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HEYDAY

The United States, Opium, and the China Trade

by Morgan Greene

The China Trade became the focus of many seaports throughout the nineteenth century, with a high American demand for Chinese porcelain, silks, and of course, teas. Ship owners, captains, and crews began to battle over whose ship could make the trip between Northeast and Canton in the shortest amount of time. With each journey, the owners made a tremendous amount of profit, and often a ship owner’s initial investment was made back with only one successful Canton voyage. A direct trade route between the United States and China was established as early as 1784, when the Empress of China traveled from New York to Macao, and from here American merchants’ interests in China only increased. 1 However, the demand for American goods in China was nowhere near as high as the demand for Chinese goods in America. Trade with China would have collapsed if American merchants had not began to work in the opium trade, as it both enabled commerce between the West and China to be mutually beneficial. In addition, the Opium Wars allowed the Americans, whose country chose to remain neutral, to take up where the British left off while they were tied up in war with China.

Both England and America had difficulties finding goods that were in enough demand in China to make the trade equal and profitable. In the late 18th century British merchants found that the solution to this problem was importing opium from India. With the British conquest of India, the British East India Company was able to keep the Indian opium market closed from any non-British merchants for the early 1800s. The American merchants, seeing the success of opium sales, began to import the drug from Turkey to get around the British monopoly. Though profitable, the Turkish opium never brought about the same volume of success that the British merchants were experiencing with the higher quality, Indian drug. When, in 1838, the British East India Company opened up trade to America, merchants from the Northeast quickly established themselves as an important part of the opium trade. Opium was the key that led to the wild success of the China trade and in turn attracted more and more merchants, increasing American presence among the Chinese brokers. The port cities of the east coast, particularly Boston, Baltimore, New York, flourished as trade with the east increased. In turn, the businessmen of these cities invested more and more money into ships built specifically for the passage to Canton. New York was developing as such a successful commercial area that ships that had sailed for Canton from other American ports would come back to the Port of New York to sell the goods they had transported from China.2

There was one catch, however, when it came to this “pharmaceutical” trade. Although there were no regulations or laws again opium in the United States, the Chinese government had forbidden its import into China. Though benefiting the merchants, the opium trade was hurting the Chinese economy, as a great deal of silver was leaving the country to pay for all of the illegal opium coming into the country. These problems led to an economic crisis in China, which was further aggravated by the corruption of Chinese officials bribed by the opium traders. In 1840, the Chinese government began to take steps to end the drug trade by arresting over sixteen hundred Chinese traders, and then confiscating opium from the foreign merchants. The British responded by taking several Chinese ports by force. 3 The Opium War lasted for two years, until 1842. Through it all, the United States government remained neutral. As British trade was forced to cease during the war, the American merchants, ironically still smuggling in opium, were able to essentially build a monopoly around China’s Western commerce. When the merchant headquarters in Canton were threatened during the war, the foreign merchants, with the obvious exception of the British, simply fashioned floating warehouses out in the harbor, refocusing their opium trade to an island sixty miles out to sea, Lintin Island.4 When the war ended, the Americans had firmly established themselves in the trade, and the United States government chose to enter into negotiations with the Chinese government about the opium trade. The Treaty of Wanghia, which was signed on July 3, 1844, gave Americans the same rights that England was awarded with the Treaty of Nanking at the end of the war, but explicitly forbidding opium trade, which had not been included in the Treaty of Nanking.5 This, of course, did little to actually stop the practice. While the British lost a lot of their power in China with the Opium War, the Americans increased their influence. Despite the fact that the American merchants were breaking the same laws that the Chinese government was warring with the British about, the Americans simply did it more quietly and never took an offensive position against the Chinese that may have instigated war. In this manner, the American merchants were able to expand to become the leaders of China’s trade with the west, and not just pertaining to opium, but also with teas, silks, and porcelain.

Although there was a war between England and China and opium trade was illegal in China, these realities did not stop the American merchants from shipping and trading with Canton, the discovery of gold in California in 1849 began to see the decline of the constant voyages to and from China, though by no means did it disappear. Merchant houses began to focus on shipping goods to California, with the hope of obtaining gold in the process. Whereas the goal had once been to achieve the Canton-New York trip in the fastest amount of time, now merchants were trying to achieve the fastest voyages around Cape Horn to San Francisco, California. At this point, China trade was happening almost exclusively from New York, with 48,500 tons of the roughly 75,000 tons arriving in the United States from China coming to New York.6 The already declining clipper ship trade with China ended with the start of the Civil War, as all of the North’s resources, including shipbuilding and the dry good trade, became part of the war effort. Opium was what enabled the American merchant houses to be successful in commerce with a country so different and far away from the emerging American culture, but it was not as important as the building of warships and the shipping of necessary wartime supplies once the Civil War broke out. Without the ability to sell the opium to Chinese merchants, there never would have been an obsession with having the fastest journey to China, merchants simply would not have been as interested. The profit that opium brought in only added to the appeal of the China trips, making it worth the risk to many of the American business houses holding the purse strings of sea commerce.


Endnotes:

1. Thomas M. Layton, The Voyage of the ‘Frolic’: New England Merchants and the Opium Trade (Stanford, Stanford University Press, 1997) 24.

2. Robert Greenhalgh Albion, The Rise of New York Port, 1815-1860 (New York, Charles Scribners’ Sons, 1939) 200.

3. Thomas M. Layton, 24.

4. ibid 37.

5. ibid 38-9.

6. Robert Greenhalgh Albion, 203.

Bibliography

Robert Greenhalgh Albion. The Rise of New York Port, 1815-1860. New York: Charles Scribers’ Sons, 1939.

William Bixby. South Street, New York’s Seaport Museum. New York: David McKay Company, Inc., 1972.

Carl C. Cutler, Greyhounds of the Sea: the story of the American clipper ship .Annapolis: Naval Institute Press, 1984.

David Sanctuary Howard. New York and the China Trade. New York: New York Historical Society, 1984.

Thomas M. Layton. The Voyage of the ‘Frolic’: New England Merchants and the Opium Trade. Stanford: Stanford University Press, 1997.

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