pronounced exception to. The grades deliverable on New York contract, and the stock of cotton in New York at any season, are both spinnable and merchantable cotton. There may be a few bales which should not have been delivered on contract. A bale or two now and then will creep in which the classer overlooks.

Should this happen in the New York Cotton Exchange stock, the receiver of that certificate containing that faulty bale has redress. The handler of spot cotton in the South who takes delivery of that kind has no redress.

The New York Cotton Exchange, by its certificating system, stands ready to make good the class of any bale which any receiver of that certificate receives against the tender to him of spot cotton against the contract he has bought for future delivery. Notwithstanding the large stock of so-called unspinnable and unmerchantable cotton which the defamers of the New York Cotton Exchange have been so freely saying has existed in the past four years, that cotton has all gone into consumption; and I will defy anyone to produce a spinner who bought that cotton and have him say that it went into stuffed horse collars or Ostermoor mattresses. The refuse of low-grade cotton may have been used for that purpose, and if it please the gentlemen of this committee, as soon as I get through here I will show them the kind of stuff that comes out of low-grade cotton.

There is deliverable in New York contracts 16 grades of white cotton, ranging from good ordinary white to fair. It is perhaps, gentlemen, a misnomer to say there are 16 grades. I should say 16 qualities, embracing whole grades, half grades, and quarter grades. In addition thereto, there is deliverable on contract 6 grades of tinged cottons and 1 grade of stained cotton; in all, 23 characters of cotton, including white tinges and stains.

We have been held up to ridicule to the commercial world for having so many grades of cotton deliverable on contract. Gentlemen, in justice to the farmer, I want to go on record here before you personally and say I wish every grade of cotton that was classable which the farmer produces could be made deliverable on contract. Why? Because it furnishes the farmer, who has no control over the quality of his product, a market at its relative value which the spinners can use and do use in the manufacture of cotton cloth and various other branches of manufacture.

Mr. LEVER. There is no cotton raised that is not spinnable, is there? Mr. NEVILLE. Yes. There is some cotton received that is not spinnable, and that is the stuff that some of our defamers have been confounding with cotton that they think is deliverable on contracts in New York. I want that to go in the record.

The Bureau of Corporations practically has approved the present method in New Orleans, and in the approving of that method they have 19 grades of white cotton that is deliverable on contract, and 11 qualifying descriptions of these white grades, and according to their by-laws it is possible to have about 140 qualities, which are deliverable on contract; making it possible to have 209 descriptions of cotton in New Orleans; and I submit here as evidence the certificate of the rules and by-laws of the New Orleans Cotton Exchange issued to its members after that certificate system was approved.

The following form of contract shall apply to all contracts maturing during and after the month of February, 1910:

CONTRACT.

NEW ORLEANS..........19..

In consideration of one dollar in hand paid, receipt of which is hereby acknowledged, ..have this day sold to (or bought from). ..50, 000 pounds in about 100 square bales of cotton, growth of the United States, deliverable from press or presses, railroad depot or depots, in the port of New Orleans, between the first and last days of.. next, inclusive.

The delivery within such time to be at seller's option, in not more than two places, upon five days' notice to the buyer.

The cotton to be of any grade from Good Ordinary to Fair, inclusive, and is stained, not below Middling, and if tinged, not below Low Middling, at the price of......cents (......) per pound for Middling, with additions or deductions for other grades, according to the quotations of the New Orleans Cotton Exchange existing on the sixth (6th) day previous to the day on which delivery is due.

It is distinctly understood and agreed that the receiver of cotton under this contract shall have the right to refuse all bales that contain perished staple, and all sandy, dusty, red, or gin-cut cotton; dusty cotton being defined under this contract as cotton lessened in value more than c. per pound by reason of dust; sandy cotton being defined under this contract as cotton containing more than 1 per cent of sand.

Either party shall have the right to call for a margin, as the variations of the market for like deliveries may warrant, and which margin shall be kept good.

This contract is made in view of, and in all respects subject to, the rules and conditions established by the New Orleans Cotton Exchange, and in full accordance with rule 55 of said New Orleans Cotton Exchange.

For the purposes of this contract, Westwego and Southport are not included as places of delivery.

Signed....

FORM OF CLASSIFICATION RETURNS.

Rule 36.-In classing cotton the following form of return shall be used:

The limit of grades tenderable is prescribed by the contract; no returns to be made

of nondeliverable grades.

Gentlemen, as I stated to you this morning, the members of the New York Cotton Exchange and I may say the other exchangeswelcome Mr. Burleson's resolution prescribing standardization of the grades of cotton, and I think Mr. Burleson, without intending it, has worked a hardship on the producer of cotton in not embracing in that requirement standard classification for tinges and stains. There are times in the raising of this crop when weather conditions make a preponderance of tinges and stains in cotton.

Mr. LEVER. Just what is the difference between tinges and stains? Mr. NEVILLE. The difference between a negro and a mulatto. That is not intended as a short answer.

Mr. LEVER. It does not quite answer the point I had in mind.

Mr. NEVILLE. I wanted to answer you as briefly as I could, and I thought that described it. It is the difference, I should say, Mr. Lever, between chocolate with a little cream in it and chocolate with a great deal of cream in it.

Mr. LEVER. A difference in color?

Mr. NEVILLE. Yes. Gradations owing to the number of frosts the cotton has encountered, and the weather it encounters after the frost, up to the time it is gathered.

Mr. LEVER. The tinge comes more from frost bite, and your stain more from dirt, does it?

Mr. NEVILLE. A combination of the two; the frost and then the weather after the frost. It may not be known to you gentlemen, but the finest spinning cotton out of any crop are the tinges and stains, so far as the tensile strength of the fiber and the waste in manufacture are concerned.

The CHAIRMAN. Is there any process by which this stain and tinge cotton can be made perfectly white?

Mr. NEVILLE. They do not want to bleach it; they use it in colored goods, because it takes the dye better. We-and when I say "we" I mean the merchants of this country-will join Mr. Burleson, and I as a committee who assisted in the preparation of these standards in compliance with Mr. Burleson's resolution, will gladly offer my services to the Government to standardize tinges and stains; not that year in and year out they would be serviceable, but when a calamity comes to the producer, I ask you gentlemen, in all fairness, is it fair that that producer should not have some standard by which his crop may be measured?

Now, gentlemen, the question of quarter grades comes in. A quarter grade is a grade between this box and this box [indicating]. The CHAIRMAN. Indicating low middling

Mr. NEVILLE. Indicating the box between strict low middling and low middling, indicating fully low middling. The word "fully" has come down to us in the shape of an inheritance from our English spinners, and the trade as they have that name have distinguished what is known as the quarter grades. These grades have been made with a view of having the classification over this country in such a way that this box here (strict low middling) will go Liverpool middling as commercially used. For cotton exchange purposes in Liverpool, that box [indicating] would not go Liverpool middling. Why? That is a buyers' market. It is a buying country. And when you hold an arbitration they exact the last pound of flesh. So that the

middling, in common acceptance of the trade, is not middling with their standard of classification for arbitration purposes.

I do not wish to criticize the method pursued in distributing these types in what I am going to say. The secretary can take this down, although it has no particular bearing on the main subject which we are discussing. It has, however, an important bearing in what I want to say a little further on.

The method of distribution as adopted by the Agricultural Department is one that necessarily is bound to be slow of accomplishment. For this reason: They have got to bring the cotton here to make up the standards for each box. You gentlemen can readily see the enormous labor and expense it is to bring cotton here from the South to put in these boxes, make it up, look it over, and send it back. It takes two or three men constantly working on it. And the one central point can not distribute as many as many subsidiary points could.

I suggested at the meeting which was held a year ago this month, in Washington, that when the committee fixed these standards they fix five sets, one set to be sealed by the Government and kept intact, another set to be kept by the Government for comparison purposes; and the three other sets to be sent, one to the New Orleans Cotton Exchange, one to the Texas Cotton Exchange, and one to the New York Cotton Exchange, so that people who wanted those types from those various localities could send to the exchange and have those types made up, based on the types which they received from the Government.

But before those types were sent out to the parties requesting them, those types should be forwarded by the exchanges to the Agricultural Department here at Washington and those types viséed by the department and the man in charge, and after he had made a comparison and approved of them, put his stamp of approval on them and send them direct to the people who asked for them, under Government seal.

I offer that now as a suggestion to the committee, in case your committee has anything to do with consulting the Secretary of Agriculture on that line.

That part of my talk is, perhaps, unnecessary, but it is made in my earnest effort to try to get these types distributed as quickly as possible.

The CHAIRMAN. Do you think it would be better than for the department to make up a large number of sets of these samples and send them out on demand?

Mr. NEVILLE. I think it would be quicker, and I think it would be more economical.

Mr. BURLESON. That is undoubtedly true, and will probably be the course adopted by the department just as soon as the exchanges adopt these standards.

Mr. NEVILLE. The exchanges are willing to adopt the standards as soon as they receive the first box.

Mr. BURLESON. Well, it was left rather indefinitely, I think.

Mr. NEVILLE. No; I beg your pardon.

Mr. BURLESON. The New Orleans people expressed a willingness to do it, but the New York people

Mr. NEVILLE. You are wrongly informed. I was the first one, and the records of the department will show that I was the first one, to make a request for two sets of the standards that we wanted to adopt. The records will show that.

Now, gentlemen, I apologize for taking that much time to explain that phase of it.

Mr. Chairman, with your permission, we have here an expert classer, who is working for the department now making these types, and I have made a statement that the quarter grade between this box and this box, and this box and this box [indicating], and this box and this box [indicating], and this box and this box [indicating], and this box and this box indicating], were a definable grade. He is an expert classifier of cotton, and with your permission I would like to produce him as a witness to testify to questions that I will ask him, subject to cross-examination.

The CHAIRMAN. They relate only to the classification?

Mr. NEVILLE. They relate only to classification; yes.

Mr. BURLESON. I do not think there is any controversy about that. The only question is whether it is practicable or not, and whether these quarter grades are used.

Mr. NEVILLE. Yes; they are used.

Mr. BURLESON. My contention is that they are not used, that they are not brought into use by the producer when he sells his cotton, and consequently it was not necessary for the Government to go to the expense of a gradation of that kind.

Mr. NEVILLE. I am not speaking of the expense of a gradation; I am speaking of what happens every day when the farmer sells cotton.

Mr. BURLESON. You may take the quotations in the southern papers, and you will see that they only quote seven full grades, not even nine grades. Take this morning's issue of the New Orleans Times-Democrat, and you will find that they do not quote as many grades as nine.

Mr. NEVILLE. I am not here to argue that with you at all.

Mr. BURLESON. Is not that the fact?

Mr. NEVILLE. I don't know whether it is a fact or not. I am a poor hand to carry figures in my mind. I am not arguing it from your point of view at all, Mr. Burleson.

The CHAIRMAN. The only question in the mind of the committee is whether there is any controversy about it.

Mr. NEVILLE. There is a controversy. We have been accused openly of having quarter grades on the New York Cotton Exchange which were undefinable and were not used in ordinary trade.

Mr. LEVER. I do not see any reason why we should not go ahead and let the witness testify.

The CHAIRMAN. Is Mr. Barbot the gentleman you wish to put on the stand?

Mr. NEVILLE. Yes.

The CHAIRMAN. Very well; will you be sworn?

Mr. BARBOT. I am sworn; I am an officer of the Government.