Affairs of the East India Company: Minutes of evidence, 25 June 1830

Die Veneris, 25 Junii 1830.

[673]

The Lord President in the Chair.

Walter Stevenson Davidson Esquire is called in, and further examined as follows:

Do you think the Existence of The East India Company as a Trading Company at Canton affords any Facility to Remittances to India or to Europe?

In my Time it did in the greatest degree; I should have been otherwise often at a Loss; I was in the habit of resorting to their Treasury every Season; and when it happened that they declined to draw either on India or on England, my Constituents and myself were deeply disappointed.

Does not that Difficulty of making Remittances on the Part of Merchants trading to the Port of Canton result from the Circumstance of their not being permitted to make Remittances in Tea to this Country?

Certainly, in a great degree; having no Investment to provide for Europe, we could only resort to The East India Company for a Remittance in Bills.

Then the Difficulty is created by the Monopoly of The East India Company in the Article of Tea, and is removed only at their Pleasure?

Precisely so, as far as regards Remittances to Europe.

Do you think the Position of Merchants residing at Canton would be better or worse, if the Trade were open, in that Matter of Remittances?

Much better, if the Trade were open and conducted on sound Principles.

What Engagements did the Owners of Country Ships enter into with the Governments of India?

I will speak of Bengal with which I am far best acquainted. Before sailing from Bengal, the Owners of all Country Ships are obliged to give to the Government a Bond, in which Bond they bind themselves under certain Penalties to conform to the Orders and Restrictions of The East India Company's Representatives in China; and on their Arrival in China, the first Thing which is done is to receive the Instructions of the Committee of Supercargoes with regard to their Conduct while in the Port.

Do you happen to have a Copy of that Bond?

It is in my Possession, but my Papers are not within my Reach at this Moment. The Trade between India and China (that is the Country Trade) is a Trade of a Nature which does not seem to be generally understood in this Country, and is merely a Trade of Sufferance.

Is not all Trade a Trade of Sufferance on the Part of the Government, which might prevent it if it pleased?

The Legislature of this Country has given to the British Merchants in India that Trade as a Trade of Sufferance, to be permitted to enjoy it under the Regulations of The East India Company.

The Legislature has given to The East India Company the Power of preventing it?

Yes, I believe so.

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Are there any Restrictions placed on the Exports of British Manufactures from India to China— Woollens and Cottons?

In my Time there were; but they have been partially removed of late Years, I have been told.

You cannot state the Date of the Removal of that Restriction?

I think I may say within the last Ten or Twelve Years.

Was that Restriction removed on any Representation made by any Merchants resident in India?

I cannot speak from Knowledge; but I have very little Doubt it was removed at the Time The East India Company ceased to find it much their Interest to enforce it.

Do you happen to know whether Advantage has been taken of the Removal of that Restriction from the Import of British Manufactures into China from India?

I have heard it stated to be so; I have understood that it has been done profitably.

What particular Species of Manufactures?

I really cannot enumerate them.

They have not been to any great Extent?

No, I think not; principally by the Officers of Ships. I should think not to an Extent sufficient much to attract the Attention of the great Houses in India.

What were the chief Articles consigned to you for Sale in China by your Constituents?

The chief Articles were Cotton and Opium; they formed, I think, upwards of Nine Tenths of my Consignments.

What were your Returns?

Besides the Supercargoes Bills on the Indian Government, when they drew, I remitted very largely in Sycee Silver, the Production of China, in Tutenag, and many other Articles.

Any in Dollars?

Sometimes in Dollars. We were occasionally compelled to remit in Dollars, owing to the Difficulty of smuggling the Sycee Silver; but never resorted to that Mode, I think, when we could obtain the Sycee Silver.

The Dollar in China is very much beaten and broken, is it not?

Constantly cut and clipped in all Directions; it almost ceases to be a Dollar when it has circulated in China; there it is weighed as Silver; all Payments are made by Weight.

Is the Dollar, in consequence of this beating and breaking, diminished in intrinsic Value in China?

The Moment the Dollar is clipped it cannot be said to diminish in Value, because it will be taken afterwards just for its Weight in Silver, although it be punched and clipped through and through.

When we hear of the Exchange at so much a Dollar, does that mean the Dollar clipped and broken, as it is in China, and so reduced below the Value of the good Spanish Dollar, or is it in Exchange with the Quantity of Silver which there ought to be in a good Dollar?

Yes, precisely so. What is understood in China by a Dollar is a Piece of Silver which contains Seven Mace Two Candareens, or Seventy-two Hundredth Parts of One Tale, containing a Hundred Candareens.

Is that the intrinsic Value of the Dollar as it leaves the Spanish Mint?

It has no comparative Connection but with other Silver; it is paid in China as the Weight in Silver; and all Coins, whether Spanish, or Portuguese, or German, they are shroffed, as it is called, and ascertained to be Silver, and are then put together, and the whole Mass weighed.

So that the Dollar is received by Weight and not by Tale?

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It is sometimes received by Tale; and I will explain this, as it shews the extreme Ignorance of the Chinese in Matters of that Nature. I have had Spanish Dollars bearing the Head of Charles, the former King of Spain, and I have sold those Dollars, and received Dollars bearing the Head of Ferdinand his Successor, Coins precisely of the same Nature, and I have received from Two to Five per Cent. Premium upon the Charles's. When I say the same Description of Coin, I mean they would be the same in London. The Ferdinands may have been a Fraction deteriorated, as they were coined about the Time of the Revolution: the Chinese found out their Mistake, and ceased to carry on that Operation. The Chinese are a People much attached to old Customs; and as the People in the Interior had been long accustomed to the Charles's, they had an Objection to any other, the Spanish Dollar being sometimes found very desirable in the Chinese Provinces, owing to their Want of a current Coin.

The Shroffs in Canton, and in every Part of China, are very attentive to the Quantity of Silver contained in Coins, are they not?

Yes; and very expert in their Business. I do not remember ever losing One Dollar from my Shroffs.

Forgery of Money is very rare, is it not?

Very rare; there can hardly be Forgery in a Country where no Paper Money exists; where all the Gold and Silver Coin is shroffed, and the Money taken by Weight.

Except in the Importation of Cotton, which is likewise imported by the Company, the Country Trade in no respect competes with the Trade of the Company at Canton, does it?

In no respect but in Cotton and Opium.

Is not the Prosperity of that Country Trade essential to the Realization of the Funds in Canton required for the Homeward Investment?

It was constantly in my Time; but it was reciprocal; I was equally anxious to receive their Bills as they were to receive my Dollars.

So that the Company are interested in the Maintenance and Extension of the Country Trade?

Yes. In former Days I have bought largely of the pure Sycee Silver of China, which we considered to contain Ninety-eight Parts of Silver out of the Hundred, and I have paid for it in Spanish Dollars, such as I alluded to before, which only contained Ninetytwo Parts of Silver in a Hundred; consequently, the Chinese, for the Facility of having that Coin to send into the Interior, paid Six per Cent. Premium.

Is the Sycee Silver to be obtained in any great Quantities?

As large Quantities as we generally required; but the Difficulty was the shipping it; there were Periods when it could not be smuggled on board. It is in Lumps containing Ten Tales; not a mis-shaped Mass, but cast in a Mould, and a very compact Mass.

From whence does it come?

From the Interior, higher up the Country; it is a Dump rather than a Bar; it comes from their native Mines.

What, in your Opinion, would be the Effect of open Trade on the Price of Teas?

The first Effect would naturally be to raise the Price, because a Number of eager Speculators would rush into the Market; but there is no Reason to suppose that that State of Things could continue; ultimately the Tea Growers and the Tea Merchants would of course be satisfied with remunerating Prices.

Do you think there would be any Difficulty on the Part of the Chinese in furnishing a much larger Supply, to the Extent of many Millions of Pounds of Tea?

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I have always understood not; to any Extent that this Country could require.

Do you apprehend that the Americans obtain their Teas at as low a Price as the Company?

I can entertain no doubt of it now-a-days.

Do you think they obtain Teas of as good Quality?

In my Time, I considered decidedly not, nor did they generally seek to do so, as I always understood.

Are Teas as good as the best obtained by the Company to be found in the open Market at Canton?

Certain Parcels may be so, I believe, but certainly not in large Quantities so good as the Company's prime Contract Teas, in my Time.

Is the Difference great in the Price of the new and the old Tea at Canton?

It is very variable; it will depend on many Circumstances. If many new Teas come down, and there is but a small Demand for them, it will tend to keep down the Price of the new Teas as compared with that of the old; but if when the new Teas come down there are many Foreign Ships come in, and there is a great Demand, the new Teas, which will be preferred, will surpass in Price the old Teas greatly.

The new Teas are better than the old?

Yes, I should say decidedly so.

Can you at all estimate the Deterioration which takes place in Green Tea in the course of Twelve Months?

It will in a great measure depend on how it is packed, or whether it is exposed to Air or Moisture, I apprehend.

Does Exposure injure it?

It loses its Bloom; it is much injured by being badly kept. The Chinese have a Method, which is constantly practised, of making their old Teas look new, by submitting them to an Operation which is termed firing, and putting a fresh Bloom upon them.

How do they do that?

It is generally understood that while they are exposing them over Heat, a Substance, some say containing a minute Portion of Prussian Blue or other such deleterious Substance, is sprinkled; but I believe that the Substance is not so deleterious as has been thought.

But the thing is done?

Yes, I have understood it is done constantly. Teas are freshened, and those who do not understand them are sometimes thus imposed upon.

They are taken in by the Sight, not by the Taste?

A Judge would discriminate.

Does that apply to both sorts?

I think to Greens in particular.

Do you consider that the Population of China generally is very much interested in the Continuance of the Trade with this Country?

I cannot speak to it generally; but as to the Province of Canton in particular, which is a large, populous and thriving Province, I should say it is most materially interested; and, consequently, I should think that the Peace of China is in some degree dependent on the Continuance of the Trade with Foreign Countries.

It is likewise the Interest of Government to maintain a Trade, is it not; the Government deriving large Duties from it?

Decidedly their real Interest.

Is it not likewise the Interest of the Hong Merchants?

Beyond all Doubt.

Under those Circumstances, a very strong Interest existing on the Part of Government, of the Merchants and the People of China, and smuggling existing to so great an Extent, do you apprehend any Circumstances are likely to arise which could put a stop to that Trade?

Yes, I do; and I expect it to happen every Year.

Will you state what that is?

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I believe there is a Line, although I cannot pretend to be able to define it, beyond which the Chinese Government will not go in adjusting serious Differences, and particularly in regard to Homicide Cases, with any Representative of this Country who has ever yet resided in China.

Do you mean that the Chinese Government would sacrifice the whole Trade rather than not succeed in inflicting on Foreigners trading there some particular Exactions they might desire to enforce?

I mean that they will one Day or other so egregiously commit themselves, that their Pride, their arrogant Self-conceit and Ignorance, will prevent the Adjustment of the existing Dispute until a Negociation is opened direct between the English Government and theirs.

Do you mean that this complete Prohibition of Trade with Foreigners by the Chinese Government will take place whether the Trade is thrown open or not?

Yes, unavoidably, I think, sooner or later, under the present unwise and undignified System.

Do you imagine it will occur earlier under an open Trade, or the present System?

Earlier under an open Trade, unquestionably.

You mentioned that you did not think the Americans were desirous of purchasing the superior Qualities of Tea; what induces them, in your Opinion, to prefer an inferior sort of Tea?

They often come in quest of Teas for different Markets, and they will naturally search for a Description of Tea they can sell at such a Price as the Parties for whom it is meant are in the habit of giving or may be disposed to give, either on the Continent of Europe or in America.

You conceive it was not because they could not procure a superior Quality of Tea, but that they find the inferior more marketable and more beneficial to them?

There cannot be supposed to exist any Difficulty in the Americans obtaining the best Article which was to be found in the Markets of China. The Chinese will deal with any one who brings Money or Credit.

Do you think that if The East India Company was to be deprived of its Monopoly in the China Market, it would lead to the Extinction of the Hong Monopoly?

That would not follow, but must depend entirely on the Chinese Government. If the Hong Monopoly be continued with an open Trade to this Country, it will always be getting worse and more vexatious. Indeed I see no Salvation for an open Trade, in the Absence of the Power and Political Influence of The East India Company, without a previous Understanding between the Two Governments.

When you said there was a certain Line which the Chinese Government was in the habit of adhering to, did you mean to say that they pursued a certain System of Government which has never changed within the Memory of Man, and that you thought was not likely to be changed?

Precisely so; and the Line to which I alluded is of course a Line that I cannot pretend to define; I do not know where that Point is; but I believe that one of these Days we shall pass it, and then this Country will be compelled to do, what it has never yet done, negociate direct and vigorously, and not through the Medium of complimentary Embassies; we might send Fifty merely complimentary Embassies, and they would do no Good, but rather Mischief, in my Opinion.

What is the Embassy you would recommend?

Such an one as this great Country is wont to send to all other Countries excepting China; a manly Proposition of amicable, reasonable and mutually advantageous Intercourse.

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If they refused to receive the Ambassador, what would you propose to be done?

Give up drinking Tea, or else enforce the Reception of so just an Intercourse.

Do you know any thing of any contraband Trade being carried on in British Ships to other Parts?

Country Ships have gone on the Coast, particularly with Opium, but they have seldom met with Success.

They have gone to Amoy and Parts North of Canton?

Yes, they have; but it is seldom resorted to now, I believe; the Opium Trade is now so comfortably circumstanced, they do not require any Improvement.

Supposing the Trade immediately with China to be suspended, do not you think that this Country might be supplied with the Quantity of Tea wanted through Sincapore and other Ports?

The thing is possible, but I should think fraught with Difficulty.

Do not the Chinese carry on a large Trade with the Eastern Islands?

Yes, in Junks, they carry on a large Trade.

Those Junks convey Tea?

Yes; but whether the Chinese Government would consent to see England supplied with Tea in that Manner, I cannot say; and certainly they would tax it most severely, if they did.

Did those Persons for whom you were Agent while in China send any Quantity of British Manufactures into China?

No, not in my Time, any great Quantity.

Are you of Opinion that if the Monopoly was at an end, there would be an increased Demand for British Manufactures in that Country?

Unquestionably an increased Demand would grow up; enterprising Manufacturers in this Country would send Manufactures, and lose a great deal of Money, probably, in the first instance, but that would create a Taste, and I have no doubt that vast Quantities of British Manufactures would be sent ultimately.

What sort of Manufactures do you think most likely to be sent?

I should think that the Articles now sent would be sent on a larger Scale; Cloths, Metals, Cotton Goods and Sundries.

Has the Quantity that has been imported into that Country by the Americans given the Chinese an increased Taste for those Manufactures?

I really hope so.

Are you aware whether that is so or not?

It is some Years since I quitted China; I cannot doubt that it has done so, however, and I have heard often that such is the Fact.

Have you made any Calculations as to the Profit or Loss of the Trade carried on by The East India Company with China?

No, I have made no Calculations in particular, but I have inspected for many Years the Accounts of The East India Company in the most authentic Shape.

Have you collected from them the Extent of Profit which The East India Company derive from that Taade?

[679]

On that Point I beg to state that I resided some Years in China in conducting a large Business; I have visited all The East India Company's Presidencies in India; and I can with Truth, as I do with Pleasure, bear the strongest Testimony to the liberal Manner in which their Government is conducted, which seemed in my Time to be universally considered. As a Sovereign Power, they are all that can be desired for those Countries; but in their Capacity of Merchants, from the most attentive Perusal that I can give their Accounts, I am sorry to say that I think it has been a complete Failure, and that they have reaped from their Trade, as a whole, nothing but Losses to their own Corporation and to this Country at large. During my whole Residence in China I can with Truth say that I cannot call to mind an Instance in which the Company's Representatives there have proved recreant in their sacred Duties towards British Trade in general; not even inattentive, far less inimical to its Interests.

With regard to the Profit and Loss from the Manner in which they conduct their Trade, do you conceive they do that in a Manner equally advantageous to themselves that private Individuals would conduct the same Trade?

I am sorry to say I do not think so, nor do I think that any public Body, constituted as The East India Company is, can possibly compete with the quiet Enterprize and economical Management of the intelligent and industrious individual Merchants of this Country; and this is nothing but the unavoidable Result of such a Combination of Circumstances.

Have you formed an Opinion as to the Necessity for such an Extent of an Establishment for the Conduct of their Commercial Affairs as is kept up by the Company in China?

The Expence of the Company's Establishment in China is not great; I believe it to be not much more than what the Commission would be payable to myself or other private Agents in the Conduct of so extensive a Business.

You think the Company do not pay more for the Conduct of their Commercial Business in China than private Individuals would do?

Very little, I think.

Then what is the Difference between their Management and that of private Individuals?

The Expence of all their numerous Establishments in all Parts of the East. In one of about Twenty-five Persons, as in Canton, it does not much signify how expensively those few Persons may be fed or housed; but The East India Company have such huge Establishments throughout India as must have eaten up all their Commercial Profits, and they have done so, I fear greatly, besides a good deal of the Territorial Revenue.

Supposing the whole of their Commerce abandoned, except that to China, do you think that Trade is as economically managed as a Trade of that Magnitude in the Hands of Individuals would be?

I am of Opinion that there would not be found to exist a great deal of Difference.

Does your Answer apply to the Establishment at Canton only, or their Manner of building Ships?

I speak of their Establishment at Canton only.

Do you take into your Consideration the large Ships, the Freight they pay, and the sort of Goods they export to China?

By no means. I only speak of the Sale in China of their Imports, and the Expence attendant on the providing and loading of the Homeward-bound Cargoes, and the Maintenance of their Servants on the Spot.

And the Purchase of their Teas?

Yes; the Purchase of Teas is included.

You conceive that Individuals carrying on such a Trade would have Advantages over a Company in the Circumstance of Freight, and the other Objects alluded to?

Very great.

Do you see any Necessity for the very expensive Ships The East India Company equip for the Purpose of conducting their Trade?

By no means.

Do you see any Advantage resulting from the Employment of large Ships in preference to small ones?

Not now-a-days; there was a Time when it might be of Importance to this Country; but not in the present improved State of the World.

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Is there any Advantage, in respect of the Duties charged by the Chinese, between large and small Ships?

Yes, there has been found to be an Advantage pro tanto, but that is not sufficient to counterbalance the many Disadvantages.

You have stated that if the Trade to China were thrown open, British Manufactures might be forced into that Country; how can that take place to any Extent in the Face of Exactions which you say would be the necessary Consequence of the Removal of the Influence of The East India Company as a chartered Body?

I meant to say that that would take place at first on the opening of the Trade in consequence of the reckless Disposition of the Manufacturers and Merchants of this Country, when any new Market is opened, in sending their Goods without just Regard to whether they shall obtain profitable Returns or otherwise; but I cannot take upon myself to say when it might stop, in consequence of the Exactions of the Chinese, or of Losses on the Part of the English Speculators.

In your Opinion it would not be a permanent Increase of Trade?

Certainly not, if the Trade were to be opened without previous Negociation. The Chinese would commence with small Exactions, and they would go on encroaching every Year 'till they had destroyed the Trade altogether, and this would necessarily produce the Ruin of Thousands in this Country, I am confident.

The Witness is directed to withdraw.

Mr. Thomas Mills is called in, and examined as follows:

You are a Tea Dealer?

I am.

You are a Wholesale Dealer?

I am.

How long have you been engaged in the Trade?

Sixteen Years.

Have you regularly attended the Sales of The East India Company during that Time?

I have.

Did you attend the last Sale?

I did.

Did the Teas of the Company sell at the last Sale generally at Prices beyond those of the previous Sales?

They did.

Will you state generally the sort of Teas upon which the Advance has taken place beyond the preceding Sale?

The Boheas sold at an Advance of about Six per Cent. the low Congous Five per Cent. Twankays Four per Cent. and Hysons Ten per Cent.

Will you state what you consider to be the Causes of that Advance?

The Causes are generally considered to be the Reports in circulation respecting the Difference existing between the Company's Factory at Canton and the Chinese Authorities; also the known Inadequacy of the Company's Stock of some particular kinds of Teas, and the Uncertainty of further Arrivals.

Will you explain what you mean by the Inadequacy of the Company's Stock — in what respect you consider it inadequate?

In Boheas they have a Quantity equal only to about Two Sales, in Hysons they have not Two Sales, and in Souchongs and Pekoes they have none.

Did the Advance take place more particularly on those Teas in which you suppose them to have an inadequate Supply?

Yes; to the greatest Extent on the Boheas and the Hysons, of which they have not the same Stock as of other Teas.

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Is not the Company considered to be obliged, under the Act of Parliament, to keep a Stock equal to One Year's Consumption?

I believe it is considered to be the Requirement of the Charter, that they should have a Stock equal to the Average of Four Quarters Consumption.

You do not consider, however, that, in all Descriptions of Teas that are consumed in England, they have a Stock equal to the Average of Four Quarters?

Of those Four Sorts they obviously have not; of Souchongs there were none in the last Sale, and of another Description of Tea, the Pekoe, they have sold none since June 1828.

By what Classes of Persons are those Teas to which you have alluded consumed?

The Boheas are consumed by the lower Classes—the Manufacturing Classes; the Souchongs, the Pekoes and Hysons, by the higher Classes.

You consider the Supply to be more deficient in that Description of Tea which is most extensively consumed by the middling and lower Classes?

Yes.

Will you state generally what are the Varieties of Teas which are in regular Demand in England?

Of Black Teas there are Boheas, Congous, Campois, Souchongs, Pekoes, Padrae, Caper, Tetsong and Ancoy; and of Green Teas, Twankays, Hyson Skins, Hyson, Young Hyson, and Gunpowder.

Do the Company supply the Demand in all those Descriptions of Teas?

The greatest Variety is supplied by the Private Trade; the Company supply only a small Quantity in Varieties, though they supply the greatest Quantity in Bulk.

By the Private Trade, you mean to refer to the Trade of the Officers of the Company?

Yes.

Can you state whether the Varieties of Tea you have described, and for which a Demand exists here beyond the Supply of the Company, is to be obtained in other Parts of Europe?

I cannot speak to that Question generally; I have been Abroad Twice, and certainly the Pekoe Tea there is much finer than that imported here.

To what particular Part of the Continent do you refer when you say you have found it finer?

To Holland and Germany.

Is the Sale Price of Tea generally in advance upon the Upset Price at the Company's Sales?

In almost all Cases; occasionally Teas have not fetched the Upset Price; then they have been withdrawn at that Sale, and put up at the succeeding Sale without an Upset Price; but in most Cases the Selling Price is a very considerable Advance on the Upset Price.

Is there a great proportionable Difference sometimes between the Sale Price and the Upset Price in different Sorts of Tea?

Very considerable; Congou Tea put up at 1s. 8d. often fetches 2s. 5d., and other Congou Tea put up at 2s. 1d. has fetched 3s. 7d.

If the Upset Price is the Cost Price, how do you explain that great relative Difference between the Cost and Sale Price in different Kinds of Tea?

I should attribute it to the Inadequacy of Supply; the Selling Price would be nearer the Upset Price if the Supply was adequate to the Demand.

Do you conceive that the Extent of Demand for each Description of Tea can be pretty well presumed from the Experience of the Company's Sales, so as to enable their Agents to provide for it in proportion to the Demand?

The Company could declare a greater Quantity for Sale if they chose; the Quantity declared for Sale is perfectly optional with them; it is announced about Six Weeks previous to the Sale, and entirely depends upon their own Will and Pleasure.

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Can they have any Interest in not meeting the Demand in the same Proportion for each Description of Tea which exists, supposing they have been properly provided with Stock in China?

It is impossible for me to know the Reasons which induce the Company to regulate the Supply of Tea.

You conceive, however, that they have Reasons, independent of the State of their Stock as supplied from Canton, for increasing or diminishing the Quantity they expose to Sale?

Yes.

Do the Inspectors of the Company fix any particular Mark to the Tea?

Yes; the Company not only fix the Putting-up Price of their Teas, but they also fix the Quality of their Teas, and they sell them by Characters. These are the printed Characters of the Company by which they declare the Quality of their own Goods.

(Statement handed in.)

Do not they sell by Sample?

Yes; but they attach a Character to the Tea, declaring their Opinion of its Quality.

You, having taken a Sample, form your own Opinion of the Quality of the Tea?

Yes.

Is not a Break of Tea one of the Terms used in the Trade?

Yes.

Explain what that Term means?

A Break of Tea consists of a certain Number of Chests of the same Character and Quality, varying in Quantity from Two hundred to a Thousand Chests.

Do the Characters so affixed to each Break of Tea correspond with the Upset Price?

No, certainly not; the Characters are frequently lower for the 2s. 1d. than for the 1s. 8d. Teas.

The List of the Characters delivered in by the Witness is read, and is as follows:

TEA declared for Sale on Tuesday the 1st June 1830: Prompt the 27th August 1830.

EAST INDIA COMPANY'S CHARACTERS OF BLACK TEAS.

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(Mr. Mills.) This Paper contains a Comparison of the Character and Prices of some of the Teas sold at the June Sale, shewing that the Company's Upset Price did not correspond with the Company's Characters.

The same is delivered in, and read, and is as follows:

COMPARISON of the CHARACTERS and PRICES of different BREAKS of CONGOU, sold at June Sale 1830.

[686]

How do you explain that Difference?

The Upset Price is taken to be a remunerating Price, which consists of the Cost of the Teas in China, and the Expence of bringing them Home. It appears, therefore, obvious, that the Teas put up at 2s. 1d. must have cost the Company more in Canton than the Teas put at 1s. 8d.; but their Inspectors here declare that the Tea put up at 2s. 1d. is not so good as that put up at 1s. 8d.; there is therefore an obvious Difference of Opinion between their Inspectors in this Country and their Factory in Canton.

You conceive that the Factory of the Company at Canton do not habitually discriminate the Sale Price of the respective Qualities of Tea that they send to England?

The declared Opinion of their Inspectors in this Country is obviously at variance with the Opinion of the Factory at Canton. It is for every Person to judge by whom the more correct Opinion is formed.

According to your Opinion, which is the most correct?

I should rather state the Opinion of Purchasers collectively; and certainly the Opinions of the Trade in this Country would more agree, though they would in some respects differ, with the Inspectors here, than with the Opinion of the Factory Abroad, judging from the Prices at which the Teas sell; the Fact of some of the 2s. 1d. Teas not finding any Purchaser, and 1s. 8d. Teas selling as high as 2s. 5d., would argue against the Judgment of the Factory at Canton.

Is it not the Fact that Teas rejected at one Sale, and put up at a subsequent Sale, without any Price, have frequently fetched a higher Price than Teas put up at the same Sale at the Price at which they were originally put up at the previous Sale?

If Prices have generally advanced, Teas which were rejected at 2s. 1d. at a former Sale, and which would have found Customers at 2s. 0½d., if the Prices have advanced from the Company diminishing the Quantity, would fetch the Prices at which they were rejected on a former Sale.

What are the Descriptions of Tea for which you conceive there might possibly be an increased Demand in England, were the Supply adequate?

I should say generally that the Consumption of Tea might be materially increased. I do not myself see why the Consumption of Tea should not keep pace with the Consumption of Coffee. The Consumption of Coffee, since 1824, has increased above 130 per Cent.; the Consumption of Tea within that Time has increased only 26 per Cent.

What is the particular Quality of Tea in which you conceive there is the greatest Opening for an increased Consumption?

I should think the lowest Teas and the finest Teas are the Two Descriptions of Tea of which the greatest Increase in Quantity might be sold; but I think generally the Consumption of Tea might be greatly increased if the Supply was increased.

Have you seen the Return from the East India House, in which the Average Prime Cost of Tea at Canton is stated for the last Six Years?

Yes, I have.

Have you compared that with the Price at which the Company have sold those Teas?

I have.

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What is the general Inference you have drawn as to the Profit of the Company from those Sales upon that Comparison?

I compared the Average Cost Price at Canton in 1828-29 with the Sale Prices of the last Sale; probably some of the identical Teas purchased in 1828-29 were then sold. On the Bohea the Advance upon the lowest was Ninety-two per Cent., and upon the highest One hundred and forty per Cent.; on the lowest Congou, put up at 1s. 8d., the Advance was Seventy-five per Cent., and the highest Ninety-nine per Cent., and on Congous put up at 2s. 1d. the Advance upon the lowest was Seventy-eight per Cent., and upon the highest One hundred and ninety-five per Cent.; on Twankay put up at 2s. 2d. the Advance on the lowest was Sixtysix per Cent., and on the highest One hundred and fifty-three per Cent.; and on Hysons put up at 3s. to 3s. 9d. the Advance on the lowest was Seventy-nine per Cent., and on the highest One hundred and forty-one per Cent.

The Witness delivers in the Statement, which is read, and is as follows:

STATEMENT of ADVANCE on TEAS sold at the JUNE SALE 1830 above the Average Cost Prices of 1828-29 at Canton, as stated in Returns made by The East India Company, dated 17th March 1830.

Can you, from that Statement, draw an Inference as to the Net Profit of the Company here upon the whole Sale?

I have made a Calculation of the Advance on Teas, sold at The East India Company's Sale in Season 1830, above the Putting-up Price.

What Notice have you taken in that Paper of Teas rejected at former Sale brought in again?

There were no rejected Congous put up at the last Sale; there were a few Twankays, which I have omitted; they sold, in consequence of the Deficiency of Supply, at a considerable Advance.

The Paper is delivered in, and is read as follows:

CALCULATION of the ADVANCE on TEAS, sold at The EAST INDIA COMPANY'S SALE in June 1830, above the Putting-up Price.

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Have you any Means of knowing what the Advance per Cent. is in the Price of Teas sold by the Americans in the United States and on the Continent of Europe beyond the original Price of those Teas at Canton?

No, I have not.

The Net Profit then, that we are to infer the Company derive from their Sale in June 1830, to which your Calculation refers, was £122,177 18s. 1d.?

Yes; that is the Calculation of the Profit above the Putting-up Price.

Are you of Opinion that the Profit is less or greater than in the corresponding Sales of the preceding Year?

I should hardly venture to give an Opinion upon that, for the Prices of Teas vary greatly; Tea is lower than it used to be, though it has declined in Value much less than many other Articles of Consumption.

Are you aware of any Reason why that Sale should have differed particularly from other Sales?

Yes. I think that the Report in Circulation, and the Inadequacy of the Stock, had an Effect.

Will you state whether those Descriptions of Teas which you have represented to be furnished exclusively by Private Traders, under the Sanction of the Company, are to be obtained as regularly as the Company's Teas?

The Ships from Canton arrive only once in the Year, and the Private Trade always sell their Teas at the ensuing Sale after their Arrival; the Sale of those Teas, therefore, generally takes place in June; but some of the Ships arrive late, and then the Sale of the Remainder of that Private Trade takes place in September; but the Supply of that Description of Tea must always be purchased at those Two Sales for the rest of the Year.

The Supply cannot be so regularly depended upon of that Description of Teas as the Supply of those Teas furnished by the Company?

No. I will beg to state the Description of Teas for which we depend entirely on the Supply of the Private Trade; the Company do sometimes import Souchong and Pekoe, but they have now none to sell. The other Sorts are Padree, Caper, Tetsong and Ancoy, of Black Teas; and Young Hyson and Gunpowder, of Green Teas; those are among the finest Description of Hyson sold.

Are they of a finer Quality than any imported by the Company?

Certainly. They have only once in my Time imported Young Hyson, and once Gunpowder; the Gunpowder fetches a higher Price than any of the Company's Teas.

Can you state what are the Rates charged by the Company for disposing of Teas imported by private Individuals?

They charge their own Officers an ad-valorem Duty of about Twenty-six per Cent. As they are sold at the East India House, of Course the Company know the Price they obtain, and they take off a Sum amounting to Twenty-Six per Cent.

Are those Rates greater or less than they charge for other Goods?

They are very different.

Can you state the Difference?

On Silk, which is, upon the Average, Threefold the Value of Teas, they charge only One and a Half per Cent.; and on Spices, which are about the same Value as Tea, they charge only One and a Quarter. This is their own printed Schedule of Rates to which I am referring.

The same is delivered in, and is read as follows:

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SCHEDULE of RATES to be charged by The East India Company for the Management and Sale of Goods imported by Private Merchants.

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Articles not enumerated will be charged according to their Value and Bulk.

These Rates are calculated on the usual Packages in which Goods have hitherto been imported. Proportionable Rates will be charged for any other kinds of Packages.

If Goods require to be garbled, or to have new Packages, a reasonable Price will be charged for the same.

A Charge of One Quarter per Cent. on the gross Value of all Goods sold at the Company's Sales, and of One Eighth per Cent. on all Goods delivered by Valuation or Private Bargain, will be made to the Proprietors, in addition to the above Per-centages respectively.

The usual petty Fee of Lot or Loading Money will be paid to the Warehousekeepers by the Parties who may take the Goods away.

East India House, 4th October 1826.

Are you aware of any Reason why they should make so great a Difference in the Charge upon different Descriptions of Commodities?

My Opinion is, that they make this Charge on Teas to prevent the Competition of their own Servants.

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You infer that they apprehend that Competition more in the Case of Tea than of other Commodities?

Certainly.

Do they take into Consideration, in making that Charge, the Circumstance of their Officers bringing Home their Teas free from Freight?

No. In the Agreement the Company make with their Officers, a certain Quantity of Tonnage is allowed them, and in that Tonnage the Officers bring Home either Teas, Silk or Mother of Pearl Shells, or any thing they please, or they even sell it sometimes. These are the Papers in which their Charges are stated; they charge Twelve per Cent. on one Account, and Sixteen per Cent. on another Account, averaging together Twenty-six per Cent.

Do the Purchasers of Tea meet with the same Facilities of Accommodation from the Company as the Purchasers of other Goods?

No, I certainly think not; the few Sales that occur in the Course of the Year are a great Inconvenience to the Trade. In every other Article in which there is such a large Consumption, the Sales occur daily and weekly, such as Sugar and Coffee and Groceries; and whenever the Trade has had an Occasion to make any Application to the Company, they have been disinclined to comply with it. They make a Charge for Lot Money, which is much greater than is made by other Importers; they charge 3d. a Chest for lotting Teas, and that produces about £6,000 a Year to the Company; the lotting of the Teas is done for their own Convenience; and on many Occasions the Trade have applied to the Company for its Remission, but without Success.

Are you of opinion that the opening of the Trade from Canton, and doing away with the Monopoly of the Company, would be favourable or injurious to your Interests as a Tea Dealer?

The Brokers, who at present have a Brokerage upon the whole of the Teas imported, wish generally the Trade to be confined to this Port. The Dealers, I think, are divided in Opinion; all of them would wish the Trade thrown open if the Imports could be confined to the Port of London. My own Opinion is, that it would be more for my personal Interest if the Trade was thrown open.

Would it not be clearly for the personal Interest of the Tea Dealers in other Parts of the Country than London?

Decidedly. The Objection felt by any Portion of the Trade here is, that Tea Dealers in other Parts of the Country would be benefited at their Expence.

Have you any doubt that there would be a greatly increased Consumption of Tea, supposing the Trade were thrown open generally?

I have no doubt at all of it.

Do you think that Teas of inferior Quality would be obtained at a cheaper Rate?

I have no positive Facts on which to form that Opinion; but the Calculation of the Company's Profit leads to such an Inference.

Have you any doubt Tea might be imported at a much cheaper Rate by private Merchants?

I have no doubt of that; for the private Merchant would be content with a small Portion of the Company's Profits.

Do you supply any Persons in Ireland with Tea?

No.

You are not aware of the State of Consumption of Tea in Ireland?

No. I am aware there are Houses in London who purchase it for the Consumption of Ireland, and that a very considerable Quantity is purchased for Ireland.

You have no Means of judging whether a more or less increased Consumption would take place in Ireland in consequence of opening the Trade?

I think the Consumption of Tea would be generally increased if the Quantity was increased.

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Can you state the Difference between the Wholesale and Retail Price of the different Qualities of Teas?

No; that is quite uncertain. In Towns where there is a great Competition the Retailer is satisfied with a much less Profit than he would be in Cases where there was no Competition.

In London what is the Per-centage?

I do not know; I am not a Retailer, and I supply no London Retail Dealer.

Whom do you supply?

We supply Country Grocers — the Retail Grocers.

What is the highest Price you pay for any Tea you buy?

We buy all Varieties, from 1s. 6d. to 5s. 3d.

Is 5s. 3d. the highest Price you have given for Teas of late Years?

No; occasionally a very small Quantity may have sold at a higher Price.

Do you transact all your Business through Brokers?

We attend the Sale Room when the Teas are put up, and nod to a Broker, who makes the Bidding.

You bid through him, upon your own Judgment; you do not trust to his Judgment?

Of course we act upon our own Judgment.

What is the Commission paid to the Broker?

An Half per Cent.

Are there many Wholesale Tea Dealers in London?

Yes, there is a considerable Number.

The Trade is not confined to a small Number of Persons?

No. I cannot give a Guess as to the Number, but I should say there may be Three or Four hundred.

To what Circumstance do you attribute the Reduction which has taken place in the Price of Tea of late Years?

To the increased Quantity declared by the Company for Sale.

Do you not apprehend that the increased Consumption of Coffee has had a considerable Effect in reducing the Price of Tea; that it has been used by the lower Orders as a Substitute?

Certainly.

Do you apprehend that the increased Consumption of Coffee will be progressive at the present relative Duties on Tea and Coffee?

I can hardly give an Opinion; the Consumption of Coffee continues to increase every Year; and I see no Reason why the Consumption of Tea should not increase in the same Ratio.

If Coffee increases in the same Ratio, will it not displace so much Tea in the general Consumption of the Country?

The Population of the Country is increasing; if the Price of Coffee was to decline, I think that would be very unfavourable to the Consumption of Tea.

How much per Cent. is the Price of Coffee increased by the Duty?

The Duty is Sixpence a Pound.

What Increase is that upon the Price?

Coffee sells at all Prices; it is impossible to tell; Coffees are bought as low as 30s. per Cwt.; the Duty is 56s. per Cwt.

What is the highest Price?

Mocha Coffee sells for Six Guineas; the Duty upon that is Nine-pence per lb., and on all East India Coffee.

Can you say what is the Average Increase in Price per Cent. on Coffee in consequence of the Duty?

No, I cannot.

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Of that Quality, what is most usually consumed?

There is such a Variety of Coffee; I have bought Coffee at 38s., and Coffee at £6.

What is the Rate of Duty per Cent. on Coffee of the highest Price?

It would be nearly One hundred per Cent. on the Cost of Mocha; £6 is a very high Price.

The highest Price you have given for Hyson Tea is 5s. 3d.?

That was the highest Price at the last Sale; it has fetched more.

What is the highest Price you have given for Black Tea?

There is a very small Quantity of fine Tea brought over by the Private Trade, and which comes over as Presents.

The Question refers to that brought over by the Company?

Souchongs have sold at 4s. 9d.

On what kinds of Tea has the Price fallen most?

I cannot give an Opinion.

How do you explain the Circumstance of so large a Quantity as Fifteen or Sixteen hundred thousand Pounds of Tea being refused by the Trade at an Advance on the Upset Price, and yet there having been a great Increase on the Upset Price on the Quantities sold?

Because that Tea refused and put up at 2s. 1d. was not worth the Price at which it was put up; other Tea put up at 1s. 8d. has fetched 2s. 5d.

You attribute its Rejection to its not being of the Value at which it was put up?

Undoubtedly; it would have been bought at any Sale at which it was rejected at very near 2s. 1d. or at 2s. 0½d.

Are you not aware that some of that Tea, which had been rejected as not being worth an Advance on the Upset Price, has been sold at the next Sale at a higher Price than that at which it had been offered at the previous Sale?

Not unless there was an Advance in the Price of Teas of the same Quality; generally the Variation would not, in the Opinion of Dealers, shew the Value of Tea, for the Reasons I have already stated.

The Company have no Controul over the Quantity put up by their Officers?

They know what that Quantity will be, and they limit their own Supply accordingly. They make up the Quantity over and above the Quantity sold by their Officers.

As the Quantity of Tea rejected by the Public has increased very much of late Years, do you apprehend that the Quality of the Tea put up by the Company has been inferior, and that the Upset Price has been higher, in proportion to the Value of the Tea, than it used to be?

I should say there was, in every Sale, a greater Quantity than there used to be of what we call a fresh new Tea. The Teas are not so strong as they used to be.

What do you mean by a fresh Tea?

Those Terms are used in the Company's Character; it is a weaker Tea; not a strong coarse Tea.

It does not mean that it is a young Tea?

No.

Is that Tea, called fresh new Tea, generally inferior in Value to the Price at which it is put up?

Not necessarily, because there are fresh new Teas put up both at 1s. 8d. and 2s. 1d.

Is it Tea of that Description which has been usually rejected?

Yes, frequently.

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Are you aware what the Decrease of Price had been, previous to the last Sale, within the last Six Years?

No, I have not made a Calculation.

Have you estimated the Net Profit, in the Manner in which you have estimated it for the last Sale, in any previous Year?

No, I have not.

Are you aware whether the Net Profit on the last Sale was greater or less than in June 1826, for instance?

No, I am not.

The Witness is directed to withdraw.

Ordered, That this Committee be adjourned to Tuesday next, One o'Clock.