Menominee, Michigan, positioned far from the world’s monetary centers a a century back, much as it is today, however put itself straight in the middle of among the most popular organization booms of the early twentieth century – sugar. The little neighborhood that attempted to plant a footprint in world commerce inhabits a slivered point of land that dips into Lake Michigan at a point so close in distance to Wisconsin that had a cartographer’s finger jerked at a turning point, Menominee would remain in Wisconsin rather of Michigan.
Menominee is verged on the east by Green Bay, an arm of Lake Michigan, and on the south-west by the Menominee River. In 1903, numerous financiers in the beet sugar market had a lumber background and had actually hence pertained to think that the exact same rivers that had actually when provided logs to sawmills in abundance might likewise serve the requirements of a beet sugar factory where enormous volumes of water are utilized for fluming beets into the factory, cleaning them and after that diffusing the sugar from them. A sugar factory might quickly put 3 million gallons of water to utilize every twenty-four hours. Barges can bring sugarbeets from the farm fields and trucks can bring items to market. The existence of the Menominee River persuaded financiers that Menominee might take on the country’s sugar manufacturers in spite of unfavorable remarks from cynics who stated Menominee was too far north to effectively grow sugarbeets.
The cynics had a point. Menominee, Michigan is a not likely location to build a beet sugar factory. Located at the western end of Michigan’s Upper Peninsula, the growing season has to do with forty days much shorter than the prime beet growing areas in the state’s Lower Peninsula. The brief season can avoid the ripening of beets which will then reduce sugar material of immature beets ill gotten ready for the tension of the milling procedure. Extreme frosts in early spring are not uncommon and are often deadly to a crop of young beets. Frosts can come early in the fall, too, which can make it difficult to gather a crop. A farmer stood to lose his whole crop either early in the growing season or near the time of harvest after he had actually invested greatly in bringing the sugarbeet crop to term. Financiers, nevertheless, in Menominee, as in much of Michigan’s cities, tended to mark down input from farmers prior to constructing a factory and would regularly translate overstated interest from a handful of growers as representing the wider farming neighborhood. On a regular basis, as in Menominee’s case, as it would end up, the handful did not represent the entire.
Official acknowledgment by the United States Department of Agriculture in 1898 of the value of the sugarbeet market stimulated the building and construction of beet sugar factories throughout the country. One year previously the country might boast just 10 beet sugar factories, 4 of which remained in California, one in Utah, 2 in Nebraska and 3 in New York. The building and construction of 7 sugarbeet factories in 1898 brought into focus for the very first time the stirrings of a rush not unlike the dot-com boom that progressed almost one a century later on. The concept that sugar produced from sugarbeets might take on sugar produced from sugarcane broadened into a full-fledged boom by 1900 when the across the country count of sugarbeet factories stood at thirty-two in eleven states.
Nowhere was the blaze hotter than in Michigan where 9 factories followed the effective launch of a factory in Essexville, Michigan, a residential area of Bay City. A burst of cyclonic interest triggered a mad scramble when financiers, farmers, lenders, and fitters integrated abilities and energies to bring to life 8 factories in a single year! They remained in Holland, Kalamazoo, Rochester, Benton Harbor, Alma, West Bay City, Caro, and a 2nd factory in Essexville. In spite of the scarceness of factory fitters and the engineers to run them, fourteen extra factories increased on the borders of Michigan towns throughout the next 6 years, among which appeared in Menominee in 1903.
In Menominee, a group of financiers undeterred by the natural drawbacks and buoyed by motivation from experienced professionals and prominent financiers, set a strategy in movement to preserve the financial practicality of their city after the approaching death of the lumber market, which had actually till then offered the foundations of Menominee’s economy. The strategy consisted of the style of among the biggest and most modern-day sugarbeet factories to appear in America approximately that time.
As the lumber period abated at the start of the 20th century, railways that had actually entered their own since of wood, looked for brand-new sources of income. Principal amongst them was the Detroit and Mackinac Railroad whose land representative, Charles M. Garrison, gathered and dispersed info about the capacity of the sugarbeet market. While Garrison spread out word amongst Detroit’s investors about potential earnings in sugarbeets, neighborhoods impacted by the decrease of lumber wanted to location resources for methods of renewing wealth. They had plenty to deal with. The state was crisscrossed with railway and rivers and some left over money from the lumber period. With Garrison blazing a trail, financiers livened up. Neighborhoods excited to discover a fast replacement for lumber sped up to go to conferences sponsored by Garrison and quicker yet to bring their towns into the fold. All that was required was to convince the farmers to grow the beets. That is where the Michigan Agricultural College (Now Michigan State University) actioned in.
Upper Peninsula farmers, motivated by Michigan Agricultural College to plant sugarbeet test plots, got an even higher shot in the arm by the go to of Secretary of Agriculture James Wilson, in 1902. He stated the benefits of sugarbeets and dissuaded the concept that the Upper Peninsula’s environment wasn’t approximately the job of producing successful crops. Wilson served in 3 governmental cabinets, McKinley, Roosevelt, and Taft, serving longer (1897-1913) than any other cabinet authorities. He motivated modern-day farming techniques, consisting of transport and education as they used to farming. His word brought a great deal of weight. When he mentioned sugarbeets, some farmers listened and when his department avowed that the cold northern temperature levels would not prevent the advancement of the market in their community, makers, farmers, and financiers lined up to start the market in Menominee. When the United States Department of Agriculture (USDA) revealed beneficial outcomes of the sugarbeet plot tests,
Optimism increased to brand-new heights. The Sugar Beet News of December 15, 1903, reported test arise from beets provided by around 140 farmers. The trial run exposed 15.6 to 19.9 % sugar, which indicated a money worth to the farmers per acre of from $5.70 to $7.13 per lot ($ 135-$ 169 inflation adapted to the present duration). At those predicted costs, no crop in human history had actually held the capacity for developing such a high return from so couple of acres.
In the Lower Peninsula, a farmer with above typical capability who put fifteen acres in sugarbeets might make more than $800 and if his household offered the bulk of the labor, the net earnings would more than look after a household’s requirements for a year, which, consisting of food, was less than $800. After including income from crops in rotation and incomes from milk, eggs, and poultry, the farm household’s requirement of living advanced from a subsistence level to one that compared positively to those who held mid-management positions in market. USDA figures supported belief that Upper Peninsula beets would go beyond by 2 percent the average for all the other 18 sugar beet factories in the Lower Peninsula.
If the tests showed trustworthy indications, Menominee area beets deserved approximately $10 more an acre than Lower Peninsula beets, ensuring an earnings of almost $1,000 annually simply from sugarbeets.
Although interest was on the upturn, something more was required to seal the offer. To impart self-confidence in potential financiers that technical knowledge lay near at hand, Benjamin Boutell, who won popularity as both a tugboat captain and as a captain of market, got here in Menominee from his Bay City, Michigan head office for the single function of communicating interested financiers to Bay County where they might see groomed beet fields and effective factories drawing out white crystalline sugar. Eleven potential financiers accompanied Boutell to Bay City where persuading proof lay at hand. 4 beet sugar factories, more than in any other city in the United States, had actually been built because city’s environments. Due to the fact that of the existence of sugar factories, Bay City practically hummed with financial activity. Estates peopled by previous lumber barons who had actually changed themselves into sugar barons, lined the city’s distinguished Center Avenue.
Boutell revealed he would turn into one of the financiers, supplying the other financiers had no objection to having actually a factory developed and set up by Joseph Kilby who was according to Boutell, the finest contractor of beet sugar factories in the United States. Lots of others concurred with Boutell’s evaluation; Kilby developed 9 of the ultimate twenty-four factories integrated in Michigan. Regional financiers lined up behind Boutell to arrange the Menominee River Sugar Company. A half lots essential backers stepped forward, each of whom signed up for more than $25,000 in stock of the Menominee River Sugar Company.
Heading up the list of regional investors was Samuel M. Stephenson, a previous lumber producer and local of New Brunswick, Canada who had actually made a house for himself, his better half, Jennie and their 4 children and one kid, in Menominee. He was then seventy-one years of age however in no state of mind for retirement. Following an effective profession in lumber and banking, he served 3 succeeding terms in Congress (Michigan’s 11th District 1889-93 and the 12th District 1893-97). He invested $100,000 ($ 2 million by modern-day requirements) in the beet sugar factory, taking heart in not just beneficial test plot outcomes and the interest of his next-door neighbors however likewise interest revealed by the American Sugar Refining Corporation, usually understood by its then popular sobriquet, the Sugar Trust. Some years later on the Sugar Trust would fall under disfavor as an outcome of charges of unreasonable organization practices, however in 1903, it had the self-confidence of the public and financiers alike and managed the manufacture and sale of 98% of sugar consumed in the United States. Trust Executives, Arthur Donner and Charles R. Heike, invested $300,000 to get 36% of Menominee River Sugar Company’s stock.
All the members of the board of directors and lineup of officers apart from Bay City citizen, Benjamin Boutell, noted Menominee as their house of record. Menominee locals comprised 74% of the investors. Together, they managed 53% of the shares. In addition to Stephenson, other significant investors who likewise accepted positions as either directors or officers were: William O. Carpenter who invested $55,000 and served the sugar business otherwise as president and vice-president. Gustave A. Blesch invested $15,000 and functioned as treasurer. John Henes, a brewery owner, invested $25,000 and functioned as a director. Augustus Spies was the 2nd biggest financier after Stephenson and the Sugar Trust. He, too, functioned as a director.
Spies offer an outstanding example of the sturdy pioneering spirit that dominated in Menominee. He hailed the grand duchy of Hessen-Darmstadt, Germany where fertile soils and a moderate environment enabled the production of grain and white wine. He took part in the starting of the Stephenson National Bank in collaboration with future U.S. Congressman Samuel M. Stephenson and Samuel’s sibling, future U.S. Senator, Isaac Stephenson. In addition, he owned the Spies Lumber Company and a number of big systems of forest; he was a financier in the First National Bank of Menominee, the Marinette and Menominee Paper Company and president of the Menominee Light, Railroad and Power Company. When the recently established sugar business got under method, he advance with $75,000 ($ 1.5 million in present dollars).
Support from Menominee’s rich class, who likewise shared differences of making great organization choices and increasing by themselves benefit instead of acquired wealth, was so fantastic that there was no requirement to get funds from the general public at big. With its shares over-subscribed by $35,000, the Menominee River Sugar Company remained in the excellent position of having appropriate capital for its endeavor. Not just was it had of enough capital however likewise it took pleasure in the included advantage of the experience of Benjamin Boutell and agents of the Sugar Trust. Menominee would not desire for technical or organization knowledge.
Gustave Blesch, like Augustus Spies, owed his success to the acquired qualities of effort, sincerity and the regard of his peers. He would end up being the sugar business’s very first treasurer. He was born in Green Bay, Wisconsin in 1859, the kid of Francis Blesch, a local of Germany and Antoinette Schneider, a local of Belgium. Gustave ended up being a workplace young boy in the Kellogg National Bank of Green Bay, increasing to teller by the age of twenty. 5 years later on, he relocated to Menominee to assist develop the First National Bank of Menominee where he started as cashier prior to ending up being the bank’s president. He ended up being president of the Menominee Brick Company, vice-president of the Menominee-Marinette Light & & Traction Company, and treasurer of the Peninsula Land Company.
In January, 1903, the freshly chosen board of directors authorized an $800,000 (almost $19 million in present period dollars) building and construction agreement for a Kilby developed and developed factory that would slice 1,000 lots of beets daily. Of the 48 beet sugar factories in operation in the United States in 1903, just 2 were bigger than Menominee’s brand-new factory, one in Salinas, California and another in Fort Collins, Colorado.
The typical sugar factory in Michigan in 1903 might slice 6 hundred lots of beets in a twenty-four hour duration. 4 thousand acres of beets would quickly provide a season’s factory run. Had the financiers surveyed the farmers initially, undoubtedly they would have been encouraged to develop a smaller sized factory, and maybe would have been convinced to develop none. Farmers provided beets from around 1,500 acres, well except the 9,000 acres the financial investment required.
The Menominee factory’s very first factory run (described as a “project” in the sugar market) ended rapidly, having actually gotten just 14,263 loads, enough for a production run of fourteen days for a factory the financiers prepared to run a minimum of one hundred days. The farmers had actually sent beets including the greatest sugar reported of any business throughout its very first project, 15.04 percent – about 20 percent more than adequate and typical to enable for a little earnings from a weak beet supply. Like almost all the factories, records that would notify us of earnings, if any, made throughout that very first project, did not make it through the passage of time. It would be sensible to approximate, based on the recognized expense of products of coal, coke, limestone and the expense of labor, that a revenue of $36,000 was possible, specifically under a management design that paid close attention to expenses and specifically in light of the really high portion of sugar in the beets.
The 2nd project was much better with adequate beets for a complete month, still well except a supply required to create earnings enough to validate the financial investment. By 1911, the regional supply reached a level that enabled constant earnings however was inadequate to motivate growth, a condition that continued till 1926 when grower passiveness was up to a level that needed closing the factory till 1933 when it resumed for a last run of twenty years throughout which the factory dragged the market in innovation and development. Year in and year out, since of an insufficient supply of beets, primarily grown in Wisconsin, the underutilized factory ended its project weeks earlier than was required to produce healthy earnings which then might have been reinvested in the factory. Menominee financiers found out, as did numerous other sugar factory financiers, that the mantra, “develop it and they will come” fell on deaf ears amongst farmers who typically showed a much better understanding of sugar economics than did financiers.
The passage of time brought neither damage nor excellent to the Menominee factory as it was not able to update or broaden. It settled into the procedure of elegant aging. Earnings waiting for chance slowly built up thanks to the business’s penurious management design and a devoted cadre of farmers.
George W. McCormick, the business’s very first supervisor, inaugurated a cautious management design that went a long method towards keeping the business successful in spite of yearly shortages in the beet supply. He handled the business throughout its very first thirty-two years of operation, starting when he was twenty-four years of age. When he moved there to take a task as a district supervisor for Travelers Insurance Company, he satisfied Benjamin Boutell in Bay City. Boutell believed the boy belonged in the quickly establishing sugar market and motivated him to assist in the facility of a sugar factory in Wallaceburg, Ontario. After finishing the task with success, Boutell suggested him for the supervisor’s task in Menominee.
Menominee was the most hard location in the United States to process sugarbeets. The low temperature levels took a heavy toll on employees, equipment and beets that typically went through the slicing makers like stones, harmful devices that robbed the factory of slim resources. It was hard to discover replacement parts since of the range separating Menominee from providers and from Lower Peninsula sugar factories where it prevailed for factory supervisors to provide extra parts to one another.
The business’s persistent attention to cost control settled in 1924 when sugar factories situated in Green Bay and Menominee Falls, Wisconsin went on the marketplace. Menominee River Sugar Company acquired both and after that invested substantial amounts in bring back the Menominee Falls factory that had actually been shut for 3 years right away preceding its sale.
The refurbished Menominee Falls factory integrated with the Green Bay and Menominee, Michigan factories developed more capability than was required for the readily available acreage. Among the factories would need to close. Menominee won the noose after the accounting professionals counted up the freight expenses for carrying beets to each factory. The Menominee factory stayed closed till 1933 when Michigan’s farmers concurred and relented to go back to sugarbeets, a choice that came far too late to conserve the hides of the sugar business’s owners who had actually lost the business to defaulted bonds 3 years previously.
Disruptions in Europe starting in the early part of the 1930s brought a brand-new name to Michigan’s beet sugar fields and business workplaces – Flegenheimer. Albert Flegenheimer was the kid of Samuel Flegenheimer who had actually immigrated to the United States in either 1864 or 1866 and ended up being a naturalized person in 1873. The next year, nevertheless, he went back to Germany, settling in Wurttemberg. He lived out his life there, passing away in 1929 at the age of 81. His quick layover in the United States and his U.S. citizenship status, nevertheless, would one day conserve his descendants from German death camps.
In February 1939, Albert Flegenheimer brought his household to the security of Canada and after that to the U.S. declaring citizenship as the kid of a naturalized person. He prepared to raise his household and dedicate his time to the sugar market in both the United States and Canada. His strategies met substantial success and by 1954, he managed the sugar factory in Menominee and the one in Green Bay, Wisconsin.
Despite Albert Flegenheimer’s efforts, an absence of interest on the part of farmers kept the factory out-of-date and little. It had a hard time year by year till lastly in 1955 with its devices tired, its structures in scruffy repair work and its farmers pursuing other crops, Menominee River Sugar Company, developed on dreams and hopes and run with perseverance and perseverance for more than a half-century, closed its doors permanently.
GUTLEBEN, Dan, The Sugar Tramp-1954- Michigan, Printed by: Bay City Duplicating Co, San Francisco, 1954
1962 TWIN CITY COMMUNITY RESOURCES WORKSHOP, area entitled Famous Leaders Who Helped Build Menominee, prepared by Irene Swain, Dr. Leo J. Alilunas, Director.
HENLEY, ROBERT L., Sweet Success … The Story of Michigan’s Beet Sugar Industry 1898 – 1974, Michigan Historical Center, Department of History, Libraries and artshttp://www.westegg.com/inflation
INFLATION ADJUSTMENTS: The pre-1975 information are the Consumer Price Index data from Historical Statistics of the United States (USGPO, 1975). All information ever since are from the yearly Statistical Abstracts of the United States. Taped at
MICHIGAN ANNUAL REPORTS, Michigan Archives, Lansing, Michigan
© 2009 Thomas Mahar
About the Author:
Thomas Mahar functioned as Executive Vice President of Monitor Sugar Company in between 1984 and 1999 and as President of Gala Food Processing, a sugar product packaging business, from 1993-1998. He retired in 1999 and now commits his spare time to blogging about the history of the sugar market. He authored, Sweet Energy, The Story of Monitor Sugar Company in 2001.(*)