The Liverpool Cotton Market and Cotton Re-exports, c. 1815–1914

Abstract

The Liverpool cotton market emerged as the largest supplier of raw cotton to the British spinning industry at the beginning of the nineteenth century. However, the large stocks of cotton held in Liverpool induced some Continental spinners to buy in Liverpool. There was a major 'take off' of re-exports when the British duty on raw cotton was abolished in 1845. At first, Germany, Holland, Russia and Belgium were the major destinations for re-exports. Over time this changed so that around 1900 Russia, the United States and Belgium were the major destinations; Russia was particularly important. Cotton re-exports from Liverpool peaked in the 1860s during the American Civil War. After this, more direct trade between cotton-growing countries and Continental markets developed. Despite this, Liverpool was still supplying some Continental firms with cotton up to the outbreak of the First World War. The re-exportation of cotton may have been harmful to the British spinning industry during the American Civil War, when Continental demand helped deplete Liverpool stocks. Some harm may have been done when the Liverpool cotton market was 'cornered' — the demand of Continental spinners may have helped to reduce the amount of cotton in Liverpool, so making cornering easier.