581,400 219,631 19,262 88,847 201,440 87,030 164,365 the usual routine of commerce, by which the West, in sending produce South, makes ex168,889 change with which it pays the cost for goods 651,680 consumed at the West. There was nearly $12,40,860 000,000 less pork received thence, 3 millions less tobacco, and 11 millions less corn and wheat -making nearly 27 millions less value for those three articles, of which the West was deprived, and which necessarily diminished its means of purchasing goods; on the other hand, the West was deprived of its usual supplies of sugar and cotton. The receipts of sugar at New Orleans were very large, in consequence of the 899,608 plantations being within reach of the troops; and 142,312 there being no other outlet for the crops, the 52,650 value, even under the extraordinary proceed15,144 ings of the commanders at that point, reached 400 $31,796,053. The vessels which sought New 3,661,385 Orleans from the North on the opening of the 85,595 port found no outward cargoes that would pay. 164,275 211,830 1,769,040 44,432 89,410 1,275 1,915 426,069 2,360 894,485 77,220 82,886 15,736 The opening of the ports in North Carolina and South Carolina was not more successful. A small quantity of Sea Island cotton was seized 775,500 by the troops at Port Royal, and sent forward in gunny bags, unginned and dirty. Attempts made to plant and raise it were unsuccessful. Some efforts to open trade with North Carolina, by sending down assorted cargoes from the North, ended disastrously, and were not renewed. Naval stores, therefore, continued to command a very high price at the North. 6,703,079 400 692,690 74,000 122,043 3,610 200 985,992 1,108 149,324 1,060 100 67,416 88,024 585 8,850 25,092,974 10,000 27,720 200,600 24,000 The internal condition of the country during the year had much influence upon its external commerce, since a very large proportion of its industry was turned in a military direction, and the accustomed demand for goods and supplies for exports, was greatly interfered with. More than 700,000 men were called into the army and navy during the year, and the number who were engaged in the service of the Government in all departments, was represented at nearly 1,200,000. The accustomed sources of revenue for these persons were changed for Government pay, and this, to the extent of, in round numbers, 500 millions, flowed from the Treasury through the hands of individuals to the support of their families in all the States, 70,400 satisfying their necessary wants, but some218,466 what changing the character of the articles 5,000,000 consumed, while those usually produced be$51,510.990 came less abundant. The natural tendency under such circumstances is for prices to rise, and this tendency was accelerated by the paper paid out by the Government in such quantities as to cause it rapidly to depreciate. The first effect of this state of affairs was to induce larger imports, and to diminish exports, causing an outward flow of the precious metals which gave a new impetus to the decline of the currency. Other circumstances combined to push on these effects. 127,320 1,620 231,300 155,863,564 185,211,254 The aggregate shows a decline of more than 100 millions upon the year's business, consisting mostly of cotton, which did not arrive at that port from the interior during its military occupation, since the military commander failed to inspire confidence among the planters in respect to the safety of property. On page 113, "Annual Cyclopædia of 1861," will be found the returns for the years 1860 and 1861-a comparison indicating the vast decline in the receipts of western products, mostly coal and provisions. The blockade of the river cut off For the first time the trade of the entire year 1862 was confined to the Northern ports, and Baltimore, Philadelphia, Boston, and New York, were the points of exports as well as of imports for the whole country. The exports from New York represented by far the largest por- 1862. According to the annual statement of the superintendent, in the year 1862 there passed through the ship canal, at St. Mary's Falls, Michigan, which forms the gateway to Lake Superior, $12,000,000 worth of copper and iron, besides general merchandise to the value of $10,000,000. The following statement, prepared by the superintendent of the canal, shows the extent and character of this trade more in detail: 543 schooners, aggregating 170,595 tons; 121 propellers, 65,124 tons; and 174 steamers, 124,838 tons--making a total tonnage for the year of 359,612 tons. By this it appears that the whole number of vessels, sail and steam, that passed through the canal last year was 838, with an aggregate tonnage of 359,612 tons. In the year previous there were $9,508 527 vessels, sail and steam, with a tonnage of 276,637 tons. At six cents per ton, the rate now collected, the tolls for the last year amounted to $21,676.72, of which $14,120 were deposited with the State Treasurer. careful estimate of the trade of the Lake Superior region for the year 1862 gives the following results: Iron, pig and ore, 150,000 tons; copper, 9,300 tons; general merchandise, 80,000 tons. 41,894 The iron and copper mines of Lake Superior were never in a more prosperous condition, and there is every reason to believe there will be a large increase of exports in the current year, though the business of 1862 shows an increase of about 50 per cent., compared with 18,200 the year immediately preceding. 1,580 1,580 2,961,518 8.397 132,606 210,669 118,819 96,701 80,884 5.892 46.674 3,507 8,110,646 Rye flour.. Corn meal.. 11,807 108,385 Wheat, bushels. 28,889,914 Rye.... 1,000,405 Oats... 160,$25 8.927 189,284 33,409 Naval stores: Crude turp., bbls. 21,571 Spirits turpentine... 18,825 Rosin.... 208,061 17 788 4,601 906 756,178 710,885 A In the early part of the year the trade un1,554,359 derwent a great depression, and the prices fell to a very low point, with a great accumulation 35,640 of stock on hand; a remarkable upward movement then took place, and a very rapid advance 82.977 in prices suddenly developed a great traffic. 27.765 This, like most others, was powerfully affected 145,102,758 by the effect of paper money upon the exchanges 89.200,439 of the country, since as the price of bills rose it 47,290.409 126,651,091 imparted a stimulus to the shipment of all avail12,143 able goods, and consequently the export value 48,866,920 of the produce by no means represents the 113,575 value realized abroad, since the value is in 1,191,907 paper prices. The export value of the month of December was $14,805,112 for domestic 23,159,891 30,603,235 15,867 15,527 25,820,335 116,598 8,152,484 975,075 701 1,598,044 • Included in the exports of crude tobacco are 45,850 hogsheads. The banks of New York suspended at the close of 1861; but inasmuch as the institutions, in consequence, sought rather to contract than to expand their operations, no material depreciation took place until the issues of Government paper began to make their appearance in April, and became the basis of the bank paper. In the first three months the exports of produce were small. As soon, however, as the depreciation of paper began to show itself by a rise in gold, and a consequent higher price for exchange, an impetus was imparted to the export of produce, for the reason that if the market did not promise a profit abroad, the shipper by selling his bill at a higher rate for paper money realized a profit. Thus in April the price of sterling was 11 per cent., in June it had risen to 21, or 10 per cent. advance. Accordingly the exports of domestic produce in April were 8,000,000, but exceeded 10,000, 000 in June; notwithstanding prices abroad were more unfavorable for shipments, with every successive rise in the bills as measured in paper money, there was more activity in shipments. Inasmuch, however, as prices became more unfavorable abroad, these shipments did not always prove profitable, notwithstanding the high price obtained for the bill, the value of which came to be regulated by that of specie. The current of the metals continued to set out in a broader stream, although they apparently bore a premium. The mode of quotation is deceptive, and the fact that specie continues to leave the country in a large volume indicates that it is still the best remittance out of the country for the banker who sells bills, even if he ships American gold. Many individuals who had remittances to make out of the country invested in produce of different descriptions; but the results were not always so favorable as if gold had been depended upon exclusively. The rise in prices of produce at the seaboard did not much improve the condition of the producer at the West, since the cost of transportation was proportionately advanced, and the cost of goods 181,285,995 142,931,151 taken in return was swollen not only by higher charges for carriage, but also by taxes and depreciation of the currency. The gradual decline in the supplies of cotton as a material for manufacture diminished the activity of an industry that usually employs a capital of 100 millions, but also that of all persons engaged in the buying and selling, and transportation of the material and goods. When the blockade took place, cutting off the supply of cotton, there was a stock in the hands of dealers and manufacturers possibly equal to six months' consumption, and the stock of goods in stores was fair. Those stocks have dwindled away under the demand for consumption, at gradually rising prices; and the stock of cotton has continued to shrink, although held by speculators generally in advance of the market for goods. Month by month, and day by day, the shelves have been thinned out, and the number of bales that form the last resort of the spinners for materials has become less. One can imagine the careful manufacturer, like a shipwrecked mariner, anxiously inspecting his pile of biscuit saved from disaster, and ruefully counting what remains after each day's inevitable consumption, and fixing the date beyond which the utmost economy will not stretch the scanty supply-the moment when the last bale will have been opened for the picker, amid preparations for the final closing of the mill. With this prospect in view, the mills have diminished their work; and the weakest, one after the other, have stopped, as the stronger have bid up for the shrinking stock of cotton 10 to 20, 30, 40, 50, 60, 70, and, finally, 90 cents, without increasing the supply, until the figures have come to represent a famine rather than a trade. These circumstances have caused strong houses to hold the goods for the use of regular customers. The remains of the once great cotton manufacture were eagerly bought up, without much regard to price; and staple goods have come to be regarded as of more value even than gold, amidst a depreciated currency. The great apparent rise in value has doubt less conferred great gains upon holders as well as upon mills, the stocks of which have risen 50 to 100 per cent., as expressed in paper money, a medium certainly a little unstable, more particularly when it is borne in mind that whatever may have been the dividends of the past year, the future value depends upon food for the spindles. The machinery may be changed, and adapted to other materials; but whence are those other materials to be derived? The wool crop of the United States is always short, and foreign supplies can be had only in com petition with foreign buyers at great disadvantage. The holders of goods found great advantage in the rise, but to replace most goods became, as the year advanced, a matter of more difficulty, inasmuch as while the domestic goods diminished in supply in face of the declining supply of material, the cost of importation rose in a similar ratio under the influence of higher duties, and depreciation of the currency. The imports into the port of New York were monthly as follows: The importations varied from month to month, and reached the highest point in the month of July, after which the expenses of importation increased so as to weigh heavily upon the cost of goods, and make the business more hazardous. On some articles the duties were increased. The most necessary articles, or those for which the country depends for a supply mainly upon imports, were the first to advance to such prices as would permit the importation in face of the taxes. The imports of cotton goods were much larger than for the previous year, but far less than for the corresponding period of 1860. There were about 95,000,000 yards imported against 195,000,000 in 1860. The high price of cotton in England drew large supplies from India, and this laid the groundwork of a derangement of the finances, since the larger the amount of cotton imported from a country which demands silver mostly in payment, caused a disturbing drain upon England and western Europe. The effect of this influence may be seen in the value of cotton imported into England in the first ten months of three years, as follows: Value of Cotton Imported into Great Britain. 30,358,918 than in 1861; as a consequence, the exports of silver to that country increased $15,000,000, and of gold $4,000,000. A larger portion of the silver was procured from France, whence England imported $10,500,000, and in return sent thither $30,000,000 worth of gold. A considerable portion of this gold was required to meet American bills running on England for French goods. In ordinary years the exports of produce from the United States to Great Brit tain are such as to pay for United States purchases of English goods, and leave due to the United States a large balance, which is drawn against in favor of the Continent and elsewhere for balances due those countries over and above the sum of their purchases of American produce. In the past year the whole circle of trade has been interrupted. The United States have not been able to send their usual quantities of produce to France, and although less French goods have been bought, the amount has sufficed to aid the drain of coin from England to France, while the want of American cotton in England has compelled her to buy more of Indian at cash prices. This tendency has been counteracted to some extent by the increased sales of English produce to France under the new treaty. The exports from England to France and the United States for eleven months of 1862 were as follows: COUNTRIES. Total....... $154,811,925 $91,420,600 Although the aggregate imports of cotton were less, the increased purchases from India were $30,000,000 more in 10 months of 1862 France. As compared with 1860, France bought of England $16,500,000 more, and the United States $33,000,000 less. The tendency of a drain of the metals is such, however, as to in |
