224 REPORT ON COOPERATION IN AMERICAN EXPORT TRADE.
CHINA, MANCHURIA.
Spoital seaport of Consul General P., S. Heintzleman, Mukden, China, October
, .

There are no syndicates or combinations of Chinese manufacturers
in Manchuria engaged in either the export or the domestic trade.
Manchuria is primarily an agricultural country, and up to the
present there has been little or no manufacturing.
Several combinations of Japanese manufacturers and exporters of
cotton goods operating in Manchuria call for special report—the
Japanese Cotton Fabric Export Syndicate and the Manchurian Cotton
 Exporters’ Association.
In June, 1906, a Japanese syndicate called the Cotton Fabric
Export Syndicate was formed by the Osaka, Mie, Kenshi, and
Temma spinning and weaving companies for the purpose of extending
 the market of cotton goods in Manchuria. The Mitsui Bussan
Kaisha, Japan’s largest commercial concern in Manchuria and the
principal distributors of Japanese piece goods, was appointed selling
agent of the syndicate.
The Japanese Government agreed to arrange for the syndicate to
obtain money at easy rates as an exchange fund for the export of
zoods. The Yokohama Specie Bank was instructed by the ore
ment to accept four months’ sight drafts at the rate of 4 per cent
on a total amount exceeding 5,000,000 yen per annum and 4} per
cent on an amount under 5,000,000 yen per annum. Furthermore, in
consideration of the constant fluctuation in the rate of exchange and
the financial conditions in Manchuria, it was arranged in December,
1906, that from that date the money drawn on drafts of the syndicate
should be repaid in Japan. Moreover, the syndicate, with the assistance
 of the Mitsui Bussan Kaisha, made an arrangement with the
two leading Japanese steamship lines to China, the Nippon Yusen
Kaisha and the Osaka Shosen Kaisha, for the latter to carry cotton
goods at the specially low rate of 45 sen per bale between Osaka and
Dairen. The South Se, Railway Co, a semigovernment institution,
 with an authorized capital of 200,000,000 yen, operating the
Japanese railways in South Manchuria and conducting as adjuncts
many other enterprises, was also approached for the purpose of
obtaining a reduction in freight for the syndicate goods, but the
egy was not in a position then to allow a discount, as its system
was still undeveloped.
Steps were taken to insure the uniformity of the quality and packing
 of the syndicate goods. The members of the syndicate carefully
examine each other’s goods every month. From 24 to 30 bales of
cotton cloth gh in each mill are picked out at random, and the
quality carefully examined in respect to weight, width, length,
border, etc. In addition to this examination one bale of every quality
of goods produced by each mill is brought to one company’s mill in
turn, and an examination is conducted by the chief experts of that
mill. This arrangement was put into practice from October, 1906.
The manufacturers’ syndicate, however, did not prosper. The sale
of cotton goods on consignment or through branches abroad, which
plan was also attempted, did not pay as it was felt it should, so
that both methods were in time practically discontinued. As a consequence
 manufacturers, as a rule, do not now try to export, and