Menominee, Michigan, situated faraway from the world's financial centers a hundred years ago, up to it is today, nevertheless placed itself directly in the heart of one with the hottest business booms in the early twentieth century - sugar. The small community that dared to plant a footprint in world commerce occupies a slivered point of land that dips into Lake Michigan at a point so close in proximity to Wisconsin which in fact had a cartographer's finger twitched with a crucial moment, Menominee can be in Wisconsin rather than Michigan.
Menominee is bordered for the east by Green Bay, an arm of Lake Michigan, and around the south-west with the Menominee River. In 1903, many investors within the beet sugar industry a timber background and had thus visit believe that exactly the same rivers that had once delivered logs to sawmills by the bucket load could also serve the requirements of a beet sugar factory where massive volumes of water bring fluming beets in to the factory, washing them and then diffusing the sugar at their store. A sugar factory could easily put three million gallons of water to use every twenty-four hours. Barges can carry sugarbeets through the farm fields and freighters can transport products to showcase. The presence of the Menominee River convinced investors that Menominee could tackle the nation's sugar producers despite negative comments from naysayers who said Menominee was past an acceptable limit north to actually grow sugarbeets.
The naysayers stood a point. Menominee, Michigan can be an unlikely location to construct a beet sugar factory. Situated at the western end of Michigan's Upper Peninsula, the time of year is about forty days shorter compared to prime beet growing regions in the state's Lower Peninsula. The short season can steer clear of the ripening of beets which will then lessen sugar content of immature beets ill prepared for that stress from the milling process. Severe frosts at the begining of spring are not unusual and are almost always fatal to a crop of young beets. Frosts may come early in the fall, too, that make it impossible to harvest a crop. A farmer stood to reduce his entire crop either early inside growing season or close to the time of harvest after he had invested heavily in bringing the sugarbeet crop to term. Investors, however, in Menominee, as with many of Michigan's cities, tended to discount input from farmers before creating a factory and would frequently interpret exaggerated enthusiasm from your handful of growers as representing the broader farming community. Quite often, such as Menominee's case, mainly because it would end up, the handful failed to represent the full.
Official recognition from the United States Department of Agriculture in 1898 from the importance with the sugarbeet industry sparked the making of beet sugar factories around the world. One year earlier the country could boast only ten beet sugar factories, four that were in California, one inch Utah, two in Nebraska and three in New York. The construction of seven sugarbeet factories in 1898 brought into focus for the first time the stirrings of your rush not unlike the dot-com boom that blossomed nearly 100 years later. The idea that sugar created from sugarbeets could take on sugar made out of sugarcane expanded into a full-fledged boom by 1900 when the nationwide count of sugarbeet factories stood at thirty-two in eleven states.
Nowhere was the blaze hotter compared to Michigan where nine factories followed the successful start up of your factory in Essexville, Michigan, a suburb of Bay City. A burst of cyclonic enthusiasm caused a mad scramble when investors, constructors, bankers, and farmers combined energies and skills to take to life eight factories in one year! They were in Holland, Kalamazoo, Rochester, Benton Harbor, Alma, West Bay City, Caro, and a second factory in Essexville. Despite the paucity of factory constructors and the engineers to function them, fourteen additional factories rose around the outskirts of Michigan towns throughout the next six years, one that appeared in Menominee in 1903.
In Menominee, a gaggle of investors undeterred with the natural disadvantages and buoyed by encouragement from influential investors and knowledgeable experts, set an agenda in motion to maintain the economic viability of these city following your approaching demise with the lumber industry, which had until then provided the underpinnings of Menominee's economy. The plan included the design of one from the largest and a lot modern sugarbeet factories to seem in America up to that time.
As the lumber era petered out on the beginning with the 20th century, railroads which had come into their own because of timber, sought new sources of revenue. Principal one of them was the Detroit and Mackinac Railroad whose land agent, Charles M. Garrison, collected and distributed information about the potential from the sugarbeet industry. While Garrison spread word among Detroit's financiers about prospective profits in sugarbeets, communities affected from the decline of lumber looked to area practical information on ways of replenishing wealth. They had plenty to use. The state was crisscrossed with rail lines and rivers and a few left over cash in the lumber era. With Garrison at the forefront, investors perked up. Communities wanting to find a quick replacement for lumber hastened to wait meetings sponsored by Garrison and quicker yet to bring their towns in to the fold. All that was needed would have been to persuade the farmers growing the beets. That is where the Michigan Agricultural College (Now Michigan State University) stepped in.
Upper Peninsula farmers, encouraged by Michigan Agricultural College to plant sugarbeet test plots, received an even greater shot inside arm by the visit of Secretary of Agriculture James Wilson, in 1902. He expounded the benefits of sugarbeets and discouraged the notion that this Upper Peninsula's climate wasn't around the task of producing profitable crops. Wilson served in three presidential cabinets, McKinley, Roosevelt, and Taft, serving longer (1897-1913) than another cabinet official. He encouraged modern agriculture methods, including transportation and education since they applied to agriculture. His word carried a great deal of weight. When he spoke of sugarbeets, some farmers listened then when his department avowed the cold northern temperatures wouldn't normally inhibit the development with the industry inside their neighborhood, investors, farmers, and manufacturers lined as much as begin a in Menominee.
Optimism rose to new heights once the United States Department of Agriculture (USDA) announced favorable results from the sugarbeet plot tests. The Sugar Beet News of December 15, 1903, reported test comes from beets delivered by approximately 140 farmers. The test runs revealed 15.6 to 19.9 % sugar, which meant a cash value on the farmers per acre of from $5.70 to $7.13 per ton ($135-$169 inflation adjusted for the current period). At those projected prices, no crop in human history had held the chance of creating this kind of high return from so few acres.
In the Lower Peninsula, a farmer with above average ability who placed fifteen acres in sugarbeets could earn greater than $800 and when his family provided the bulk with the labor, the internet profit would greater than take care of your family's needs for any year, which, including food, was under $800. After adding revenue from crops in rotation and revenues from milk, eggs, and poultry, the farm family's quality of life advanced from the subsistence level to one that compared favorably to those who held mid-management positions in industry. USDA figures supported belief that Upper Peninsula beets would exceed by two per cent the average for all you other 18 sugar beet factories inside Lower Peninsula.
If the tests proved reliable indicators, Menominee region beets were worth approximately $10 more an acre than Lower Peninsula beets, assuring profits of nearly $1,000 each year just from sugarbeets.
Although enthusiasm was about the upturn, something more was needed to seal the sale. To instill confidence in prospective investors that technical expertise lay near available, Benjamin Boutell, who won fame as both a tugboat captain in addition to being a captain of industry, found its way to Menominee from his Bay City, Michigan headquarters for that single purpose of conveying interested investors to Bay County where they are able to see groomed beet fields and efficient factories spinning out white crystalline sugar. Eleven prospective investors accompanied Boutell to Bay City where convincing evidence lay available. Four beet sugar factories, more in comparison to any other city inside United States, ended up constructed in that city's environs. Bay City virtually hummed with economic activity because of the presence of sugar factories. Mansions peopled by former lumber barons who had transformed themselves into sugar barons, lined the city's prestigious Center Avenue.
Boutell announced although become one from the investors, providing the other investors had no objection to using a factory designed and installed by Joseph Kilby who had previously been according to Boutell, the finest constructor of beet sugar factories within the United States. Many others agreed with Boutell's assessment; Kilby built nine in the eventual twenty-four factories built in Michigan. Local investors aligned behind Boutell to arrange the Menominee River Sugar Company. A half dozen important backers came forward, everyone of whom subscribed to greater than $25,000 in stock in the Menominee River Sugar Company.
Heading inside the list of local shareholders was Samuel M. Stephenson, a former lumber manufacturer and native of New Brunswick, Canada who had made a home for himself, his wife, Jennie along with their four daughters then one son, in Menominee. He was then seventy-one yrs . old but in no mood for retirement. Following a successful career in lumber and banking, he served three successive terms in Congress (Michigan's 11th District 1889-93 and also the 12th District 1893-97). He invested $100,000 ($2 million by modern standards) within the beet sugar factory, taking heart in not just favorable test plot results and the enthusiasm of his neighbors but in addition interest shown through the American Sugar Refining Corporation, generally known by its then popular sobriquet, the Sugar Trust. Some years later the Sugar Trust would fall under disfavor due to charges of unfair business practices, however in 1903, it had the confidence in the general public and investors alike and controlled the manufacture and sale of 98% of sugar consumed within the United States. Trust Executives, Arthur Donner and Charles R. Heike, invested $300,000 to acquire 36% rosa parks nah of Menominee River Sugar Company's stock.
All the members in the board of directors and roster of officers besides Bay City resident, Benjamin Boutell, listed Menominee for their home of record. Menominee residents comprised 74% from the shareholders. Together, they controlled 53% with the shares. In addition to Stephenson, other major shareholders who also accepted positions as either officers or directors were: William O. Carpenter who invested $55,000 and served the sugar company variously as president and vice-president. Gustave A. Blesch invested $15,000 and served as treasurer. John Henes, a brewery owner, invested $25,000 and served being a director. Augustus Spies was the second largest investor after Stephenson and also the Sugar Trust. He, too, served like a director.
Spies offer an excellent example of the hardy pioneering spirit that prevailed in Menominee. He was a native of the grand duchy of Hessen-Darmstadt, Germany where fertile soils plus a mild climate allowed the production of grain and wine. He participated in the founding in the Stephenson National Bank in partnership with future U.S. Congressman Samuel M. Stephenson and Samuel's brother, future U.S. Senator, Isaac Stephenson. In addition, he owned the Spies Lumber Company as well as some large tracts of forest; he was an investor in the First National Bank of Menominee, the Marinette and Menominee Paper Company and president from the Menominee Light, Railroad and Power Company. When the fledgling sugar company got under way, he stepped forward with $75,000 ($1.5 million in current dollars).
Support from Menominee's wealthy class, who also shared distinctions of creating good business decisions and rising on their very own merit as opposed to inherited wealth, am great that there was no have to solicit funds from the public in particular. With its shares over-subscribed by $35,000, the Menominee River Sugar Company was inside enviable position of having adequate capital for its venture. Not only maybe it was possessed of sufficient capital but in addition it enjoyed the added benefit in the experience of Benjamin Boutell and representatives of the Sugar Trust. Menominee wouldn't want for technical or business expertise.
Gustave Blesch, like Augustus Spies, owed his success to the inherited qualities of work, honesty and also the respect of his peers. He would become the sugar company's first treasurer. He was born in Green Bay, Wisconsin in 1859, the son of Francis Blesch, a native of Germany and Antoinette Schneider, a native of Belgium. Gustave became a business office boy within the Kellogg National Bank of Green Bay, rising to teller from the age of twenty. Five years later, he transferred to Menominee to help you establish the First National Bank of Menominee where he started as cashier before becoming the bank's president. He became president with the Menominee Brick Company, vice-president from the Menominee-Marinette Light & Traction Company, and treasurer of the Peninsula Land Company.
In January, 1903, the newly elected board of directors approved an $800,000 (nearly $19 million in current era dollars) construction contract to get a Kilby designed and built factory that might slice 1,000 tons of beets per day. Of the 48 beet sugar factories in operation inside the United States in 1903, only two were larger than Menominee's new factory, one out of Salinas, California and another in Fort Collins, Colorado.
The average sugar factory in Michigan in 1903 could slice six hundred a great deal of beets in a twenty-four hour period. Four thousand acres of beets would easily give you a season's factory run. Had the investors surveyed the farmers first, surely they would have been advised to construct a smaller factory, as well as perhaps would happen to be persuaded to build none. Farmers delivered beets from approximately 1,500 acres, well short from the 9,000 acres it demanded.
The Menominee factory's first factory run (referred to being a "campaign" within the sugar industry) ended quickly, having received only 14,263 tons, enough for a production run of fourteen days for the factory the investors planned to use at least one hundred days. However, the farmers had submitted beets containing the best sugar reported of any company during its first campaign, 15.04 percent - about 20 percent a lot more than average and enough to allow for the small profit coming from a meager beet supply. Like nearly all the factories, records that might inform us of profit, if any, earned during that first campaign, did not survive the passage of your energy. However, it will be reasonable to estimate, based for the known expense of supplies of coal, coke, limestone and the cost of labor, that a profit of $36,000 was achievable, especially within a management style that paid close care about expenditures and especially in light from the very high number of sugar inside the beets.
The second campaign was better with enough beets to get a full month, still well short of your supply required to generate profits enough to justify it. By 1911, the local supply reached a quantity that allowed steady profits but was insufficient to encourage expansion, a condition that persisted until 1926 when grower apathy fell with a level that required closing the factory until 1933 when it reopened for the final run of twenty years during which the factory lagged behind the industry in technology and growth. Year in and year out, as a consequence of an inadequate way to obtain beets, mostly grown in Wisconsin, the underutilized factory ended its campaign weeks sooner than was needed to produce healthy profits which then could have been reinvested inside the factory. Menominee investors learned, as did a number of other sugar factory investors, how the mantra, "build it and they'll come" fell on deaf ears among farmers who often displayed an improved understanding of sugar economics than did investors.
The passage of your energy brought neither harm nor good to the Menominee factory as it was struggling to expand or modernize. It settled into the process of graceful aging. Profits awaiting opportunity gradually accumulated thanks to the company's penurious management style along with a dedicated cadre of farmers.
George W. McCormick, send out first manager, inaugurated a careful management style that went a considerable ways toward keeping the company profitable despite annual shortfalls inside beet supply. He managed the business during its first thirty-two a lot of operation, beginning when he was twenty-four years. He met Benjamin Boutell in Bay City when he moved there to take a job like a district manager for Travelers Insurance Company. Boutell thought the son belonged inside rapidly developing sugar industry and encouraged him to help inside the establishment of a sugar factory in Wallaceburg, Ontario. After completing the assignment with success, Boutell recommended him for your manager's job in Menominee.
Menominee was one of the most difficult place inside the United States to process sugarbeets. The low temperatures took a heavy toll on workers, machinery and beets very often went through the slicing machines like boulders, damaging equipment that robbed the factory of slender resources. It was difficult to find replacement parts because in the distance separating Menominee from suppliers and from Lower Peninsula sugar factories where it was common for factory managers to lend spare parts to one another.
The company's diligent attention to cost control paid back in 1924 when sugar factories in Green Bay and Menominee Falls, Wisconsin went for the market. Menominee River Sugar Company purchased both and then invested significant sums in restoring the Menominee Falls factory which in fact had been shut for three years immediately preceding its sale.
The renovated Menominee Falls factory combined with Green Bay and Menominee, Michigan factories created more capacity than was needed for that available acreage. One with the factories must close. Menominee won the noose following your accountants counted the freight costs for hauling beets to every factory. The Menominee factory remained closed until 1933 when Michigan's farmers relented and decided to return to sugarbeets, a determination that came far too late to save the hides from the sugar company's owners who had lost the company to defaulted bonds 3 years earlier.
Disruptions in Europe beginning inside early part of the 1930s brought a new name to Michigan's beet sugar fields and corporate offices - Flegenheimer. Albert Flegenheimer was the son of Samuel Flegenheimer who had immigrated for the United States in either 1864 or 1866 and became a naturalized citizen in 1873. The next year, however, he returned to Germany, settling in Wurttemberg. He lived out his life there, dying in 1929 in the age of 81. His brief sojourn inside the United States and the U.S. citizenship status, however, would some day save his descendants from German death camps.
In February 1939, Albert Flegenheimer carried his family to the safety of Canada and then to the U.S. claiming nationality as the son of an naturalized citizen. He planned to improve his family and devote his time for the sugar industry in the the United States and Canada. His plans met with considerable success by 1954, he controlled the sugar factory in Menominee and the one out of Green Bay, Wisconsin.
Despite Albert Flegenheimer's efforts, an absence of interest about the part of farmers kept the factory small , outdated. It struggled year by year until finally in 1955 having its equipment exhausted, its buildings in tattered repair as well as farmers pursuing other crops, Menominee River Sugar Company, built on hopes and dreams and operated with fortitude and persistence for greater than a half-century, closed its doors forever.
Sources:
GUTLEBEN, Dan, The Sugar Tramp-1954- Michigan, Printed by: Bay City Duplicating Co, San Francisco, 1954
1962 TWIN CITY COMMUNITY RESOURCES WORKSHOP, section entitled Famous Leaders Who Helped Build Menominee, made 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, Arts and Libraries
INFLATION ADJUSTMENTS: The pre-1975 data include the Consumer Price Index statistics from Historical Statistics with the United States (USGPO, 1975). All data since that time are in the annual Statistical Abstracts from the United States. Recorded at
MICHIGAN ANNUAL REPORTS, Michigan Archives, Lansing, Michigan(c)2009 Thomas Mahar
About the Author:Thomas Mahar served as Executive Vice President of Monitor Sugar Company between 1984 and 1999 in addition to being President of Gala Food Processing, a sugar packaging company, from 1993-1998. He retired in 1999 and now devotes his free time for you to writing about the history in the sugar industry. He authored, Sweet Energy, The Story of Monitor Sugar Company in 2001.