HEADQUARTERS, &C., March 30, 1865.

Commodore J. S. PALMER,
(Care General Bailey.)

Your dispatch is just received. We expect to open with the heavy guns and mortars to-morrow morning. I will send the admiral to-night a copy of the survey showing our positions.

E. R. S. CANBY,

Major-General, Commanding.

HEADQUARTERS DEPARTMENT OF THE GULF,
New Orleans, March 30, 1865.

Lieutenant Colonel C. T. CHRISTENSEN,

Assistant Adjutant-General:

I forward with this letter report from A. P. H. Stuart, sent to Mobile last January. His statements are probably true in the main. He reports also to me that the following parties in Mobile may be relied on as Union people, and requests protection: Moses Foote, Frank Chamberlain nd family, late of the Battle House. I am in possession of news from Shreveport which induces me to believe that, if possible, a full division, say 6,000 men, will cross the Mississippi. The lines are closed rigidly, cotton trade stopped, gun-boats ordered from Shreveport to Alexandria, and every indication of a movement of troops. Heavy guns from Alexandria have been sent to Grand Ecore, and orders given to treat all persons [trading] for cotton under Yankee permits as spies. The cargo (dry goods, &c.) of the Anna Perrett for her return of cotton sales has been seized and the captain and supercargo placed in irons. The navy and General Herron have been fully advised of the probable movements. There appears to be a general belief everywhere that the rebellion topples toward its fall. Cotton is 47 cents in New York, gold $1.53. Mansfield & Co. are reported to be losers to $1,500,000. There is great anxiety here to know the probable action of General Canby as to cotton in Alabama and Georgia, and many operations are in progress based upon his supposed action. There have been persons here of high positions in Alabama professing to control large amounts in Selma and Montgomery. I have stated to one of them, Mr. Weaver, formerly secretary of the State of Alabama, that I do not believe the Government will interfere with the private property of peaceable citizens in the country. They are willing to deliver their cotton to the United States direct to whatever officer may be designated, and to give one-fourth or more if required; the remainder to await final action in the hands of the Government. I think if an order of this nature was published the people would save their cotton from the conflagration ordered by the military authorities of the C. S. Army. If adopted by general order this system would cut off much speculation and free decent people from the plunderers. I propose when Mobile is captured to send over a load of provisions or two for the immediate wants of such people as may be left there, and shall take care that nothing goes except purely provisions. It will be understood distinctly by the persons who may be allowed to take them that their landing and sale is dependent entirely upon General Canby's permission, unless I should receive such permission before-hand. I conceive that it is probable that distress may occur unless some such arrangement is made.

Hoping to hear from you soon in the Gulf city, I remain, your obedient servant,

S. A. HURBLUT,

Major-General, Commanding.