Michigan's sugar experience - A brief history

Michigan's First Beet Sugar Factory - Essexville, Michigan, 1898

Michigan’s Beet Sugar History
By Thomas Mahar

In Michigan’s Bay City suburb of Essexville on October 17, 1898, a smiling Governor Hazen B. Pingree was on hand to witness the beginning of Michigan’s first beet sugar harvest. By doing so, Pingree heralded a period of speculative investment in beet sugar manufacturing marked by the founding of companies that sometimes rose overnight to spectacular heights and just as quickly spiraled downward to oblivion, carrying away the savings of thousands of small investors. The handful of companies that survived those tumultuous first years, however, would one day produce more than a billion pounds of sugar annually.

Governor Pingree had thrown his support behind Public Act 48, legislation that promised bounty money for beet sugar manufactured in Michigan. Its passage sparked a rush to build beet sugar factories all across the state and would according to its supporters, go a long way toward replacing jobs lost by the fast approaching demise of the lumber industry that had been the state’s economic mainstay for fifty years. Michigan had once been a land of white pine forests so dense that in 1812 government surveyors declared it unfit for human habitation. After exhausting the forests of Maine, New York, and Pennsylvania, the lumber barons turned their attention to Michigan’s hundreds of millions of board feet of virgin white pine. Now that it was all but gone the state’s political leaders needed a new source of economic wealth.
The governor and company executives, Thomas Cranage, Benjamin Boutell, Nathan Bradley, men whose fortunes had been garnered in the lumber industry, listened with satisfaction to the factory whistle summoning beets from the storage pits for entry to the first of twenty-three factories where laborers, entrepreneurs, farmers, and politicians set aside natural differences to combine their skills for the common good. It was an idea that had traveled from Europe nearly seven decades earlier.
France developed sugarbeets as a source of white granulated sugar less than one hundred years earlier. Napoleon Bonaparte, after assuming control of France continued the French tradition of threatening England with war. In keeping with his bellicose intentions, he placed an embargo on English shipments and in so doing effectively cut off access to the English ports that France depended on for the transshipment of cane sugar from the West Indies. Sugar stocks piled up on English docks while the people of France suffered for the lack of it.
Until the embargo against English trade in 1806, France met its needs with a continuous supply of cane sugar from Guadeloupe and Martinique in the Caribbean and Réunion in the Indian Ocean. To meet the unsatisfied need created by his embargo and the counter-embargo imposed by England, Napoleon decided to encourage production of sugar from sugarbeets. Experiments ten years earlier had established the viability of the beet root as a replacement for cane sugar. So convincing were the results that representatives of the cane industry offered to pay the modern equivalent of $120,000 to Karl Franz Achard, the scientist most responsible for carrying out the research in return for his disavowal of the possibilities of extracting sugar from sugarbeets. His rejection of the offer not only confirmed his strength of character but also established the foundation of an industry.
By 1812, forty factories were in operation in France. These factories, minuscule by 21st century standards, handled nearly one hundred thousand tons of beets produced on some seventeen thousand acres, and from them, manufactured more than three million pounds of sugar. From France, the industry spread to German, Russia and other countries. In Germany, Achard established a school attended by students from all parts of Europe. When the students returned to their home countries, they carried with them technical information that encouraged the establishment of many more factories. Eventually, Achard’s descendants settled in Michigan where they became involved in the state’s infant sugar industry.
The sugarbeet resembles a turnip on steroids. Its weight varies from three to five pounds. A thick canopy of broad-leaf foliage protects it from the sun. The sugarbeet is a member of the Goosefoot family and has as its cousins, red beets, spinach, pig weed, lambsquarter and Russian thistle and is, more narrowly, of the Beta vulgaris species, which includes not only sugarbeets but also table beets, Swiss chard and mangel-wurzels. Its roots can extend six to eight feet in mellow soil thus can survive climates as varied as those found in Arizona and in Michigan where it enjoys a growing season extending from March to October. The period following the growing season, the period during which sugar is extracted from the beet and then refined, is referred to by the industry as the “campaign”.
Michigan’s inaugural sugarbeet campaign was, by every account, a remarkable success. Farmers harvested an average of 10.3 tons of beets from each of 3,103 acres for a total of 32,047 tons of sugarbeets. The sugar content of the beets averaged 12.93 percent with a purity of 82% from which the factory extracted 5,685,552 pounds of sugar, delivering an extraction rate of 65%.
The farmers signaled their approval when Michigan Sugar Company paid an average of $4.51 for each ton of beets, an amount that immediately classified sugarbeets as a premier cash crop. Happy investors abounded. Public Act 48 assured a profit to the sugar manufacturers by promising to pay a bounty roughly equivalent to one-third of the estimated three-cent per pound manufacturing cost. The manufacturer’s obligation entailed a guaranteed payment of $4 for each ton of beets containing at least 12% sugar and a sum proportionate to $4 for all beets containing a greater or lesser percentage of sugar.
At the projected price of four dollars, no crop in human history had held the potential for creating such a high return from so few acres. A farmer with above average ability who placed fifteen acres in sugarbeets could earn $900 and if his family provided the bulk of the labor, the net profit would more than take care of a family’s needs for a year, which, including food, was less than $800. After adding revenue from crops in rotation such as wheat, corn, and beans, and revenues from milk, eggs, and poultry, the farm family’s standard of living advanced from a subsistence level to one that compared favorably to those who held mid-management positions in industry. Not only did the advent of sugarbeets radically improve the standard of living for those who grew beets but also established its reputation as a mortgage payer. A farmer who grew beets was courted by bankers eager to find reliable borrowers, allowing many farmers to advance quickly from subsistence farming to high income and eventually to the status of wealth.
Official recognition by the United States Department of Agriculture in 1898 of the importance of the sugarbeet industry--combined with success occurring right at home with the initial outstanding results of the Essexville factory, sparked rapid development. One year earlier the nation could boast of only ten beet sugar factories, four of which were in California, one in 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 a rush, one that blossomed into a full-fledged boom by 1900 when the nationwide count stood at thirty beet sugar factories in eleven states.
Nowhere was the blaze hotter than in Michigan where nine factories followed Essexville’s successful experiment. A burst of cyclonic enthusiasm caused a mad scramble when investors, constructors, bankers, and farmers combined energies and skills to bring to life eight factories in a single year! They were in Holland, Kalamazoo, Rochester, Benton Harbor, Alma, West Bay City, Caro, and a second factory in Essexville. In Marine City, investors, inspired by success at Essexville, paid Kilby Manufacturing $557,000 to build Michigan’s tenth sugarbeet factory. Despite the paucity of factory constructors and the engineers to operate them, fourteen additional factories rose on the outskirts of Michigan towns during the next six years, the last of which appeared in Blissfield in 1905. Fifteen years later, Monitor Sugar Company built the state’s twenty-fourth and final beet factory in Mount Pleasant.
In 1898, when ardor flamed at its hottest, enthusiasts shouted the prediction that Michigan would soon resemble a single field of sugarbeets extending from its southern border to the northernmost tip of the Lower Peninsula. Legislators grew alarmed in fear that Public Act 48, designed to spark the development of a new industry, might have instead unleashed a monster that would swallow the state’s budget. They stood by in relieved silence when Roscoe Dix, the state’s Auditor General declared Public Act 48 unconstitutional. The decision, later endorsed by the Michigan Supreme Court, cooled passions for sugarbeets only slightly because the case was strong and after all there was still hope that the United States Supreme Court would reverse the state supreme court’s decision. That effort failed when the U.S. Supreme Court rejected an appeal on grounds of jurisdiction. The court’s decision was not much more than a speed bump in Michigan where mounting excitement for beets brought fresh capital to cities that otherwise faced extinction in the fading light of the lumber industry.
If credit is given to an effort made sixty years earlier, the Essexville factory was Michigan’s second beet factory. By the 1830s, the new European practice of extracting sugar identical to cane sugar from beets had captured the minds of separate but like-minded small groups of investors in Pennsylvania, Massachusetts, and Michigan. The latter group took the name “White Pigeon” after the town in which the company was organized. The Michigan and Massachusetts experiments led eventually to the construction of factories sized to produce salable white sugar in commercial quantities. Those first factories, cobbled together relics of French origin, averaged five tons of sliced sugarbeets per day, an amount processed in less than sixty seconds in today’s factories. Unable to achieve the goal of producing marketable sugar, both failed in 1841.
While it is true that a good idea has many fathers, the Michigan industry recognized one more than any other. That was Professor Robert Kedzie, a legendary chemistry professor at Michigan Agricultural College (later, Michigan State University) and a pioneer consumer advocate who had helped the country end the practice of manufacturing arsenic-laden wallpaper and volatile kerosene. He had originated the idea of the agricultural extension service. He devoted more than fifteen years research to the development of the sugarbeet, eventually earning the sobriquet “Father of the Michigan Sugar Industry” for his steadfast devotion to the belief that sugarbeets would play a vital role in Michigan’s agricultural future.
By 1906, thanks in part to Robert Kedzie and to dozens of town leaders across the state who were willing to accept desperate measures to save their dying communities, the state’s beet sugar industry had evolved into three basic groups that would remain largely unchanged during the next 100 years. The first constituted those factories that experienced a lifespan of fewer than ten years, one of which was Michigan’s first factory at Essexville. The others included four of the eight factories that came into existence in 1899.
Factories in Rochester, Kalamazoo and Benton Harbor plus one in Charlevoix had been built by industrialists who firmly believed in their self-invented axiom that when it came to farmers, “build it and they will come”. The theory failed to blossom into sugarbeets when farmers saw little reason to surrender profitable fruits and vegetables for a product that depended upon a factory to convert farm goods into salable products. The factories failed for want of beets.
Lumber baron Worthy Churchill led a group of investors to the idea of building a 600-ton per day sugar factory directly across the street from Michigan Sugar Company’s Essexville factory, correctly believing that factory’s 350-ton slice capacity made it an easy target for an aggressive competitor. He was right. By 1903, he had persuaded Tom Cranage, Michigan Sugar Company’s president, to merge with his new company. They named the new corporation, Bay City-Michigan Sugar Company, effectively ending the existence of the original Michigan Sugar Company and then began the process of closing down the smaller factory.
In addition to the group of factories destined for brief existence there were seven others that would remain largely independent and survive for an average of 41 years. Chief among them was the Holland factory that by all standards should have gone the way of other undersized 350-ton factories but because of frugal management by Charles McLean, a former school superintendent who possessed the obstinacy of a bear trap, the factory survived 37 years. The Holland factory was the only factory in the United States to shut down operations on Sunday, which it did during its first eleven years at great cost in efficiency but in keeping with the religious convictions of a majority of the community.
Bay City in1899 was still a fast-paced lumberman’s paradise enjoying the last hurrah of timber harvesting while keeping an eye out for a handy replacement. Among the ruins of a decaying industry rose the city’s third beet factory, revealing another example of persistence, one matching that displayed at Holland in terms of lifespan and the will of a single individual to achieve success.
Mendel J. Bialy, a scrappy lumber mill manager, a bookkeeper by training, assembled a group of investors, who like himself had no experience in beet sugar manufacturing. Together they organized the West Bay City Sugar Company in 1898. The investors awarded a contract to Bartlett and Howard, a Maryland iron works company looking for an entry into a hot new industry – sugar manufacturing.
Such was Bialy’s confidence that he determined himself qualified to operate the factory without the aid of technicians schooled in the intricacies of a beet sugar factory. The result was predictably disastrous. The factory achieved a mere 126 pounds of sugar per ton of beet sliced, a 48% extraction rate in an era when factories often achieved 65-69%. Even the Holland factory, where operations ceased twelve hours each Sunday, recorded a higher extraction rate of 53%.
Those who had instigated rumors of imminent abandonment did so without first considering Mendel Bialy’s indomitable spirit. He kept the factory in operation for 38 campaigns on a shoestring budget and the charity of nearby factory managers who came to his aid with spare parts, expertise and patience.
Five additional factories made up the balance of the independents, each with a story like those at Holland and West Bay City where persistence, derring-do, hard work and dedicated artisans gave life to factories that in turn generated economic well-being for townspeople and farmers in equal portions. Four of those factories came into existence in Mount Clemens, Menominee, St. Louis, and Bay City. The new Bay City factory was the fourth built in that city’s environs giving it more beet sugar factories than any city in America. At first operating under the name German-American Sugar Company, it evolved into the Monitor Sugar Company. The fifth was established in Blissfield where a magnificent showplace factory took center stage only to collapse into mediocrity a few years later when its chief sponsor and benefactor, Henry O. Havemeyer, died suddenly of a heart attack.
As 1905 drew to an end, the Michigan beet sugar manufacturing industry began to wobble not unlike a child’s spinning top at the end of a vigorous twirl. Factories that had opened just a few years earlier to the sound of blowing bugles, marching bands and patriotic speeches from political luminaries reposed behind locked gates in mute reproach to the forces that had rendered them so. Seven factories had closed, Essexville and five others situated in Kalamazoo, Rochester, Benton Harbor, Marine City, Saginaw, and East Tawas most often because farmers turned indifferent to the appeals of factory representatives to grow beets. Sixteen beet factories with a combined daily slice capacity of nearly eleven thousand tons remained in business, however.
Despite disasters elsewhere a new company formed, one that would eventually become the sole survivor among the state’s sugar companies. It came about on August 20, 1906 when the Bay City-Michigan Sugar Company struck a deal with Charles Beecher Warren, its principal shareholder and Bay City native, to form a new company, one that borrowed its name, Michigan Sugar Company, from Michigan’s pioneer entrant into the beet industry.
The new Michigan Sugar Company’s balance sheet reflected the assets of six sugar factories located in Michigan. The companies were, in addition to the Bay City-Michigan Sugar Company, the Saginaw Valley Sugar Company in Carrollton, the Peninsular Sugar Company in Caro, the Alma Sugar Company in Alma, the Sanilac Sugar Refining Company in Croswell, and the Sebewaing Sugar Company in Sebewaing. Warren would serve as the company’s president until 1925 when he resigned in anticipation of accepting an appointment by President Coolidge as United States Attorney General. An unusually fractious United States Senate, however, pointing to Warren’s relationship to the sugar industry, rejected the nomination in a narrow vote. Coolidge’s Vice President, Charles Dawes, who could have swung the vote in Warren’s favor, was taking a short nap at the Willard Hotel when the vote was called. He arrived in the Senate chamber too late to change the result. It was the first time since 1868 that the US Senate had rejected a presidential cabinet nomination, ending both Warren’s distinguished public service career and his association with the sugar industry. Previously, he had served as Ambassador to Japan (1922-1923) and Ambassador to Mexico in 1925.
Eighteen years after its founding, Michigan Sugar, in 1924, added two additional factories to the corporate roster when beet sugar factories in Owosso and Lansing joined the company. Twenty-four years later, in 1948, Michigan Sugar acquired the Mount Pleasant factory in a move calculated to acquire acreage allotments mandated under 1948 federal legislation. The factory had been built by Monitor Sugar Company in 1920 and taken over by Isabella Sugar Company in 1933. Members of the Coryell family who under the leadership of Charles Coryell held the controlling interest in Monitor Sugar Company until 1982, also for a time held controlling interest in Isabella Sugar Company. By 1948, the factory had become a derelict, useful only for odd parts and marketing allocations assigned by the U.S. Department of Agriculture, an unfitting end to a company that had successfully pioneered molasses desugarization via ion exchange fifty years before the process gained acceptance in the domestic sugar industry.
With the closing of three factories at Menominee, Blissfield, and St. Louis in 1954, the state of Michigan had only two companies remaining, Michigan Sugar Company that by then was operating four of the nine factories it had acquired, Caro, Carrollton, Croswell, and Sebewaing, while Monitor Sugar Company operated one in Bay City. The two companies would operate in competition with each other for the next half century until Michigan Sugar Company, by then a grower’s cooperative owned by 1,300 sugarbeet growers as of 2002, acquired Monitor Sugar Company from the Illovo Sugar Company of Durban, South Africa on October 1, 2004.
Today, the combined factories, each of them examples of modern extraction technology, possess a beet slicing capacity of 22,000 tons per day (not including Carrollton where production was suspended in 2005) and an ability to produce more than a billion pounds of sugar each year. The sugar arrives at the market place in granulated, powdered, brown or liquid form packed in bags ranging from two pounds to 2,000 pounds or in carloads. In addition, the company markets more than 150,000 tons of molasses and pulp by-products, which combined with sugar products, gives the state of Michigan a significant presence in the domestic food industry. Somewhere, surely, Governor Pingree, who did so much to foster an economic marvel, continues to smile.

Sources:
GUTLEBEN, Dan, The Sugar Tramp-1954- Michigan, Printed by: Bay City Duplicating Co, San Francisco, 1954
HENLEY, ROBERT L., Sweet Success . . .The Story of Michigan's Beet Sugar Industry 1898 – 1974, Michigan Historical Center, Department of History, Arts and Libraries

BINGAY, MALCOLM W., Detroit Is My Own Home Town, The Bobbs-Merrill Company, 1946 (In reference to comments made about Hazen S. Pingree.)

LOCHBILER, DON, The Detroit News, June 11, 1998, The Shoemaker Who Looked Like a King
INFLATION ADJUSTMENTS: The pre-1975 data are the Consumer Price Index statistics from Historical Statistics of the United States (USGPO, 1975). All data since then are from the annual Statistical Abstracts of the United States. Recorded at http://www.westegg.com/inflation
MICHIGAN ANNUAL REPORTS, Michigan Archives, Lansing, Michigan
©2006 Thomas Mahar
About the Author:
Thomas Mahar served as Executive Vice President of Monitor Sugar Company between 1984 and 1999 and as President of Gala Food Processing, a sugar packaging company, from 1993-1998. He retired in 1999 and now devotes his free time to writing about the history of the sugar industry. He authored, Sweet Energy, The Story of Monitor Sugar Company in 2001.
Contact: Thomas Mahar E-mail tkmahar@aol.com

Menominee River Sugar Company 1903-1955

By Thomas Mahar

Menominee, Michigan, situated far from the world's financial centers a hundred years ago, much as it is today, nevertheless placed itself directly in the middle of one of the hottest business booms of 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 that had a cartographer's finger twitched at a crucial moment, Menominee would be in Wisconsin instead of Michigan.

Menominee is bordered on the east by Green Bay, an arm of Lake Michigan, and on the south-west by the Menominee River. In 1903, many investors in the beet sugar industry had a timber background and had thus come to believe that the same rivers that had once delivered logs to sawmills in abundance could also serve the needs of a beet sugar factory where massive volumes of water are used for fluming beets into the factory, washing them and then diffusing the sugar from them. A sugar factory could easily put three million gallons of water to use every twenty-four hours. Barges can carry sugarbeets from the farm fields and freighters can carry products to market. The presence of the Menominee River convinced investors that Menominee could compete with the nation's sugar producers despite negative comments from naysayers who said Menominee was too far north to successfully grow sugarbeets.

The naysayers had a point. Menominee, Michigan is an unlikely place to construct a beet sugar factory. Situated at the western end of Michigan's Upper Peninsula, the growing season is about forty days shorter than the prime beet growing regions in the state's Lower Peninsula. The short season can prevent the ripening of beets which will then lessen sugar content of immature beets ill prepared for the stress of the milling process. Severe frosts in early spring are not unusual and are almost always fatal to a crop of young beets. Frosts can come early in the fall, too, which can make it impossible to harvest a crop. A farmer stood to lose his entire crop either early in the growing season or near the time of harvest after he had invested heavily in bringing the sugarbeet crop to term. Investors, however, in Menominee, as in many of Michigan's cities, tended to discount input from farmers before building a factory and would frequently interpret exaggerated enthusiasm from a handful of growers as representing the broader farming community. Quite often, as in Menominee's case, as it would turn out, the handful did not represent the whole.

Official recognition by the United States Department of Agriculture in 1898 of the importance of the sugarbeet industry sparked the construction of beet sugar factories across the nation. One year earlier the nation could boast only ten beet sugar factories, four of which were in California, one in 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 a rush not unlike the dot-com boom that blossomed nearly one hundred years later. The idea that sugar produced from sugarbeets could compete with sugar produced from 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 than in Michigan where nine factories followed the successful start up of a 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 bring to life eight factories in a single 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 operate them, fourteen additional factories rose on the outskirts of Michigan towns during the next six years, one of which appeared in Menominee in 1903.

In Menominee, a group of investors undeterred by the natural disadvantages and buoyed by encouragement from influential investors and knowledgeable experts, set a plan in motion to maintain the economic viability of their city after the approaching demise of the lumber industry, which had until then provided the underpinnings of Menominee's economy. The plan included the design of one of the largest and most modern sugarbeet factories to appear in America up to that time.

As the lumber era petered out at the beginning of the 20th century, railroads that had come into their own because of timber, sought new sources of revenue. Principal among them was the Detroit and Mackinac Railroad whose land agent, Charles M. Garrison, collected and distributed information about the potential of the sugarbeet industry. While Garrison spread word among Detroit's financiers about prospective profits in sugarbeets, communities affected by the decline of lumber looked to area resources for ways of replenishing wealth. They had plenty to work with. The state was crisscrossed with rail lines and rivers and some left over cash from the lumber era. With Garrison leading the way, investors perked up. Communities eager to find a quick replacement for lumber hastened to attend meetings sponsored by Garrison and quicker yet to bring their towns into the fold. All that was needed was to persuade the farmers to grow 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 in the arm by the visit of Secretary of Agriculture James Wilson, in 1902. He expounded the advantages of sugarbeets and discouraged the notion that the Upper Peninsula's climate wasn't up to the task of producing profitable crops. Wilson served in three presidential cabinets, McKinley, Roosevelt, and Taft, serving longer (1897-1913) than any other cabinet official. He encouraged modern agriculture methods, including transportation and education as they applied to agriculture. His word carried a lot of weight. When he spoke of sugarbeets, some farmers listened and when his department avowed that the cold northern temperatures would not inhibit the development of the industry in their neighborhood, investors, farmers, and manufacturers lined up to begin the industry in Menominee.

Optimism rose to new heights when the United States Department of Agriculture (USDA) announced favorable results of the sugarbeet plot tests. The Sugar Beet News of December 15, 1903, reported test results from beets delivered by approximately 140 farmers. The test runs revealed 15.6 to 19.9 % sugar, which meant a cash value to the farmers per acre of from $5.70 to $7.13 per ton ($135-$169 inflation adjusted to the current period). At those projected prices, no crop in human history had held the potential for creating such a high return from so few acres.

In the Lower Peninsula, a farmer with above average ability who placed fifteen acres in sugarbeets could earn more than $800 and if his family provided the bulk of the labor, the net profit would more than take care of a family's needs for a year, which, including food, was less than $800. After adding revenue from crops in rotation and revenues from milk, eggs, and poultry, the farm family's standard of living advanced from a 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 the other 18 sugar beet factories in the Lower Peninsula.

If the tests proved reliable indicators, Menominee region beets were worth up to $10 more an acre than Lower Peninsula beets, assuring an income of nearly $1,000 per year just from sugarbeets.

Although enthusiasm was on the upturn, something more was needed to seal the deal. To instill confidence in prospective investors that technical expertise lay near at hand, Benjamin Boutell, who won fame as both a tugboat captain and as a captain of industry, arrived in Menominee from his Bay City, Michigan headquarters for the single purpose of conveying interested investors to Bay County where they could see groomed beet fields and efficient factories spinning out white crystalline sugar. Eleven prospective investors accompanied Boutell to Bay City where convincing evidence lay at hand. Four beet sugar factories, more than in any other city in the United States, had been 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 he would become one of the investors, providing the other investors had no objection to having a factory designed and installed by Joseph Kilby who was according to Boutell, the finest constructor of beet sugar factories in the United States. Many others agreed with Boutell's assessment; Kilby built nine of the eventual twenty-four factories built in Michigan. Local investors lined up behind Boutell to organize the Menominee River Sugar Company. A half dozen important backers came forward, each of whom subscribed to more than $25,000 in stock of the Menominee River Sugar Company.

Heading up 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 and their four daughters and one son, in Menominee. He was then seventy-one years of age 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 the 12th District 1893-97). He invested $100,000 ($2 million by modern standards) in the beet sugar factory, taking heart in not only favorable test plot results and the enthusiasm of his neighbors but also interest shown by the American Sugar Refining Corporation, generally known by its then popular sobriquet, the Sugar Trust. Some years later the Sugar Trust would fall into disfavor as a result of charges of unfair business practices, but in 1903, it had the confidence of the general public and investors alike and controlled 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 acquire 36% of Menominee River Sugar Company's stock.

All the members of the board of directors and roster of officers apart from Bay City resident, Benjamin Boutell, listed Menominee as their home of record. Menominee residents made up 74% of the shareholders. Together, they controlled 53% of 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 as a director. Augustus Spies was the second largest investor after Stephenson and the Sugar Trust. He, too, served as a director.

Spies provide 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 and a mild climate allowed the production of grain and wine. He participated in the founding of 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 and several large tracts of forest; he was an investor 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 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 making good business decisions and rising on their own merit rather than inherited wealth, was so great that there was no need to solicit funds from the public at large. With its shares over-subscribed by $35,000, the Menominee River Sugar Company was in the enviable position of having adequate capital for its venture. Not only was it possessed of sufficient capital but also it enjoyed the added benefit of the experience of Benjamin Boutell and representatives of the Sugar Trust. Menominee would not want for technical or business expertise.

Gustave Blesch, like Augustus Spies, owed his success to the inherited qualities of hard work, honesty and 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 an office boy in the Kellogg National Bank of Green Bay, rising to teller by the age of twenty. Five years later, he moved to Menominee to help establish the First National Bank of Menominee where he began as cashier before becoming the bank's president. He became 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 newly elected board of directors approved an $800,000 (nearly $19 million in current era dollars) construction contract for a Kilby designed and built factory that would slice 1,000 tons of beets per day. Of the 48 beet sugar factories in operation in the United States in 1903, only two were larger than Menominee's new factory, one in Salinas, California and another in Fort Collins, Colorado.

The average sugar factory in Michigan in 1903 could slice six hundred tons of beets in a twenty-four hour period. Four thousand acres of beets would easily supply a season's factory run. Had the investors surveyed the farmers first, surely they would have been advised to build a smaller factory, and perhaps would have been persuaded to build none. Farmers delivered beets from approximately 1,500 acres, well short of the 9,000 acres the investment demanded.

The Menominee factory's first factory run (referred to as a "campaign" in the sugar industry) ended quickly, having received only 14,263 tons, enough for a production run of fourteen days for a factory the investors planned to operate at least one hundred days. However, the farmers had submitted beets containing the highest sugar reported of any company during its first campaign, 15.04 percent - about 20 percent more than average and enough to allow for a small profit from a meager beet supply. Like nearly all the factories, records that would inform us of profit, if any, earned during that first campaign, did not survive the passage of time. However, it would be reasonable to estimate, based on the known cost of supplies of coal, coke, limestone and the cost of labor, that a profit of $36,000 was achievable, especially under a management style that paid close attention to expenditures and especially in light of the very high percentage of sugar in the beets.

The second campaign was better with enough beets for a full month, still well short of a supply needed to generate profits enough to justify the investment. By 1911, the local supply reached a level that allowed steady profits but was insufficient to encourage expansion, a condition that persisted until 1926 when grower apathy fell to a level that required closing the factory until 1933 when it reopened for a final run of twenty years during which the factory lagged behind the industry in technology and growth. Year in and year out, because of an inadequate supply of beets, mostly grown in Wisconsin, the underutilized factory ended its campaign weeks earlier than was needed to produce healthy profits which then could have been reinvested in the factory. Menominee investors learned, as did many other sugar factory investors, that the mantra, "build it and they will come" fell on deaf ears among farmers who often displayed a better understanding of sugar economics than did investors.

The passage of time brought neither harm nor good to the Menominee factory as it was unable 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 and a dedicated cadre of farmers.

George W. McCormick, the company's first manager, inaugurated a careful management style that went a long way toward keeping the company profitable despite annual shortfalls in the beet supply. He managed the company during its first thirty-two years of operation, beginning when he was twenty-four years of age. He met Benjamin Boutell in Bay City when he moved there to take a job as a district manager for Travelers Insurance Company. Boutell thought the young man belonged in the rapidly developing sugar industry and encouraged him to help in the establishment of a sugar factory in Wallaceburg, Ontario. After completing the assignment with success, Boutell recommended him for the manager's job in Menominee.

Menominee was the most difficult place in the United States to process sugarbeets. The low temperatures took a heavy toll on workers, machinery and beets that usually went through the slicing machines like boulders, damaging equipment that robbed the factory of slender resources. It was difficult to find replacement parts because of 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 off in 1924 when sugar factories located in Green Bay and Menominee Falls, Wisconsin went on the market. Menominee River Sugar Company purchased both and then invested significant sums in restoring the Menominee Falls factory that had been shut for three years immediately preceding its sale.

The renovated Menominee Falls factory combined with the Green Bay and Menominee, Michigan factories created more capacity than was needed for the available acreage. One of the factories would have to close. Menominee won the noose after the accountants counted up the freight costs for hauling beets to each factory. The Menominee factory remained closed until 1933 when Michigan's farmers relented and agreed to return to sugarbeets, a decision that came too late to save the hides of the sugar company's owners who had lost the company to defaulted bonds three years earlier.

Disruptions in Europe beginning in the 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 to 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 at the age of 81. His brief sojourn in the United States and his U.S. citizenship status, however, would one 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 a naturalized citizen. He planned to raise his family and devote his time to the sugar industry in both the United States and Canada. His plans met with considerable success and by 1954, he controlled the sugar factory in Menominee and the one in Green Bay, Wisconsin.

Despite Albert Flegenheimer's efforts, a lack of interest on the part of farmers kept the factory small and outdated. It struggled year by year until finally in 1955 with its equipment exhausted, its buildings in tattered repair and its farmers pursuing other crops, Menominee River Sugar Company, built on hopes and dreams and operated with fortitude and persistence for more 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, 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, Arts and Libraries

INFLATION ADJUSTMENTS: The pre-1975 data are the Consumer Price Index statistics from Historical Statistics of the United States (USGPO, 1975). All data since then are from the annual Statistical Abstracts of the United States. Recorded at http://www.westegg.com/inflation

MICHIGAN ANNUAL REPORTS, Michigan Archives, Lansing, Michigan
©2009 Thomas Mahar

About the Author:
Thomas Mahar served as Executive Vice President of Monitor Sugar Company between 1984 and 1999 and as President of Gala Food Processing, a sugar packaging company, from 1993-1998. He retired in 1999 and now devotes his free time to writing about the history of the sugar industry. He authored, Sweet Energy, The Story of Monitor Sugar Company in 2001.
Contact: Thomas Mahar E-mail tkmahar@aol.com

The Owosso Sugar Company - A History

By Thomas Mahar

No sooner had Saginaw's lumber tycoon, Wellington R. Burt, celebrated his 70th birthday on August 26, 1901 than did he set out to employ a portion of his lumber wealth in the awakening beet sugar industry.

The mantra of real estate agents everywhere is "location, location, location." However, in the business world in general it should be, "timing, timing, timing." Wellington Burt's timing so far as his interest in sugar was concerned, was poor.

Like others who had filled their days in the once fast-paced but now moribund lumber industry, he had time on his hands and money in the bank. At first, also as had others, he devoted some years to politics. He had served a term in the state senate (1893-1894) then sought a U.S. Congressional seat but had the ill fortune to run as a Democrat in 1900, the year the Republican star was rising. Ranked as one of America's wealthiest men, Burt cast about for new investment ideas and then homed in on the sugar industry. His set his eyes on Owosso, Michigan, a village situated some thirty miles southwest of Saginaw where several holdovers from the lumber industry resided in mansions arrayed along Washington Avenue. Among Owosso's many attributes was the influence of Joseph Kohn, a sugarbeet technologist residing in Bay City, Michigan. Kohn presided over the Michigan Chemical Company which had been put in place to purchase and then process molasses generated by that city's growing number of sugar beet factories. His success at Michigan Chemical encouraged investors to draw close when he spoke of investing in beet sugar factories.

For Kohn it was simple, the more sugar beet factories the more molasses for Michigan Chemical, which could be distilled into alcohol, a circumstance that built enthusiasm for the construction of another factory. Fat with profits, Michigan Chemical and its parent, Pittsburgh Plate Glass, sought to build a factory in Owosso on its own and didn't need the interference of another millionaire with time on his hands and money in his pocket. Wellington R. Burt was not invited to join in a venture with Michigan Chemical and his ambitions to go on his own languished behind a curtain of international events

The United States had agreed upon the conclusion of the Spanish-American War to reduce the import duty on Philippine sugar 75 percent of the general rate and to allow the importation of sugar from Puerto Rico, a U.S. possession, entirely free of duty. The Philippines had the additional advantage of shipping up to 300,000 tons duty free and Congress was dithering with proposed legislation that if passed, would approve a treaty of reciprocity with Cuba. The agreement would grant that country a 20 percent tariff preferential.

The nation’s newspapers devoted considerable space to the plan, dampening the spirits of those who had at first shown much excitement about Burt’s proposed factory. He could find few others to join him in a venture in Owosso, although he pledged $200,000 of his personal fortune and claimed others had subscribed another $50,000 in stock. He had convinced farmers to sign up to grow sugarbeets on three thousand acres and contracted with the experienced firm of Fuehrman and Hapke to begin construction when it fell apart because investors had not come forth with the balance of the required investment – about $600,000.

Michigan Chemical Company waited in the wings while additional investors failed to materialize. Elsewhere, excitement for beet sugar factories hardly slowed. Sixteen were built in the United States between 1900 and 1902, eight in Michigan. Burt's attention turned to Alma, Michigan where he met more success by combining his money and talents with those of Aimee Wright, another Saginaw industrialist.

Owosso, in 1902, was as good a candidate for a beet factory as any town in Michigan, perhaps better. It had rail lines, established industry, a managerial class and trained workers in addition to an excellent farming region. Burt stepped aside, allowing the project to die stillborn. Fuehrman and Hapke went on to construct the Sebewaing factory in the next year, creating one of the most successful beet factories of the era. Michigan Chemical emerged from the shadows and picked up the reins.

Owosso was home to two families with notable achievements in American politics. Both would play various roles in the establishment of a beet sugar factory in Owosso. The Bentley family, headed by Alvin Bentley, whose grandson, also named Alvin, achieved fame at great personal expense in 1954 when as a junior Congressman, he became the most seriously injured of five victims of an armed assault on Congress while it was in session. Four Puerto Rican terrorists discharged thirty rounds from the visitor’s gallery of the U.S. House of Representatives to the floor of that chamber while the Representatives were debating an immigration bill.

The Dewey family had been engaged in Republican politics since the party’s formation in nearby Jackson, Michigan in 1854. In Owosso, in accordance with tradition, a leading representative of the political party then in power held the postmaster’s position. Edmund O. Dewey, uncle to Thomas Edmund Dewey, a future New York governor and twice an unsuccessful candidate for the U.S. presidency, held that position beginning with the presidency of William McKinley and ending with the presidency of Woodrow Wilson. His brother George, the father of Thomas Edmund Dewey, secured the appointment in 1921.

Edmund Dewey, in 1902, revived Wellington Burt’s plan for a beet sugar factory in Owosso. He arranged the purchase of a suitable 40-acre site at the west end of Oliver Street, raised $10,000 and urged the county board of commissioners to pass a bond issue sufficient to meet the cost of the land. The county denied the bond, causing the idea to fail for a second time and for the same reason – a lack of enthusiasm.

Joseph Kohn stepped forward and in doing so introduced into Michigan's fired up sugar industry one the nation's wealthiest families, the Pitcairn family of Pittsburgh, Pennsylvania. The Pitcairn family controlled the Pittsburg Plate Glass Company (today known as PPG Industries) headquartered in Pittsburg, Pennsylvania. The glass company had all but ended America’s dependence on Europe for large sheets of glass suitable for storefronts, display cases and mirrors. During the opening days of the 20th century, the company produced 20-million square feet of glass annually.

In seeking a source of potash for its glassworks, Pittsburgh Plate Glass turned to Kohn who made an effort to extract it from beet sugar molasses and instead found he could earn assured profits by converting molasses into alcohol. He had also served the German-American Sugar Company (later named Monitor Sugar Company) as a consultant and before that held a similar position with Kilby Manufacturing who was much involved in turnkey beet sugar factory construction projects. Kohn’s Bay City distillery, owing to the large volume of molasses emerging from three sugar factories and more promised from the German-American Sugar Company’s factory then under construction, was turning over substantial profits to Pittsburgh Plate Glass.

John Pitcairn saw America’s shores first as five-year old immigrant brought to America by his parents John and Agnes along with two sisters and a brother. Pitcairn accumulated a personal fortune in railroads, coalmines, oil, and in the founding of the Pittsburgh Plate Glass Company in partnership with John Ford. He was sixty-years old when Kohn drew his attention to the potential in Owosso and the failed effort of first Wellington Burt, then Edmund Dewey to form a beet sugar company.

Three’s the charm for Owosso. On October 29, 1902, the Owosso Sugar Company came into existence, capitalized at one million dollars. More than 75 percent of the shares were owned by members of the Pitcairn family and friends. John Pitcairn owned 62,500 of the outstanding shares outright. A handful of Owosso residents added their names to the shareholder list, including the aforementioned Alvin Bentley and the brothers Edmund and George Dewey. George Dewey’s son, Tom, the future presidential candidate, would one day spend school vacations working in the new sugar company’s packaging room.

The company presidency was turned over to Charles W. Brown, the owner of newly minted 5,600 shares of stock. Brown was also the president of Pittsburgh Plate Glass. Day to day financial duties went to 36-year old Edward Pitcairn, one of John Pitcairn’s many nephews. Edward would, by 1910, become treasurer of Pittsburgh Plate Glass, a position he would hold for the balance of his career. Carmen Smith, an attorney with a long association with Charles Brown, stemming from a period when the pair resided in Minneapolis, assumed responsibility for the general management of the new firm. In addition, he assumed the title of Secretary-Treasurer. He had recently moved his wife Isabella and three children, Margaret, Carmen, and Cedric to Bay City where he served as the treasurer of Michigan Chemical Company. Joseph Kohn accepted the role of general factory superintendent.

Educated at the Prague Institute of Technology, Kohn graduated in 1883 with degrees in mechanical and chemical engineering. Following his schooling, he was employed at Breitfeld-Danek of Prague and later gained experience at a sugar factory in Moravia, a region in what is now the Czech Republic but was then a part of the Austrian-Hungary empire, and also worked with the evaporator designer, Hugo Jelenik. In Moravia, he worked with Carl Steffen, the inventor of the molasses desugarization process that carries his name. While employed by Kilby Manufacturing Company, Kohn developed the Kilby standard factory arrangement.

Kilby Manufacturing won contracts to construct two 1,000-ton factories in Michigan; one at Owosso and another at Menominee. The two would hold the record as the largest beet factories built in Michigan until a 1,200-ton factory was built at Mount Pleasant in 1920. In addition to the two 1,000-ton factories, Kilby had an order for a standard 600-ton factory for East Tawas. It would be a busy year for Kilby who had also received orders for three factories in Colorado, one each for Fort Collins, Longmont, and Windsor with Fort Collins gaining the largest factory built by Kilby-1,200 tons a day slicing capacity. The price for the Owosso factory, at $675,000, on a per ton of sugarbeets sliced basis, was low at $675 compared $1,197 at East Tawas and $785 at Menominee. In fact, the Owosso factory cost less per ton of slice than any factory built in Michigan.

The Owosso factory came to life on December 9, 1903 without the usual fanfare assigned to new beet sugar factories which usually included marching bands, parades, and much merriment followed by speaking opportunities for local luminaries and politicians. In a quieter fashion, Charles W. Brown, arrived from Pittsburgh and brought with him as an honored guest, James Wilson, the Secretary of Agriculture. He rose to national prominence when President William McKinley appointed him Secretary of Agriculture in 1897. His stature was such that presidents Roosevelt and Taft retained him as secretary, and it was only when in 1912 in a move to sweep Republican appointees from office, Woodrow Wilson ended his tenure. He had served as Secretary of Agriculture from March 4, 1897 to March 3, 1913, the longest duration served by any American cabinet official.

After a brief ceremony, Secretary Wilson pulled the whistle cord that called forth the beets from the flumes. Unlike many of the beet factories built in Michigan, there was no central local figure that had put his money and reputation on the line for the factory. The majority ownership was far away in Pennsylvania, its officers and guiding management lived elsewhere, Bay City in the case of Joseph Kohn and Carmen Smith and the environs of Pittsburgh for Brown and Pitcairn. It was not unusual for absentee owners to overlook the obvious – input from farmers. When a lack of farmer interest made itself known, it caused no palpitations in the boardroom of Pittsburgh Plate Glass. After all, twenty years earlier John Pitcairn had forged a new American industry out of the rubble of similar but failed efforts when he wrestled the plate glass market away from the Europeans and developed one of the world’s largest and most modern factories of its kind.

Farmer apathy was a mild inconvenience, not a crushing blow to someone who had turned the making of plate glass into a unique American industry. The answer lay near at hand and Carmen Smith, his appointed emissary, had probed the possibilities even as the factory walls reached toward the sky to the amazement of Owossians who had gathered on weekends throughout the summer of 1903 to take in the breadth and dimensions of the industrial goliath growing in their midst. Clearly, the Pittsburgh Plate Glass people thought big. They thought even bigger than the factory’s sidewalk superintendents imagined, bigger than had any beet factory organizer up until that time. Not only were they building a beet factory destined to be twice the size of nearly all the sugar factories in the United States, they were at the same time on the verge of establishing the largest sugarbeet farm in the United States and the largest single farm operation east of the Mississippi River.

South and west of Saginaw, Michigan lay a vast marsh formed during the last ice age. The marsh adjoined the convergence of several large river systems that became the Saginaw River that then and now flows 22 miles northward to Lake Huron. The eighteen thousand acre marsh served as an important stopover point and brooding ground for migrating waterfowl, ducks, geese, swans. It was the largest natural wildlife habitat in the American Midwest. It was protected by characteristics that made it unappealing to farmers – frequent flooding. But that changed when Harlan B. Smith, a Saginaw buggy manufacturer who also speculated in real estate, entered into a partnership with two attorneys Charles H. Camp and George B. Brooks, to acquire and then develop approximately 10,000 acres of the marsh. Their efforts, spanning fifteen years, resulted in a large drainage ditch that extended nearly two miles across the prairie, permitting them to convert hundreds of acres of marsh into farmland.

When Carmen Smith searched for a large tract in which to install a demonstration sugarbeet farm while at the same time assuring the Owosso factory would have all the beets it would want, he quickly targeted the Prairie Farm. Smith completed the purchase on February 22, 1903 and soon, a steam-powered dredge, a monster designed for digging into mucky earth, was soon barged down the Saginaw River to the prairie. It bit into the earth in the front, forming a 20-foot high dike and creating a canal, which it used to transport itself until acre-by acre, it claimed land that had waited a half a million years for the arrival of the mechanical behemoth.

Eventually, Owosso Sugar Company created thirty-six miles of dikes, some of them eighty feet wide at the bottom, forty at the top and twenty feet high. Others were of lesser dimensions but all designed for the same purpose – draining and then keeping the land dry. Roads crowned the tops of the dikes and the sides turned to grass for use as a sheep pasture. Half the land was drained via open ditches and half was drained with the aid of large pumps that sent their burden to the nearby Flint River. Once it was dry, the reclaimed land was laid out much like a giant checkerboard in twelve lines of sixteen forty-acre parcels. Almost overnight, for a capital outlay of $400,000, Smith transformed the Prairie Farm from a losing proposition into the largest beet sugar estate in Michigan, and probably in the United States, if not the world – ten thousand acres. The new factory could now set aside worry about an adequate supply of beets.

Owosso Sugar Company’s First Campaign

The first operating campaign for the Owosso Sugar Company, as was customary with Kilby designed turnkey factories, achieved the guaranteed slice rate of 1,000 tons of sliced beets each twenty-four hours. Construction contracts typically required that a new factory meet its guaranteed rate for a specified period of time, set by negotiation, at between one and ten days and usually occurred under the supervision of Kilby’s engineers some days after the startup. The same engineers would withdraw once the new owner signed the certificate of completion, handing the factory over to the company’s management staff. The slice rate at Owosso declined after the factory reached the guaranteed rate most likely for the same reasons slice rates in most new beet factories declined – inexperienced operators.

Because the Prairie Farm was yet in its infancy, it produced fewer beets than it would in the following years causing the processing period, referred to as a "campaign" by the industry, to last only 48 days, ending on January 26, 1904. During its maiden run the new factory sliced an average of 542 tons, well short of the scheduled 1,000 tons per day. The second campaign was five days shorter but the slice rate nearly doubled, reaching 930 tons per day for 43 days.

While the Owosso factory was under construction, the Lansing beet factory, built by Benjamin Boutell, a major investor in several Michigan beet sugar factories, and others two years earlier, suffered from a lack of managerial oversight. Diagnosed with cancer early in 1902, Boutell’s wife, Amelia died on November 27 at the age of 52 despite his best efforts to discover a cure. Having no heart for his business interests, he sold the Lansing factory to the Owosso Sugar Company.

Kohn and Smith now had four major operations: two sugar factories, the Prairie Farm, and Bay City’s Michigan Chemical Company under their control whereas one year earlier they had only the chemical company to occupy their time and thoughts. The Prairie Farm employed 160 workers and 58 teams of draft horses and each of the two beet factories employed hundreds more in addition to workers at the chemical factory and in the Bay City headquarters. The two managers, each 45 years old, were in constant motion, visiting the properties, the corporate office in Pittsburgh, and attending industry conventions in addition to meeting with members of Congress and the Department of Agriculture. In 1910, Joseph Kohn was the first to reckon the cost of such a pace. He suffered a heart attack and died at the age of 52.

In the year preceding Kohn's death, 8,500 Prairie Farm acres had been diked and equipped with gravity drainage and pumping systems and for the first time, grew a square mile of sugarbeets. Peppermint provided additional revenue (35,000 pounds of peppermint oil in 1909) while cabbage followed in importance behind sugarbeets.

For the six years following Kohn’s death, Carmen Smith continued on as before, shouldering Kohn’s responsibilities in addition to his own, until 1916 when he placed the two sugar factories under the supervision of Charles D. Bell who had served as the factory manager at Alma before joining the Owosso staff in 1907. Bell remained at Owosso for sixteen years, leaving only after Michigan Sugar Company acquired the Owosso and Lansing factories in 1924 whereupon he returned to the family ranch in Los Alamos, California where he promptly discovered oil and retired in wealth.

In 1920, at age 62, Carmen Smith, much like his friend and associate, Joseph Kohn, succumbed suddenly to a heart attack while traveling home by train from Chicago. With Carmen Smith passed a pioneering era. Joseph Kohn in 1910, Joseph Kilby in 1914, John Pitcairn in 1916, and Carmen Smith in 1920 - those who had lived the dream of building one of the world’s largest and most modern beet sugar factories and then topping it with the country’s single largest beet farm, had passed from the scene. Sadly, what they had wrought would not last.

According to Daniel Gutleben’s history of the Michigan beet sugar industry (The Sugar Tramp -1954), Pittsburgh Plate Glass, likely concerned that Michigan’s beet factories, built too small to compete with major refineries designed to process raw sugar imported in quantity, couldn’t compete against the volume of duty-free sugar entering the country. It opted to sell both the Owosso and Lansing factories to Michigan Sugar Company at a price reported in the press at $2,000,000 plus preferred stock. The Prairie Farm remained in the hands of John Pitcairn’s heirs.

Michigan Sugar Company operated Owosso for the next four years until diminishing interest on the part of farmers combined with the flood of imported sugar caused the factory to close in 1928. Michigan Sugar lacked the chief advantage once held by the former owners - the Prairie Farm thus could not command farmers to grow beets when other crops, corn and soybeans attracted favorable prices for less investment and less work. It re-opened again for one year in 1933, then shut down but was kept in hopeful readiness. Hope finally surrendered to reality that the farmers would not return. The factory and buildings were sold in 1948. Proof that the eventual failure of the Owosso Sugar Company did not rest upon the shoulders of management lay in the appointment of Owosso's secretary, Edward Bostock, to the chairmanship of the board of directors of Michigan Sugar Company.

Sources:

DENSLOW, William R, and TRUMAN, Harry S., 10,000 Famous Freemasons from A to J Part One (in reference to Charles W. Brown career with Pittsburgh Plate Glass Company)

MILLER, Ed, and BEACH, Jean R.., The Saginaw Hall of Fame, Published by the Saginaw Hall of Fame, 2000. (In reference to Wellington R. Burt)

GUTTLEBEN, Daniel, The Sugar Tramp – 1954 printed by Bay Cities Duplicating Company, San Francisco, California

LE CUREUX, KEITH, Albee Township History, Saginaw, County, Michigan, Chapter V, Prairie Farm.

BETZOLD, Michael, Detroit Free Press Magazine, December 26, 1993, Utopia Revisited – an article describing the history of the Prairie Farm.

Copyright, 2009, All Rights Reserved

About the Author: Thomas Mahar served as Executive Vice President of Monitor Sugar Company between 1984 and 1999 and as President of Gala Food Processing, a sugar packaging company, from 1993-1998. He retired in 1999 and now devotes his free time to writing about the history of the sugar industry. He authored, Sweet Energy, The Story of Monitor Sugar Company in 2001, and Michigan's Beet Sugar History (Newsbeet, Fall, 2006).Contact: Thomas Mahar E-mail tkmahar@aol.com

Caro, Michigan – The Town That Would Not Be Left Behind

A History of the Nation's Oldest Surviving Sugarbeet Factory

By Thomas Mahar

Michigan's lumber industry and the 19th century drew to a close together. Lumber barons had swept through the state like a hurricane, much as they had done in New England and New York, carting away the world's last great stand of white pine forests. In their wake lay dying towns, hundreds of miles of combustible debris, erosion-made swampland and wonderment on the part of those left behind that they had traded their heritage for a handful of bright coins. Lumber towns across the state, one of them, Caro, named for some inexplicable reason after Cairo, Egypt, faced extinction.


If a town was to have an even chance of finding a place in the 20th century then it needed an industry. Town mayors and other leaders across the state cast about for one. In Caro, talk about sugarbeets had drifted from Bay County where an entrepreneur named Thomas Cranage constructed a sugar factory in Essexville, a suburb of Bay City, another lumber town searching for an economic foothold to replace lumber. The results of Cranage's experiment sparked enthusiasm that quickly replaced the gloom that had settled into the hearts and minds of the leaders of faltering lumber communities.


Cranage traveled to Nebraska, Utah, New Mexico, and California where he witnessed the process and talked to the technicians and then hired them. He then created Michigan Sugar Company and, avoiding the mistake of many entrepreneurs, saw that it had adequate capital to survive the disappointments that so often accompany new ventures.


Michigan Sugar Company benefited not only from good planning but from good weather. The first sugarbeet harvest and processing season (called a "campaign" in the parlance of the beet sugar industry) in the state’s history was, by every account, a remarkable success. Farmers harvested an average of 10.3 tons from each of 3,103 acres for a total of 32,047 tons of sugarbeets. The sugar content of the beets averaged 12.93 percent with a purity of eighty-two percent from which the factory extracted 5,685,552 pounds of sugar. A sugar content of 12.93 percent meant each purchased ton of beets contained 258.6 pounds of sugar. From that, the new sugar factory packaged 169 pounds, which equated to total sugar recovery of sixty-nine percent, an excellent result for a first campaign.


Principal among leaders in Caro, the center of business activity for Tuscola County, was Charles Montague. The town waited to learn what Mr. Montague thought of the sugar talk.

Montague was fifty-two years old when Michigan began to open its eyes to the prospects of sugar. He had already achieved success in many fields including banking, farming, lumber milling, merchandising and manufacturing. In addition to owning and operating the town’s hotel, he operated the local telephone system and electric lighting company.


If a sugar factory was going to be built in a town, it needed a prominent citizen to get on board, someone’s whose participation would create a groundswell of enthusiasm – enough to shake dollars loose from hidden places – enough to cause farmers to favorably consider raising beets that could make townsmen rich. As it would turn out, Caro was one of the few Michigan communities that did not need to generate investment from within the community. In Detroit, ninety miles to south, eager investors searched for ripe opportunities and closer to home in the nearby town of Vassar, lived a man whose roving eye never ceased to search for opportunity.


Richard Hoodless lived in comfort in Vasser, a small city named after Mathew Vassar, the founder of Vassar University. He had for many years traveled Europe’s roads as a buyer of agricultural products for an English concern. He saw his first beet fields in Germany twenty years earlier, saw prosperous factories perched near towns, factories that hired laborers, purchased supplies and paid taxes to local governments and generally caused a rising tide of sustained prosperity in which no citizen directly or indirectly was denied a chance to dip into the treasure-trove formed out of beet fields.


Hoodless looked for ways to duplicate the success of Germany’s farmers. As luck would have it, an advertisement appeared in a Chicago newspaper, placed by August Maritzen, a youthful architect, recently married, who had taken time out from his honeymoon to promote business for a manufacturer in Germany whose name could be pronounced by most Americans only if they first filled their mouths with marbles. It was A. Wernicke Maschinenbau Aktiengesellschaft of Halle, Germany. Hoodless replied to the advertisement and in return, Maritzen offered the significant sum of $4,000 (more than $80,000 in modern dollars) if Hoodless could generate enough interest to establish a factory in Caro.


On one hand, Hoodless had in Charles Montague, a man of wealth who dearly loved both opportunity and technology as evidenced by his control of the local telephone and lighting companies, new shining hallmarks of late 19th century technology, and on the other, in Wernicke, an experienced factory builder eager to construct a factory in the United States. For help, he turned to two friends, Fred Wheat linked to the Montagues by marriage for many years, and John Wilsey. Wheat was a lawyer whose wife was Maria Montague, a sister of Charles Montague.


Hoodless then assembled a citizens committee that became the predecessor to the Caro Sugar Company. A member of the committee, Fred Slocum, also served as editor of the Tuscola County Advertiser and helped promote the idea in his news columns. Farmers in Caro’s neighborhood, aware of the great excitement occasioned by the Essexville experiment signed on as did Charles Montague and his associate, banker John Seeley who had earned his spurs in coal mining. He served as the vice-president of the Sebewaing Coal Company; an organization headed by Spencer O. Fisher who also was involved in Essexville’s Michigan Sugar Company and would later become president of the West Bay City Sugar Company.


Once Montague picked up the ball, he ran for the end zone without considering competitive quotes for factory construction. Indeed, it was Wernicke representative, Max Schroeder who joined Montague and Seeley on an excursion to Detroit on a January evening in 1899. The night was blistering cold; the deal in the making was hot. The great fear was that some other town would beat Caro to the punch, drawing investment dollars away from Tuscola County. Time was of the essence.


For one week, the town held its breath as the trio met with important financiers in Detroit. Daniel Gutleben, in his The Sugar Tramp-1954 reported the receipt of a telegram by the organizing committee at Caro announcing that investment capitalists had invested in the factory and had awarded Wernicke the contract for its construction. Pandemonium “reigned supreme” according to the Tuscola County Advertiser. Seeley arrived alone on Tuesday’s evening train with a story to tell, one that lives yet in Caro’s memory, passed down by each succeeding generation and recorded in Daniel Gutleben's chronicles. It is a story that reveals how Charles Montague persuaded some big city wheelers and dealers into investing heavily in Michigan's second beet sugar factory.


No one questioned Wernicke's ability to build a factory four thousand miles from its base in a foreign country where the language, customs and economic conditions differed significantly from the home country. There was no one on the board of directors who possessed any experience whatsoever with beet sugar factories nor did the board foresee a need to engage corporate officers possessed of such experience. After all, Wernicke was the sugar expert, claiming more than 200 projects, including one just completed in Australia. It also did not matter because Wernicke, with enthusiasm running amuck, signed a contract guaranteeing the new factory would slice 500 tons of beets each day for a least thirty successive days at a cost of three cents per pound for sugar currently selling in Chicago for six cents per pound, retail.


That a new factory, even one built by someone lacking the disadvantages of building a factory in a foreign land, could operate at 500 tons per day during its maiden voyage was unheard of. Inevitable construction problems always created delays; fine-tuning would deter full slicing capability for weeks, sometimes months. Added to the mix were factory crews more accustomed to walking behind plows or knocking down trees with axes than operating boilers, engines, diffusers, vacuum pans, and evaporators all in perfect harmony. A year earlier, the Essexville factory builders had missed its guarantee to produce sugar for three and one-half cents per pound by fifteen cents and paid for it with a costly out of court settlement, a fact either unknown by Wernicke or dismissed in a moment of unwarranted confidence. Further, Wernicke agreed to finance $300,000 of the estimated $400,000 construction cost.


For Caro and its Detroit investors, it was too good a deal to pass up. It got better as time went on. The village council, as an added inducement, purchased 100 acres of land in two parcels, one of which belonged to Charles Montague, and gifted it to the factory owners, one of whom was Montague. The Caro Water Company sweetened the deal when it offered, free of charge, up to 500,000 gallons of spring water daily.


Thus did Caro, as a result of Montague’s energy and Hoodless's ambition and the will of a town that would not be left behind, find itself the beneficiary of a factory largely paid for by outside investors. Foregoing the original name, The Caro Sugar Company, the organizers formed the Peninsular Sugar Refining Company on January 30, 1899 with 30,000 shares with a par value of $10. By August of the same year, the capitalization jumped to $500,000 and jumped again in February 1902 when it climbed to $750,000. Its final increment occurred in September 1902 when it advanced to an even one million dollars – 100,000 shares at $10.00 par value.
The moneymen included Detroit industrialists Charles Bewick who a few years later invested in the East Tawas sugar factory and Henry B. Joy, who in 1905 became president of the Packard Motor Car Company. Joy and members of his family invested in a number of Michigan’s sugar factories, including those at Alma, Croswell, and Bay City. His brother-in-law and a co-founder of the Packard Motor Car Company, Truman Newberry, invested in Caro, as well, and along with Joy, became one of the company directors. Newberry would in 1918 catch fleeting fame as the successful bidder for a U.S. Senate seat for Michigan, defeating Henry Ford, another magnate who sought the same post. (Newberry fame lasted longer in Michigan’s Upper Peninsula where they named a town Newberry to commemorate his father’s thoughtfulness in chopping down all the hardwoods he could find and turning them into charcoal.)


David Cady and Gilbert Lee, owners of a large wholesale food distributorship in Detroit, controlled between them, nearly five thousand shares. Gilbert Lee moved into the president's chair while Henry Joy settled for a vice-presidency.


Within a few years the Sugar Trust came to town and everything changed. The American Sugar Refining Company referred to everywhere in newspapers as the Sugar Trust, moved into Michigan in 1901 and 1902 and began absorbing beet sugar factories at a rapid pace. Gone now was Charles Montague whose energy and drive assembled the parts that made the company. Gone, too, was John Seeley, his friend and partner. Richard Hoodless, who started it all, never made it to the stockholder list.


By 1903, the shareholder's list reflected some of the top names in the Sugar Trust. Chief among them was Charles B. Warren, legal counsel to the American Sugar Refining Company, whose 22,001 shares topped the 1904 shareholder list. The second ranking shareholder was Thomas B. Washington of Boston, Massachusetts, a director of the American Sugar Refining Company who held 15,667 shares. He would rise to the presidency of the Sugar Trust four years later upon the death of Henry O. Havemeyer, its founder. Third was Lowell Palmer, an executive with the American Sugar Refining Company who held 10,126 shares. Together, the three controlled 48% of the Peninsular Sugar Refining Company. An interesting feature of the shareholder list was the absence of the names of Caro residents except for a few latter day residents, employees of the sugar factory.


The American Sugar Refining Company, vilified in the daily press for its monopolistic tendencies and harried in federal courtrooms for perceived violations of the Sherman Antitrust Act of 1890, was held in high regard by its 13,000 shareholders who enjoyed a steady stream of dividends, 12% per annum since 1894. An under-appreciated aspect of the Sugar Trust was that it demanded that companies under its jurisdiction produce products of high quality at low cost and to that end provided expert advisors who traveled from factory to factory dispensing technical information, overseeing training and staffing, and inspecting the facilities.


But in 1899, the village of Caro's interest lay, not in the realm of high finance or corporate philosophy but in the hundreds of workers in need of boarding, food, and clothing and other necessities and luxuries that caused cash registers to ring all about the town. Men, money, equipment, and building materials poured into the hamlet. Forty-eight carloads of equipment plus six million bricks and one thousand cords of stone arrived in rapid succession. Three hundred workers, including bricklayers who earned fifty-cents an hour compared to fifteen cents for common laborers and five cents for apprentice electricians, created a buzz of activity that began when the snow melted in April and ended October 23 when Superintendent Georg Bartsch, a noted expert in sugar manufacturing with special acclaim won for expertise in crystallization and vacuum pan operation, declared the factory ready for operations.


Performance guarantees for new beet sugar factories plagued those who dared to issue them—and would soon plague Wernicke. The factory as described by Gutleben, while eschewing some American preferences in terms of materials, nevertheless represented the foremost in factory design. It possessed four quadruple effect evaporators made of wrought iron, supplying a combined 8,911 square feet of heating surface, two pans each 9-1/2 feet in diameter x 13 feet high containing 753 square feet of heating surface, and centrifugals that used steam jets for the final washing of the sugar. Six 700 cubic-foot spray-cooled vacuum-filled crystallizers installed on the pan floor expedited cooling, a modern feature that improved throughput. Nine water-tube boilers fitted with mechanical stokers provided an adequate supply of steam. A concrete floor, a luxury according to Michigan factory standards of the day, separated the factory from the mud and clay that lay beneath.


Two significant differences between a factory of American design and one of German design caused some immediate rancor. The first was that American management style called for superintendents who inspired the invention of the phrase, “manage on your feet, not on your seat” while the German method called for a field marshal who commanded from afar, sending lieutenants forward to collect information and to dispense managerial wisdom and dictates.
In addition, the European method of management called for much secrecy between management and the managed and in addition, technicians reserved their knowledge to themselves, sharing what they knew only with sons or those who paid handsomely for instruction. The departmentalized factory fit the European management style perfectly. For that reason, the Caro factory consisted of a number of separate rooms, or departments, the effect of which encumbered communication and increased the number of laborers required to operate the factory. Messengers scurried between rooms delivering orders and information, not always as timely as circumstances required. The arrangement, in later years, would make it difficult to expand the factory; expansion of one area generally occurred at the expense of another. Kilby-built factories, those constructed by Joseph Kilby of Cleveland, Ohio, considered by many the premier constructor of sugar factories, conversely, provided sufficient space that during two and more generations of successive development allowed for five-fold enlargement of capacity with only minor additions to the structures or foundations.


Wernicke’s record from the standpoint of practicality and fairness, however, was outstanding. Between March 1, 1899 and October 23 of the same year, the German company had shipped a good portion of the factory from Germany. It then arranged for the design and construction of a complete operating facility in a relatively new industry in a foreign country in just under seven months, becoming the first of eight beet sugar factories constructed in Michigan in 1899 which then made it the second such factory built in Michigan after Essexville's. By standards existing in 1899 and more than one hundred years later, Wernicke’s accomplishment stands as a monumental achievement. Other than ordinary upsets, the factory had operated as well, and in some cases, better than any start-up that took place that year. Because of the loss of records, specifically, the sugar content of the processed beets, the results of the first campaign can only be estimated. Nearby Bay City reported sugar content of thirteen percent and eleven percent was reported elsewhere in the state. Applying an average of twelve percent, then, to the crop received at Caro, indicates the new factory recovered 66 percent of the sugar in the beets, comparing favorably to the 61 percent recovered at Benton Harbor but short of Alma where recovery reached 72 percent.



However encouraging the results may have been, the simple fact was Wernicke failed to achieve three conditions spelled out in the contract, failures that would result in a hurried walk to the woodshed. First, the factory did not slice 500 tons per day for 30 consecutive days, as guaranteed. Secondly, cost exceeded three cents per pound, and third, the factory was not ready to accept beets on September 1, 1899, as promised. Also, according to the company, the sugar produced lacked salability and much of it was lost in the process. It was then that Wernicke learned the litigious nature of Michigan’s pioneer sugar manufacturers.
It may have been possible that the company would have relented somewhat in consideration of Wernicke's exceptional effort except that the directors contemplated operating losses because the State of Michigan decided to withhold payment of a promised bounty on any sugar produced after January 1, 1899. The bounty provided payment from the state treasury of one cent for each pound of sugar produced in Michigan from sugarbeets but had been declared unconstitutional by the Auditor General, a decision later upheld by the state supreme court. The decision represented a disaster to investors because one-cent equated roughly to one-third of the operating costs. The United States Supreme Court declined to consider the case, giving rise to the mistaken belief that the decision upheld the lower court's decision. The unremitted bounty money amounted to $40,436; a much needed offset to an approximate $65,000 loss.


When it came time to take Wernicke to court, the company directors chose as their legal advocate, Charles Evans Hughes, a brilliant jurist destined to become the Chief Justice of the Supreme Court. In preparing for his day in court with Wernicke, Hughes learned the German language and the beet sugar industry from the ground up to enable him to cross-examine German engineers appearing as expert witnesses. According to James Howell, a former Caro factory superintendent who authored a detailed account of Caro’s factory history, Hughes spent a month at the Caro factory exploring every nook and cranny until he became expert in its design and function.


The ensuing court case, according to Gutleben, resulted in a forfeiture of the $300,000 bond underwritten by Wernicke, seventy-five percent of the contract price, causing Wernicke to withdraw altogether from constructing sugar factories in the United States. Howell, writing six years before Gutleben, gave a slightly altered account. He related that Wernicke remitted $150,000 and forgave $125,000 still due on the construction contract.


Shortly, Oxnard Construction Company appeared in Caro to affect changes to the factory, none of which were material in terms of the original construction. American made centrifugals, these by the American Tool Machine Company, often called “Amtool” in the industry, replaced those of German design. One major change had nothing to do with defects in the original design. It was the addition of the Steffen process for removing sugar from molasses. A chief problem of the era was the high ratio of sugar that escaped the manufacturing process and ended its days mixed in with molasses, the gummy syrup left over from the manufacturing process.

The second year’s financial results were impressive. The new centrifugals and Steffens process (called the Steffen's House in the industry) proved their worth. Seven million pounds of sugar passed through the storehouse, the product of thirty-two thousand tons of sugarbeets that contained 14 percent sugar. The factory extracted 243 pounds of sugar from each ton of sugarbeets, a 35 percent improvement over the first year. The new Steffen process had not only recovered sugar from the approximate twenty tons of molasses produced each day but also recovered sugar from molasses left over from the previous crop.

Henry Oxnard founds a management dynasty at Caro

Henry Oxnard did more than merely redesign a factory when he applied his efforts to the problems then existing at Caro; he founded a management dynasty that would permanently influence not only the Caro factory but also the fledgling U.S. beet sugar industry. Nearly ten years earlier, in 1891, Henry Oxnard had recruited from Germany and France some of the finest and best educated technicians of the day who after arriving in America formed the nucleus of a cadre that would set about to train Americans in the production of sugar from beets.

Having formed his first-tier of management, Oxnard then proceeded to provide for the mechanical engineering department. For overall construction management responsibilities, he turned to A. P. Cooper who had served at the pioneer Ames, Nebraska factory in the capacity of assistant engineer. Cooper promptly surveyed the Caro factory and set in motion a plan to affect change, putting to work a duet of draftsmen that had accompanied him to Caro. One was Daniel Gutleben who would one day rise in the ranks of premier factory operators and still later, as the chronicler of the beet industry’s history.

With the two top tiers firmly in place, Oxnard then saw to the placement of a group of promising laborers who lacked adequate training but who could perform with a high degree of satisfaction if given proper tutelage.

Charles Sieland, a thirty-six year old native of Germany employed by Oxnard to oversee the changes, disavowed his countrymen’s tendency to withhold information except for financial reward. He adopted Henry Oxnard’s philosophy of sharing information. Caro, in his mind, was not only a factory but also a university. A long roster of factory technicians and managers began their careers at Caro under his tutelage and then carried their shared knowledge to others when they moved from factory to factory. One of them was William Hoodless, son of the same Richard Hoodless who had started the ball rolling for gaining a factory in Caro. Within a few years he held responsibility for all factory operations and not long afterward accepted the presidency of the Pennsylvania Sugar Refinery in Philadelphia.

In 1906, the Sugar Trust consolidated most of its Michigan holdings into one company, the Michigan Sugar Company, reviving the name of the first company to construct a sugar factory in Michigan. The new Michigan Sugar Company included the Alma Sugar Company, Bay City-Michigan Sugar Company, Peninsular Sugar Refining Company, Carrollton Sugar Company, the Croswell Sugar Company, and the Sebewaing Sugar Company. At the time, the Trust through nominee shareholders held a majority interest in the Blissfield Sugar Company built a year earlier in 1905, and the East Tawas Sugar Company, a company, while failing as a business venture in 1904, was in possession of a fine Kilby-built factory the Sugar Trust had use for in Chaska, Minnesota where it operated for the next sixty-six years. The Carrollton Sugar Company also included the defunct Saginaw Sugar Company which owned yet another Kilby-built factory, this one destined for Sterling, Colorado where it served from 1905 to 1985. Charles Warren assumed the presidency of Michigan Sugar Company, a position he held until 1925.

By 1920, the sun had set on the Sugar Trust. After a generation of withstanding attacks by various federal agencies including the U.S. Justice Department and the Interstate Commerce Commission, the American Sugar Refining Company gradually sold of its many components to private investors and in that way Michigan Sugar Company loosened itself from the grip of the Sugar Trust. Its entire post-trust board of directors consisted of Michigan residents, none of whom had association with the Sugar Trust with the exception of its president, Charles B. Warren whose interest now lay further afield first as Ambassador to Japan, 1921-1922, and then Ambassador to Mexico in 1924. He lost a bid to become Attorney General of the U.S. in 1925 during a politically charged senate vote influenced by an aversion to Warren's past association with the Sugar Trust. His aspirations for roles in the public sector kept him away from the President's office, a role ably filled by William H. Wallace who carried the title, 3d vice-president and General Manager. The first and second vice-presidencies fell to a couple of heavy hitters on the shareholder list that had no involvement in day-to-day activities.

Caro survives time and change

Thanks to James Howell, Caro's superintendent beginning in 1944, who prepared a recorded history in 1948, it is learned that Caro began stockpiling beets in the factory yard in 1937, an important step for growers who after delivering the beets to the factory, could look to the needs of other crops whereas formerly it was necessary to supply the beets as they were needed.
During the period 1928-1937, the Caro factory, like nearly all the Michigan beet sugar factories suffered the ill effects of the Great Depression. However, from 1937 until the present time, Caro reported steady improvement in terms of modernization and expansion. Centrifugals for white sugar and a new pulp warehouse were added in 1944. A centrifugal is an apparatus designed to separate sugar crystals from syrup by filtering the syrup through a screen that spins with sufficient (usually about 1,200 rpm) speed to create a centrifugal force that propels the syrup through perforations in a spinning basket. The sugar crystals remain in the basket while the syrup recirculates through the process to recover more of the sugar. These and other changes have caused the average daily slice rate to expand to more than 3,600 tons each twenty-four hours from the 500 tons per day in the original design which makes it a relatively small factory compared to others in the United States that range from twice as large to four times as large.


If Caro has a secret for surviving more than 100 years, it is that the factory Oxnard rebuilt remained precisely that for many years and remains so today, meeting challenges as they arise , gaining the support of its community and changing when occasion and opportunity join together to compel change. In that way, the oldest surviving beet sugar factory in the United States hangs on in a fast paced industry.


Sources:


HOWELL, James, A History of the Caro Plant of the Michigan Sugar Company, an unpublished account of the Caro Factory history, May 1, 1948

GUTTLEBEN, Daniel, The Sugar Tramp – 1954 p.182 concerning purchase of sugar factories by the Sugar Trust, p. 177 concerning organization of Sebewaing Sugar and operating results, printed by Bay Cities Duplicating Company, San Francisco, California

MARQUIS, Albert Nelson, editor, The Book of Detroiters, pages 465-468, A.N. Marquis & Company, Chicago, 1908 – concerning the biography of Charles B. Warren

MICHIGAN ANNUAL REPORTS, Michigan Archives, Lansing, Michigan:
Peninsular Sugar Refining Company filed 1904 and Michigan Sugar Company filed 1924

MOODY, John, The Truth about the Trusts, in reference to the comment that the Sugar Trust began buying beet sugar companies in Michigan in 1902 and dividend payments between 1892 and 1900.

UNITED STATES. In the District Court of the United States for the southern district of New York
United States vs. American Sugar Refining Co., et al. page 1674, Petitioner's Exhibit #1494

Copyright, 2009, Thomas Mahar, All Rights Reserved

About the Author: Thomas Mahar served as Executive Vice President of Monitor Sugar Company between 1984 and 1999 and as President of Gala Food Processing, a sugar packaging company, from 1993-1998. He retired in 1999 and now devotes his free time to writing about the history of the sugar industry. He authored, Sweet Energy, The Story of Monitor Sugar Company in 2001, and Michigan's Beet Sugar History (Newsbeet, Fall, 2006).Contact: Thomas Mahar E-mail tkmahar@aol.com