Italy’s silk and cotton trade

«The Economist», 26 febbraio 1910, p. 438

The Ministry of Finances, through the Board superintended by that competent statistician, Signor Luciolli, has recently issued the provisional return of Italy’s foreign trade in 1909; values are calculated on the basis of 1908. The general results are as follows:

As compared with those of 1908 these figures show an increase in imports of 165 million lire, and in exports of 104 millions. If we take 1907 as term of comparison, there has been an increase in imports of 198 millions, but exports have sunk by 115 millions. Of the excess of imports in 1909, 149 millions are due to wheat, flour, and other vegetable foodstuffs, which is a very strong argument against agricultural Protection (wheat-growing since 1894 is protected by a duty of lire 7.50 per 100 kilogs). Nor is industrial Protection, to which Italian agriculture has been long sacrificed, more supported by the moderate increase in exports, inasmuch the two Italian staple industries – silk and cotton – are not yet out of the trials of a long and severe crisis.

As for silk, which in its principal branches of reeling and twisting, is a quite non-protected industry, exporting the large mass of its manufactures, it is hoped that a better period may ensue beginning with the new crop of cocoons, which will take place in next June. The last crop proved abnormally bad, because later frosts in May, 1909, had seriously endangered the vegetation of the mulberry trees in North Italy, and especially in Piedmont, where farmers were obliged to reduce by almost a half their customary rearing of silkworms. In consequence of the resulting scarcity in the home crop of cocoons the Italian silk reelers were induced, for fear of being later unable to work their filatures, to indulge not a litte in their natural speculative buoyancy and to deal with too dear raw materials. Events proved that fear was utterly ungrounded, as the want in the home crop was soon set off by larger imports of foreign cocoons, particularly from the Levant. On the other side, the exceptionally abundant silk produce of Japan in this year and the delay of the American consumers in resuming their purchases of raw silk at Milan, have maintained all this season a very dull tone in the market, in spite of the fact that work in the silk weaving industry at Lyons and other European centres has been unusually active. Raw silk and manufactures thereof exported from Italy in 1909 amounted to lire 566,612,000, or fully 30 per cent, of our total exports, showing an increase of lire 38,346,000 over 1908. Silk imported in 1909, the bulk of which is in cocoons and in raw silk to be twisted and thrown in Italian mills, represents a total value of lire 222,029,000, or lire 27,124,000 more than in 1908.

The case of cotton industry is a far worse one. This industry, as is well known, has been much developed since 1887 by the artificial inducements of Protection. The early years of high tariffs were a source of splendid profits to the existing concerns; but afterwards the general enlarging of the plants and the starting off of new and big enterprises have carried the normal output of the national cotton factories far above the actual possibilities of home consumption. This consideration must not be overlooked in meeting the usual Protectionist boast grounded on the increased exports of cotton yarn and cloth. The fact is undeniable, but it took place at the exclusive expense of the poor Italian consumers, who are heavily taxed in order that the happier Levantine or South American consumers may purchase cheaply the surplus produce of the Italian protected cotton factories. The figures for 1908 and 1909 are as follows:

I propose to examine in a subsequent article some other features of the Italian foreign trade.