What was the break even price for cotton between 1800 and 1860?

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Hunter

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Apr 23, 2016
Great thread, but I think we've got at least three, separate conversations going on here. :smile:

There is no average cost of production and shipping because everyone's circumstances were different. Even if we could find an "average," it would be meaningless for this reason.

Plus, there were different categories of cotton when brought to market - as many as six to eight, from OK to really good. Price per pound could be double for the really high quality stuff vs. the just stuff.

I am referring to short staple cotton, which was the most sought after in the U.S. and British markets. The market price tanked for virtually all of the 1820s and into the early 1830s. It rose somewhat but tanked again near the end of that decade and stayed low until the early 1850s. The price never got higher than the prices in 1815-1818 before the war.
 
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jgoodguy

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It shows that the efficiency of cotton production, in terms of value produced per slave, more than doubled. This more than offset the reduced price of cotton, and drove the increase in the price of slaves.
Good points, but I see a disaster in the making as the production and productivity increased, the price dropped hard it looks like. The decline in price of cotton seems to be a multiplier of the decline in export price. It looks to me like a economic bubble ready to burst. Hard to tell from a few data points, but had it burst prior to secession, the slave holders would have been distracted from secession and worried about mere economic survival.
 
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Eric Calistri

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Good points, but I see a disaster in the making as the production and productivity increased, the price dropped hard it looks like. The decline in price of cotton seems to be a multiplier of the decline in export price. It looks to me like a economic bubble ready to burst. Hard to tell from a few data points, but had it burst prior to secession, the slave holders would have been distracted from secession and worried about mere economic survival.
#22 shows the rapid increase in cotton production in the US, with Texas really just getting started (400,000 bales in 1859, but 1.5 million bales in 1889 and 3.5 million bales in 1900). I don't have the international production data, but that too was on a huge upswing, so no doubt a bubble from over production was somewhere in the future for cotton producers.
The bust end of the commodity cycle would, I believe, be particularly devastating for cotton growers given their dependency on slave labor.

But through 1860, it seems the price of cotton held up remarkably well given the tremendous increase of supply.
 

jgoodguy

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#22 shows the rapid increase in cotton production in the US, with Texas really just getting started (400,000 bales in 1859, but 1.5 million bales in 1889 and 3.5 million bales in 1900). I don't have the international production data, but that too was on a huge upswing, so no doubt a bubble from over production was somewhere in the future for cotton producers.
The bust end of the commodity cycle would, I believe, be particularly devastating for cotton growers given their dependency on slave labor.

But through 1860, it seems the price of cotton held up remarkably well given the tremendous increase of supply.
I agree. IMHO 1860 was the year the demand in cotton stopped growing rapidly and was limited to population increase instead of opening new markets. From the reconstruction through the industrialization of the South in the mid 20th centurie, cotton boom and bust was a common occurrence.
 

Hunter

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#22 shows the rapid increase in cotton production in the US, with Texas really just getting started (400,000 bales in 1859, but 1.5 million bales in 1889 and 3.5 million bales in 1900). I don't have the international production data, but that too was on a huge upswing, so no doubt a bubble from over production was somewhere in the future for cotton producers.
The bust end of the commodity cycle would, I believe, be particularly devastating for cotton growers given their dependency on slave labor.

But through 1860, it seems the price of cotton held up remarkably well given the tremendous increase of supply.
Actually the busts during this period on cotton prices were far lengthier than the booms. In fact, the only real boom was before 1819. Not sure you would get any planter to agree with your assessment of price stability. There were several movements to keep prices high enough to make a profit, such as the creation of cartels, but not enough discipline. As a result, many went bankrupt or moved further west to avoid creditors.
 
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Eric Calistri

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Actually the busts during this period on cotton prices were far lengthier than the booms. In fact, the only real boom was before 1819. Not sure you would get any planter to agree with your assessment of price stability. There were several movements to keep prices high enough to make a profit, such as the creation of cartels, but not enough discipline. As a result, many went bankrupt or moved further west to avoid creditors.
Sources?
 

jgoodguy

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What I found. No expressed or implied warranty.
http://answers.google.com/answers/threadview?id=33770
The price is not adjusted for inflation.

: Price
Year :- per : Lbs Cents
1876 : 9.71
1877 : 8.53
1878 : 8.16
1879 : 10.28
1880 : 9.83
1881 : 10.66
1882 : 9.12
1883 : 9.13
1884 : 9.19
1885 : 8.39
1886 : 8.06
1887 : 8.55
1888 : 8.50
1889 : 8.55
1890 : 8.59
1891 : 7.24
1892 : 8.34
1893 : 7.00
1894 : 4.59
1895 : 7.62
1896 : 6.66
1897 : 6.68
1898 : 5.73
1899 : 6.98
1900 : 9.2
1901 : 7.0
1902 : 7.6
1903 : 10.49
1904 : 9.0
1905 : 10.78
1906 : 9.6
1907 : 10.36
1908 : 9.0
1909 : 13.52
1910 : 13.96
1911 : 9.65
1912 : 11.50
1913 : 12.47
1914 : 7.35
1915 : 11.22
1916 : 17.36
1917 : 27.09
1918 : 28.88
1919 : 35.34
1920 : 15.89
1921 : 17.00
1922 : 22.88
1923 : 28.69
1924 : 22.91
1925 : 19.62
1926 : 12.49
1927 : 20.20
1928 : 17.98
1929 : 16.78
1930 : 9.46
1931 : 5.66
1932 : 6.52
1933 : 10.17
1934 : 12.36
1935 : 11.09
1936 : 12.36
1937 : 8.41
1938 : 8.60
1939 : 9.09
1940 : 9.89
1941 : 17.03
1942 : 19.05
1943 : 19.90
1944 : 20.73
1945 : 22.52
1946 : 32.64
1947 : 31.93
1948 : 30.38
1949 : 28.58
1950 : 40.07
1951 : 37.88
1952 : 34.59
1953 : 32.25
1954 : 33.61
1955 : 32.33
1956 : 31.75
1957 : 29.65
1958 : 33.23
1959 : 31.66
1960 : 30.19
1961 : 32.92
1962 : 31.90
1963 : 32.23
1964 : 31.07
1965 : 29.37
1966 : 21.75
1967 : 26.70
1968 : 23.11
1969 : 22.00
1970 : 21.98
1971 : 28.23
1972 : 27.30
1973 : 44.60
1974 : 42.90
1975 : 51.30
1976 : 64.10
1977 : 52.30
1978 : 58.40
1979 : 62.50
1980 : 74.70
1981 : 54.30
1982 : 59.60
1983 : 66.60
1984 : 58.90
1985 : 56.30
1986 : 52.40
1987 : 64.30
1988 : 56.60
1989 : 66.20
1990 : 68.20
1991 : 58.10
1992 : 54.90
1993 : 58.40
1994 : 72.00
1995 : 76.50
1996 : 70.50
1997 : 66.20
1998 : 61.70
1999 : 46.80
2000 : 51.60
2001 : 35.10

Cornell University
http://usda.mannlib.cornell.edu/data-sets/crops/96120/

Here are a few more prices pieced together from the following
articles... apparently the pre-1862 prices experienced significant
disruptions with the "Panic of 1819" and the affects of the Civil War
leading to at least two major boom/bust cycles.

North Carolina. General Assembly. House of Commons
A Bill to Limit the Production of Cotton and Tobacco in the Year 1864.
House Bill, No. 3, Ses. 1863
[Raleigh, N. C.}: W. W. Holden, Printer to the State, 1863. 2 p.

Alabama agricultural museum
http://www.alagmuseum.org/new_page_7.htm

Pacer, Robert, F., Cotton’s Importance to the South:1862 price
http://www.mcm.edu/~pacer/oldsouth/staples1/cotton/

Trumbore, Brian, Cotton – Eli Whitney Part 2
http://www.buyandhold.com/bh/en/education/history/2001/cotton2.html

1818 32.5
1819 14
1840-1850 < 10
1855 above 10
1856 15
1862 62 high

Various search strategies were followed (most unsuccessful):
cotton price year : where year equalled 1800, 1875 etc) yielded the
most results.

I think, all that remains is to rate the answer.

The USDA link appears broken, but there is a research tool at https://www.nass.usda.gov/Charts_and_Maps/Agricultural_Prices/
 

Drew

Major
Joined
Oct 22, 2012
What I found. No expressed or implied warranty.
http://answers.google.com/answers/threadview?id=33770



The USDA link appears broken, but there is a research tool at https://www.nass.usda.gov/Charts_and_Maps/Agricultural_Prices/
It's a shame this doesn't address Antebellum cotton prices. It does say there is no inflation adjustment, which is interesting.

Inflation really didn't begin until the early 20th century. They didn't experience it in the 19th.

FWIW, cotton closed at 77 cents per pound this afternoon. Ouch.
 
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leftyhunter

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Location
los angeles ca
getting back to the ACW. Cotton was highly profitable has many historians such has David Williams points out. It was easy to find domestic or foreign buyers. Union military officials would buy cotton from Confederate growers and sell it to cotton brokers in the north who in turn sold it to domestic factories or to foreign buyer. Cotton shipped from a Northern port on a foreign flagged vessel has no worries. Even with the blockade their was plenty of smugglers willing to risk their lives. In a sense cotton was still king because the price was still high. On the other hand foreign competition would in the long term insure that Southern cotton would never have the near monopoly it enjoyed in the antebellum era. I can get sources tommorrow.
Leftyhunter
 

jgoodguy

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ACW price high because of blockade. After war price collapsed because of stagnant demand and over production. Surprised the experts at time who elect return to pre war increasing demand. In a sense, secession was for naught because the good times were over and the cold dead hand of economics had slavery by the throat long term.
 

Drew

Major
Joined
Oct 22, 2012
ACW price high because of blockade. After war price collapsed because of stagnant demand and over production. Surprised the experts at time who elect return to pre war increasing demand. In a sense, secession was for naught because the good times were over and the cold dead hand of economics had slavery by the throat long term.
Good points, but no one should be surprised. History is littered with folks participating in economic booms who could not believe it would ever end. "It's different this time," is the usual mantra. When you hear that, grab your wallet and run.

It's been going on for a thousand years, probably a lot longer than that.
 
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jgoodguy

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Good points, but no one should be surprised. History is littered with folks participating in economic booms who could not believe it would ever end. "It's different this time," is the usual mantra. When you hear that, grab your wallet and run.

It's been going on for a thousand years, probably a lot longer than that.
You might be on to something there.
This Time Is Different: Eight Centuries of Financial Folly:
Manias, Panics, and Crashes: A History of Financial Crises
41kQBl7uM7L.jpg



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