Why did Minneapolis’ famous flour boom go bankrupt?

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Minneapolis has been the milling capital of the world for nearly a century. But this industrial success, which lasted 50 years, remains a source of great pride for the “Mill City”.

High school student Nick Zylstra discovered the city’s milling prowess in a Minnesota studies course. But he wondered: what happened? He sought answers about why the flour boom didn’t last from Curious Minnesota, the reporting project fueled by Star Tribune readers.

The basic answer is that, in 1930, transportation, tariffs, and other factors made it more profitable to mill and ship flour from other cities—especially Buffalo, NY. Pillsbury, continued to prosper by investing in factories elsewhere.

“All the things that were [Minneapolis’] the benefits slowly eroded over time,” said David Stevens, site director of the Mill City Museum, which is owned by the Minnesota Historical Society.

Become the city of mills

Before the widespread use of electricity, Minneapolis became an industrial center because factories ran their machinery using water power from the natural high drop of the Mississippi River at St. Anthony Falls. As early as the 1840s, sawmills took advantage of this power to process tree trunks that had been floated down the river from the forests of northern Minnesota.

Milling, however, posed challenges.

Minnesota-grown hard spring wheat has a hard exterior that has broken off when milled using traditional methods, Stevens said. The resulting flour was speckled brown and spoiled quickly, due to the oil in the germ. Millers in southern Minnesota therefore began experimenting with a more gradual reduction process to extract the bran and germ, he said, leaving only the white endosperm.

“Once they figured out how to do this, spring durum wheat flour was truly the best bread flour in the world,” Stevens said. These methods were eventually adopted by Minneapolis riverside millers, resulting in what he calls a “democratization” of white flour – once considered a delicacy enjoyed by European aristocrats.

“Not everyone could afford it,” Stevens said. “It was a combination of cheap energy and this new technological revolution that kind of made this available for a mass market.”

Expansion into European markets around 1880 made Minneapolis the world leader in flour milling, he said.

It was a good time for Minneapolis. The town’s population nearly quadrupled in the decade after 1880. Washburn Crosby Co. – now General Mills – and Pillsbury Co. opened what were then the largest flour mills in the world in 1880 and 1881, respectively, located by the river. (One is now the Mill City Museum and the other contains apartments.)

Minneapolis flour production rose from 7 million barrels in 1891 to more than 20 million barrels at its peak during World War I in 1916, according to a 1929 history of American flour milling by Charles Kuhlmann. Just one of those barrels was equivalent to 196 pounds of flour.

“Depriving this city of its greatest prestige”

There is no simple explanation for why Minneapolis lost its milling title. The decline is the result of several factors, as noted in a summary compiled by the Mill City Museum.

First, it has simply become more expensive to ship flour from Minneapolis compared to other cities. Kuhlmann’s story explains that “special favors from the railroads” had helped the Minneapolis millers expand their empire. The Interstate Commerce Commission, which regulated freight rail rates, removed some of these benefits beginning in the early 1900s.

Minneapolis had enjoyed lower rail rates due to the competing Mississippi River trade route, for example. But the board removed that in 1922. Millers had also paid a cheaper rate on their flour shipments because it was considered wheat making a stopover en route to its destination. The commission eliminated this in 1920, forcing them to pay the highest rate for flour shipments.

When Washburn Crosby announced it was building a new factory in Buffalo in 1903, the company president told the Minneapolis Tribune that freight rail congestion was hampering shipments to eastern markets.

“Of course, Minneapolis is and will remain the dead center of world milling,” James S. Bell told the newspaper.

The city of Buffalo benefited from its location. Grain shipments from ports like Duluth could get there via the Great Lakes, and processed flour could easily make its way to the East Coast and international markets.

Because of this, Buffalo also benefited more than Minneapolis from an 1897 tariff change that allowed Canadian wheat to be imported, milled and exported duty-free, according to the museum’s summary.

Meanwhile, other varieties of wheat began to compete with Minnesota’s prized hard spring wheat in the early 1900s. And the benefits of cheap water power were diminishing day by day due to advances in technology.

“Buffalo is becoming the largest milling center in the world, robbing this town of its greatest prestige and the reason for that is – freight rates,” proclaimed HG Benton, secretary of the Minneapolis Real Estate Board, in 1925, according to the Minneapolis Star.

By 1930, Buffalo was producing more flour than Minneapolis, ending Mill City’s half-century dominance in the market. Kansas City also rose to prominence as a milling center. Pillsbury and Washburn Crosby have invested in factories at or near both locations.

“Buffalo was the main competitor, but no city would dominate the industry again like [Minneapolis] did from the 1870s to around 1915,” historian Bob Frame, who writes a book about flour milling in Minneapolis, wrote in an email. “Buffalo really hasn’t become the ‘Mill City’ like [Minneapolis] was the Mill City.”

An industrial heritage

Minneapolis riverside milling eventually died out (with the exception of a Pillsbury plant which continued to operate until 2003). Loggers ran out of white pine for sawmills around 1910, Stevens said. Many riverside flour mills were razed in the 1930s, Frame said.

“It left the [Minneapolis] milling district in St. Anthony Falls is not much different than it is today, with five mill structures remaining,” Frame wrote.

Patrick Ryan, who oversees education and programs at the Buffalo History Museum, said Buffalo residents are very proud of the area’s role in milling history. Grain elevators still dot the waterfront, he said, some of which have been redeveloped into art installations.

“The largest grain and milling structures in the area and what to do with them have been hotly debated in recent years, with most residents clamoring for historic landmark status,” Ryan wrote in an email. Among those structures, which are currently the subject of a legal battle, is the 1897 Great Northern Elevator, which was owned by the Pillsbury Co. for several decades.

The city is also home to a massive General Mills factory that produces Cheerios. ‘My town smells like Cheerios’ The products are popular in local stores, Ryan said, and even the local visitors bureau promotes the phrase.

Today’s flour milling industry relies on a smaller number of large factories, Josh Sosland, editor of Milling & Baking News in Kansas City, Mo., told the Star Tribune in 2019. Their location increasingly depends proximity to major population. centers, he said, in relation to the location of an abundant supply of wheat.

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