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growth and development of this trade may have important effects on the commercial condition of the whole of Manchuria, a brief account of the origin and present state of the trade may be of interest.
The soya bean has been largely grown in Manchuria for many years past, and beans and beancake have been one of the staple exports of the country for many years, the destination being Japan and South China where the cake is used mainly as a fertilizer. Up to the year 1907, however, as far as can be ascertained from the only customs figures available, those for the port of Newchwang, the export did not exceed 120,000 tons annually. During the year 1908 the export rose to approximately 330,000 tons, one half of which was exported from Dairen; of the remainder 100,000 tons were shipped from Newchwang and 65,000 went out by rail via Suifenho. This increase was almost entirely due to the demand from Europe, which continued throughout the present year, and seems likely to increase rather than diminish.
Taking the customs figures from October 1908 until June 1909, no less than 660,000 tons of beans left Manchuria, 341,000 from Dairen, 177,000 from Suifenbo, and 142,000 from Newchwang.
Beans were still being shipped throughout July and August, so that the total of last year's crop exported may be estimated between 700,000 and 800,000 tons.
I am informed that 450,000 tons approximately of this amount were exported to England, 300,000 tons of which were sold in London by the Mitsui Bussan Kaisha. The British firms who engaged in the trade bought mainly at Dairen, and as the Japanese firm was in a position to control the market both in Manchuria and London, they did not, I am led to believe, find their ventures profitable. The Mitsui firm bought largely direct from the farmers, having in their employ a large number of agents both Chinese and Japanese, who travelled in the interior on their behalf. Against an enterprise so well organised it was, of course, difficult for any individual firm to make headway, and it appeared at first as if the export to Europe would strengthen rather than diminish the Japanese commercial position in Manchuria.
That Japanese imports, especially cottons, have improved consequent upon the development of the export trade is undoubted, and even a slight knowledge of the financial conditions obtaining in Manchuria will show the enormous advantage control of exports gives to the importer.
The principal distributing centre for the Kirin province at present is Ch'ang Ch'un which is also the chief bean market in Northern Manchuria. Transactions amongst Chinese in this mart are settled in "tiao" notes, ie., notes issued by the Kirin Provincial Government Bank, the head of which is the Governor of Kirin. These notes were originally worth 40 cents of the so-called Manchurian small coin. The small coin consists of 10 and 20 cent pieces coined locally, which exchange on the average at the rate of 110 cents small coin to the Mexican dollar.
Owing to the financial necessities of the provincial government, the issue of these notes had been so increased that it is said now there are 80,000,000 in circulation, presumably against no reserve of silver. In fact the export of small coin silver from Kirin province has been strictly forbidden for the past three years, and in the case of British firms I have been compelled to apply for special permission to export. In consequence of these conditions the "tiao" has fallen from 25 to 30 per cent. in value, and is subject to daily fluctuations not only vis-à-vis the small coin, but the various other coiuages in use at the mart, viz., Japanese gold yen, Japanese silver yen, roubles and taels. These Auctuations are of an extraordinary nature, as the following figures showing the daily value of the "tiao" notes for one week as against the other currencies will show.
Date.
Gold Yen.
Silver Yen.
Roubles.
Small Coin.
Tacls.
July 22
4,540
3,750
4.650
3,285
5,205
23
4,560
3,763
4,685
3,820
5,275
24
4,510
3,735
4,645
3,300
5,252
25
11
4,520
3,750
4,660
3,800
5,625
26
IS
4,560
3,780
4,680
3,325
5,827
27
**
4,500
3,760
4,675
3,310
5,295
גו
overcome the difficulties of exchange, and, in my opinion, it is to this cause that the improvement in their import trade may be largely attributed.
The present bean season has, however, commenced with a strong attack on the Mitsui's position. In Ch'ang Ch'un a powerful Chinese syndicate has been formed, which has bought most of the local crops, and has already made large contraels with British and German firms. A similar Chinese syndicate is also working in the Hei Lung Chiang province.
Last season practically the whole of the crop in the Chang Chun district, say, 250,000 tons, was carried to Dairen or Newchwang, only 5 per cent. of the total to the latter port, by the South Manchuria Railway. A certain proportion of this supply is grown to the north of Chang Ch'un and could be more expeditiously and economically conveyed by the Chinese Eastern Railway. The British and German firms have now, I understand, come to an arrangement for the storage of beans at points on the Chinese Eastern Railway line, and their shipment to Vladivostock at rates economically equivalent to those charged by the Southern Manchurian Railway.
Owing to this competition the prices paid for the beans have risen very con- siderably. Last season at Chang Ch'un they varied from 12 taels to 25 taels per ton, and at Harbiu from 23 kopecks to 50 kopecks per pood of 36 lbs., .., from 18:30 roubles to 32-34 roubles per ton; the higher prices, however, only being obtainable towards the end of the season. The freight from Harbin to Vladivostock was 15 50 roubles per ton, and from Ch'ang Ch'un to Dairen 12-10 roubles per ton.
During the present season the market at Harbin opened at 40 kopecks the pood, has risen to 47 kopecks, and is still rising, whilst at Chang Ch'un the first prices asked were 25 taels per ton.
The present freight rates from Ch'ang Ch'un to Dairen, including f.o.b. charges are 9:32 gold yen per short ton of 2,000 lbs., whilst the new Chinese Eastern Railway. rate, also including f.o.b. charges, from Chang Ch'un to Vladivostock is 18:30 kopecks per pood (10:15 roubles per short ton).
The freight from Vladivostock to London is slightly more than from Dairen to London; but whilst beans exported via Dairen pay a 5 per cent, export duty, by the regulations prevailing on the Russo-Chinese frontier, a duty of only two-thirds of
per cent. is payable at Suifenho station.
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The distance from Vladivostock to Ch'ang Ch'un is 585 miles, whilst from Chang Ch'un to Dairen is only 438 miles; but this is compensated for by the dealers in the districts north of Chang Ch'un being able to bring their cargo to points on the Chinese Eastern Railway, and thus save the cart hire and expense of carrying the That this saving may goods to the Ch'ang Ch'un market as they have hitherto done.
be considerable can be shown from one instance that has been brought to my notice. Owing to the badness of the roads in Kirin province it 100k four meu fourteen days to bring in beans to Ch'ang Ch'un valued at not more than 27.
The fact that it is economically possible for the Chinese Eastern Railway to compete at Chang Ch'un with the South Manchurian Railway must be of advantage to the exporter, and lead to the development of the trade should the demand from Europe continue, as there seems every prospect of its doing.
At present prices-say 61, 108. per ton laid down in London-experts estimate that Europe can take annually no less than 1,000,000 tons of beans, and there is little doubt but that at this price the supply would be available. The beancake exports in 1908 amounted to 500,000 tons, and from October 1908 to June 1909-i.e., the 1908 bean crop-the export rose to 570,000 tons. The native mills, I am informed, only extract from 6 to 7 per cent. of oil from the raw product, and if the demand continues the Chinese will find it more profitable to divert a portion of the beans used in these mills to Europe.
There is further abundant space for development; it is estimated that not more than two-fifths of Kirin province is under cultivation, and considerably less than that proportion in Hei Lung Chiang.
The above considerations appear to me to indicate that the present commercial conditions in Northern Manchuria are of sufficient importance to warrant the appointment of a consular officer of suitable rank to be stationed either at Harbin or at Ch'ang Ch'un in the near future.
I have, &c.
ROBERT WILLIS.
With a currency of such a chaotic nature it is evident that the Mitsui Bussan Kaisha being large buyers, as well as large sellers, were enabled to a large extent to
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