Volume Thirteen - Pre-Victorian to the Present Day - Penarth - born of the economic and geological shift from iron to coal. . . . .

Railway Mania - 1845 to 1847

I wondered if the growth of the coal trade over the iron trade at Cardiff was perhaps either directly or indirectly related to the 'Railway Mania' of the period 1845 to 1847. During 1846, Parliament passed 272 Railway Acts, authorising approximately 4,540 miles of new railway lines and as a result railway company share prices at the stock exchange almost doubled between January 1843 and August 1845. The growth of the coal trade was a result of the need to fuel the numerous new steam engines, both stationary (used for pumping or driving the mills, mines and factories) plus those running upon railways, to support this mania! Additionally, the growth of population and industry of South Wales created demand for fuel which grew exponentially.

The 'Railway Mania Bubble' began bursting in late 1845, for several reasons but primarily due to rising interest rates set by the Bank of England and many investors lost confidence in the railway company's ability to deliver up the promised return on their investment.

Further reasons included the fact that many of the proposed railway schemes competed for the same limited investment capital and further financial pressures caused by poor harvests, food shortages and the commercial crisis of 1847 after which the value of railway company share prices fell dramatically on the stock market, and numerous investors lost substantial amounts of money or, at best, received no return on their investment(s).

The commercial crisis referred to above occurred during late 1847, with its 'Week of Terror.' Over 450 companies collapsed between August 1847 and December 1848 following many bank runs and subsequent failures of both commercial and merchant organisations peaked as liquidity vanished.

However, as already explained, the Bute Ship Canal was conceived and built after the existing Glamorganshire Canal became inadequate for the rapidly growing trade. The key development was undoubtedly the birth of the Taff Vale Railway, which connected Cardiff with the industrial valleys of South Wales. Cardiff thus benefited from the wider railway boom, but its transformation had already begun before 'Railway Mania' reached its peak in 1845.

But what about the iron industry related import and export trade at Cardiff at this time?