is the proper figure, which would include the older types of ships and also fairly represent the present figures of ships that are undergoing construction. It is to be understood that these figures are based upon regular lines constructed to carry general merchandise and not tramps. Tramps usually have a single deck and hold and are suitable for carrying full cargoes of a single kind or full cargoes of materials which will not crush, such as lumber and wheat, pig iron and cotton, etc. General merchandise can not be carried in these deep ships, as the packages will crush, and any figures which are based upon general merchandise cargo ships will favor the tramp ship of a single hold and one deck or hold and "between decks." His relative carrying capacity is larger, because having either one hold or at most one intermediate deck, the actual space taken up by the decks themselves is taken into its gross and net tonnage, so the fewer decks, relatively the more space. Based upon this percentage of 64, the equivalent rates are as follows: and these relations put in tabular form showing a corresponding rate, assuming that each of the rates is $1, are as below: You will note that the rate of $1 per net register ton is a reduction of 31.8 per cent from the Suez rate. In my opinion this reduction is greater than necessary to put the Panama Canal on a competing basis with that part of Asia which includes Yokohama, Hongkong, and Manila and its continental hinterland. I propose rates for the Panama Canal on the following basis. We know from actual experience here what rate will begin to draw traffic from San Francisco to New York, and that rate is $8 a ship's ton, shot or feathers. I figure that 6 per cent of this rate, or 48 cents per ship's ton of 40 cubic feet, would not be excessive. The corresponding rates for tonnages would be as follows: Gross register Net register Suez net‒‒‒ $0.805 1.258 1. 121 This is a reduction of 14.2 per cent, exactly one-seventh of the Suez rate. instead of a reduction of 31.8 per cent, which corresponds to a rate of $1 per net register ton. I think that this rate is ample to put the Panama Canal in competition with the Suez Canal as a carrier for the Yokohama, Hongkong, and Manila territory, and is more than ample as a competitor with the Tehuantepec route. I do not think it is appreciated generally that for the territory lying east of Colombo there is very strong competition between the Cape of Good Hope and the Suez Canal. We can never hope to go as far west as Colombo, nor in my opinion as far west as French Indo-China. We would be a strong competitor of the Suez Canal at Suez rates for the Australian and New Zealand business, as we have the advantage of distance. Consequently, the only rate which should be carefully investigated is the rate for the Yokohama, Hongkong, and Manila territory. There is another very important point in fixing the rate for this Yokohama, Hongkong, and Manila territory, and it is a point which has not yet been considered. This is the fact that the Panama Canal will place the southern part of the United States and our own Atlantic seaboard in close competition with this territory for the articles of which they are the largest importers, such as cheap cottons, raw cotton, iron and steel manufactures, machinery, steel billets, etc. The largest part of the goods which China and Japan manufacture at the present time we take generally overland by way of San Francisco, and I think it can be shown that the above rate of 48 cents will draw Philippine hemp and Philippine sugar through the canal here. I bring these points in relation to competition to your notice now, and I shall treat them more in detail in the near future. Very respectfully, EUGENE T. WILSON, N. B.-The present Suez rate for cargo ships of about 56 cents a ship's ton would correspond to 7 per cent of the through rate of $8. The rate proposed of 48 cents per ship's ton is 6 per cent. Chairman and Chief Engineer, Culebra, Canal Zone. SIR: I inclose herewith British parliamentary paper, commercial No. 7 (1874), giving the final conclusions of the Constantinople convention on Suez Canal tonnage. So far as I know this is the only part of the original proceedings that have been translated into English. I inclose also copy of the Suez Canal regulations, edition of January, 1911, and a British Board of Trade blank for the Suez Canal special tonnage certificate. The regulations for the canal you may keep, and although eventually I should like to have the others back, they are at your disposal for such time as you want them. In comparing the Suez rules issued by the canal company with the proceedings of the Constantinople convention, you will note that the rules contain the general principles, which begin on page 16 of the convention proceedings, omitting Rule I as contained in the convention proceedings. This Rule I, beginning with the word "rule," is taken verbatim from the British merchants' shipping act of 1854, which is the Moorson system of measurement for determining gross tonnage. With very slight changes in wording it is identical in principle with our own measurement act of March 2, 1895, and Revised Statutes, section 4153. You will note at the bottom of page 17 that a greater number of divisions is not prohibited, so long as they are an even number," for the same class of ships. Our act makes a greater number of divisions obligatory. Although Rule I is not printed, it is used. 66 I suggest that you have the Suez Canal tonnage certificate photographed and thus we will be able to get more copies of it if necessary. Very sincerely, EXHIBIT G. EUGENE T. WILSON. Col. GEORGE W. GOETHALS, ISTHMIAN CANAL COMMISSION, CANAL Zone, Chairman and Chief Engineer, Culebra, Canal Zone. SIR: I send you herewith memorandum of the present cost of Cardiff coal at various ports of the world. The figures, of course, are only approximate, but they are close. They are as of the date of November 22 from circular of Messrs. Hull, Blyth & Co., No. 1 Lloyds Lane, London, and also Cardiff. There has been an advance in coal itself of about 6 cents per ton since the 1st of January, and the freights have advanced very materially in the last 12 months. This has been due to two reasons: First, the wages of all British ships have been very materially increased since the strike last summer; second, there is a very great demand for shipping all over the world. This demand is due to several reasons: First, the enormous crop of cotton in the United States which requires moving, a large crop of inferior wheat in Canada, due to the excessive rains and the late fall, which has to be got rid of pretty soon. Due to general drought conditions all over Europe and the United States, the sources of supply have been materially changed. There is a famine in Burma, which has sent rice skyward, and Java has prohibited the exportation of rice. These factors, together with shortage of German beet sugar, which has turned out even lower than estimates, have materially changed the sources of supply for Europe and, consequently, have made a heavy demand for ocean shipping. Freights on coal to Colombo even via the Suez Canal, which were about 10/3 in March, are now, as you see, 13/. Cardiff coal is out of the running farther east than Singapore and is but little used east of Singapore except for warships. The competition of other coals with Cardiff is very stiff at Colombo. I quote below the comparative rates last March at Colombo and Singapore, Hongkong and Yokohama: These prices are for coal in ship's bunkers at the various places. Very respectfully, EUGENE T. WILSON. Memorandum of cost of No. 1 Cardiff coal at various ports. [17/ per ton less 24 per cent í. o. b. Wales, equals 16/7 at current rate of exchange, $4.06. Bear SIR: Herewith extract from the Journal of Commerce of December 6. ing in mind that the rate in 1910 was 7.75 francs and in 1911 7.25, it seems quite a large increase in tonnage. The rates were cut about 7 per cent, the tonnage has increased 18 per cent, and the revenue one-half of 1 per cent. Very respectfully, EUGENE T. WILSON. [From The Journal of Commerce, Dec. 6, 1911.] SUEZ CANAL TRAFFIC. RETURNS FOR THE MONTH OF SEPTEMBER, WITH COMPARISONS. The traffic through the Suez Canal for the month of September last, as compared with returns for the same month of 1910, was as follows: Col. GEORGE W. GOETHALS, ISTHMIAN CANAL COMMISSION, CANAL ZONE, Chairman and Chief Engineer, Culebra, Canal Zone. SIR: With reference to previous letters to you on the subject of ship measurement: The British merchants shipping act provided that when the King in council shall be satisfied that foreign countries measure their tonnage essentially in the |