the important fact that the Shan-hai-kwan Railway did not penetrate sufficiently north to reach some producing centres of Western Manchuria, while the waters of the Liao were navigable only 200 miles from the mouth, and were, together with the harbor itself, ice-bound from November till March. Dalny was nearly ice-free, and the Manchurian Railway was available through all seasons. The only competitors of the railroad would seem to be the small bean-carrying junks plying down the Liao, which were both owned and loaded by the same Chinese merchants. This competition the Russians met by greatly reduced freight rates of the railway, which made it possible for every 100 poods of Manchurian grain and beans to be carried 600 miles between Harbin and Dalny for about fifty-seven cents gold, or $10 per ton.[76] From Dalny, heavily subsidized Russian boats transported Manchurian exports to Japan at a freight rate which, in conjunction with railway rates, amounted to the saving by the shipper of 4.50 _yen_ per ton, as compared with the railway-rates _plus_ the freight-rates of non-Russian vessels.[77] When the flour industry of the Russian towns in Manchuria is developed, Russian steamers may be seen carrying flour from Dalny, not only to Japan, but to Chinese and Eastern Siberian ports. As for the import trade of Manchuria, the Russians, who have ousted American importers of kerosene oil at Vladivostok, seem to be now by energetic methods slowly driving away the same rivals from Chemulpo and from Dalny.[78] Vastly more important as articles for importation than kerosene oil are cotton yarn and textiles, which are annually supplied from abroad to the value of over 12,000,000 _taels_. By far the greater part of sheetings, drills, and jeans comes from America. The Russians were not unable to produce cotton fabrics almost as good as the American goods, but the trans-Siberian freight was twice as expensive as the Pacific transportation, and could not be expected to be further reduced without great difficulty.[79] It was not impossible to suppose that the Russian Government might ultimately apply to Manchuria the system of granting a premium and an additional drawback on textiles made from imported cotton, which had been in successful operation in Persia. There was no question but that, together with the development of Manchuria under Russian control, foreigners would lose most of their import trade in lumber, butter, and flour, and here again the Russian success must depend on the exclusiveness of their policy.[80] Mr. H. B. Miller, the United States Consul at Niu-chwang, seems to have made a delicate reference to this point when he said, in his report dated December 5, 1903: “The United States trade in Manchuria with the Chinese amounted to several millions of dollars per year, and was almost entirely imports. It had grown very fast, and would have had an extended and most substantial increase without the Russian development, for the country