they desire. The actual
selling is done by competitive cash bidding, the highest bidder becoming
the owner. Two classes of brokers do the bidding, one for home trade and
the other for exporters.

Home trade takes about a tenth of the coffee, the remainder being sold
for export. If the coffee is bought for re-export, it can be transferred
to the shipping port, still in bond, and shipped out of the country
without paying duty. During the World War, auctions were held about
twice a week; but after the signing of the armistice in November 1918,
the London traders resumed the four times a week practise.

[Illustration: COFFEE AUCTION SAMPLES ON DISPLAY AT AMSTERDAM]

[Illustration: GREEN COFFEE STORED ON THE DOCKS AT HAVRE, FRANCE]

[Illustration: HANDLING GREEN COFFEE AT TWO EUROPEAN PORTS]

_Coffee Exchanges and Trading Methods_

Green-coffee buyers in the large importing centers of the United States
and Europe recognize two distinct markets in their operations. One of
these is called the "spot" market; because the importers, brokers,
jobbers, and roasters trading there deal in actual coffee in warehouses
in the consuming country. In New York the spot market is located in the
district of lower Wall Street, which includes a block or two each side
on Front and Water Streets. Here, coffee importers, coffee roasters,
coffee dealers, and coffee brokers conduct their "street" sales.

The other market is designated as the "futures" market; and the trading
is not concerned with actual coffee, but with the purchase or sale of
contracts for future delivery of coffee that may still be on the trees
in the producing country. Futures, or "options" as they are frequently
called, are dealt in only on a coffee exchange. The principal exchanges
are in New York, Havre, and Hamburg. New Orleans and San Francisco
exchange dealers trade on their local boards of trade.

Coffee-exchange contracts are dealt in just like stocks and bonds. They
are settled by the payment of the difference, or "margin"; and the
option of delivering actual coffee is seldom exercised. Generally, the
operations are either in the nature of ordinary speculation on margin or
for the legitimate purpose of effecting "hedges" against holdings or
short sales of actual coffees.

The New York Coffee and Sugar Exchange--the most important in the world,
because of the volume of its business--deals in all coffees from North,
South, and Central America, the West Indies a