WAR DEPARTMENT,

Richmond, Va., August 4, 1864.

Brigadier General G. B. HODGE:

GENERAL: You have been assigned to the command of the district comprising a large portion of MISSISSIPPI and East Louisiana. In addition to the military duties which will devolve upon you in repelling the enemy, and affording protection to the district, you are specially relied on the discountenance, and, as far as practicable, stop the illicit and demoralizing trade, especially in cotton, with the enemy, which is reported as prevailing in that district. Such trade has been prohibited by special enactments and by various orders from this Department, to which your special attention is directed. These have not been considered as precluding the Department from occasionally making contracts, or authorizing the disposition of cotton in such manner as to secure adequate supplies, either of munitions of war or stores essential to the use of the army, and in pursuance of such contracts authorities have been given to a few individuals to pass cotton received by them in exchange for such articles through the lines. Such contracts and permissions have been given with great caution, and it is believed in all cases with restrictions requiring that there should be no trade to New Orleans, and, likewise, that cotton should only be delivered in actual payment for supplies received. The only contract believed to have been made by any of the bureaus of this Department directly is one to a large amount for the supply of subsistence and quartermaster stores for the army. A copy of this will be furnished, and while you are requested to exercise great vigilance and circumspection in not allowing it to be the subject of abuse or undue extension you will yet respect its obligations and allow it to be carried out in good faith. Any other authorities existing in your district from commanders of departments or other officers should be at once calleed by you, so that their genuineness may be tested and their character reported, as it has been represented that there are many spurious, and others perhaps incautiously issued.ll proper steps to warn the people against the indulgence in such trades, and to show them the penalties they incur, and the mischievous consequences that will result tot hem and the country from its prosecution. The repression of this trade pertains as well tot he Treasury as to the military authority, and you will co-operate with them, and give all the assistance which may be required in enforcing the regulations or instructions of that Department. In addition tot he important duties with which it is expected the agents of the Treasury Department will be engaged, in connection with this trade, it is likewise expected that they will be actively employed in preserving and removing the cotton held by it within the limits of your district, as likewise in purchasing by exchange or for money further supplies of cotton, which it will also be interested to remove to more secure localities. These operations are deemed of great importance to the Government, and you are expected and instructed to give all assistance and facilities you can to the Treasury agents in accomplishing them. The season now approaching is believed to be the most favorable, both with reference to the command of teams and the state of the roads for transportation in your district, and you will give the aid of your influence and authority in obtaining all the transportation that can be commanded for the removal of such cotton to the points that may be designated by the agents of the Treasury. You are likewise requested to impress upon all loyal citizens in exposed localities the