[Letter from A. H. Blackshear, Jr. to I. H. Kempner, April 27, 1954] Page: 1 of 4
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April 27, 1954
TO: I. H. Kempner
FROM: A. H. Blackshear, Jr.
With reference to the attached letter from Harris, dated April 21st
regarding the second paragraph having reference to Marubeni, the barter and escrow
transactions entail a considerable amount of work.
If Harris sells Marubeni cotton for February delivery the cotton is put
under order sometimes before letters of credit are received. After the cotton is
down on the dock covering say 200 bales we may receive a credit for 15 bales, 10
bales, or 25 bales and sometimes it is necessary to have the ladings cancelled at
least three times. Of course, this is part of the office work, but it certainly
makes it difficult from a finance standpoint to sell cotton under these terms and
not know when you are going to expect payment of your invoices.
I know that one particular invoice that was sold under barter transaction -
that we were over six months in obtaining payment for said invoice.
I do not believe that we should write Lacerda about the unpaid invoices,
or any discrepancies in their account, as Marubeni can advise us direct the status of
the invoices and accounts and when they will be paid, sending Lacerda copies of our
letters.
We wrote Marubeni about the unpaid invoices, sending Lacerda a carbon copy
of said letter. Marubeni replied to our letter of Aprili2th, which was received in
today's mail, furnishing us with the dates as to when we may expect payment of the
escrow invoices, which consisted of eight different invoices. He advised that one
invoice was set up for payment on April 2nd and as of this date we have not received
payment. The remaining invoices he advised he was checking into the matter and would
advise us the status of these invoices by the next mail, therefore, I fail to see where
Lacerda could obtain this information any quicker than our letter to Marubeni.
I do not believe that we should make any advances to anyone, either a
Mexican concern, or an American, unless the advances are amply secured. If we had
made advances during the years 1952 and 1953, like other cotton concerns, we would be
in the same position as they are today, carrying a number of Mexican loans that cannot
be collected.
It has been my contention that whether or not you make a loan, you can
purchase the cotton if your basis is in line, or just a little better than your
competitors. We purchased the past season several thousand bales of cotton from Esteve.
We did not make them a single advance and I am confident that we can purchase Mexican
cotton, provided our basis is in line with our competitors. If we had to pay 5 points
more than our competitors and purchased 200,000 bales, it would only cost us 450,000.0O
and I don't believe that you could make advances on 200,000 bales without suffering a
severe loss.
As of Saturday night we had a total stock in outside presses of 11,L470 bales.
38% of this stock could not be used by us as collateral, as the cotton was delivered-
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Blackshear, A. H., Jr. [Letter from A. H. Blackshear, Jr. to I. H. Kempner, April 27, 1954], letter, April 27, 1954; (https://texashistory.unt.edu/ark:/67531/metapth1502468/m1/1/: accessed July 16, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu; crediting Rosenberg Library.