Grain Elevator - History

History

It was both necessity and the prospect of making a lot of money that gave birth to the steam-powered grain elevator in Buffalo, New York, in 1843. Ever since the construction of the Erie Canal in 1825, Buffalo had enjoyed a unique position in American geography. It stood at the intersection of two great all-water routes: one extending from New York Harbor, up the Hudson River, to Albany and, beyond it, the Port of Buffalo; the other constituted by the Great Lakes, which could theoretically take boaters in any direction they wished to go (north to Canada, west to Michigan or Wisconsin, south to Toledo and Cleveland, or east to the Atlantic Ocean). All through the 1830s, Buffalo benefited tremendously from its position. In particular, it was the recipient of most of the increasing quantities of grain (mostly wheat) that was being grown on farms in Ohio and Indiana, and shipped on Lake Erie for transshipment to the Erie Canal. If Buffalo hadn't been there, or when things got backed up there, that grain would have been loaded onto boats at Cincinnati and shipped down the Mississippi River to New Orleans.

By 1842, it was clear that Buffalo’s port facilities weren’t keeping up. They still relied upon techniques that had been in use since the European Middle Ages: work teams of stevedores would use block and tackles and their own backs to unload or load each and every sack of grain that had been stored or was to be stored in the boat’s hull. It would take several days, sometimes even a week, to service a single grain-laden boat. Grain shipments were going down the Mississippi River, not over the Great Lakes/Erie Canal system. A merchant named Joseph Dart, Jr., is generally credited as being the one who adapted Oliver Evans’ grain elevator (originally a manufacturing device) for use in a commercial framework (the transshipment of grain in bulk from lakers to canal boats), but the actual design and construction of the world’s first steam-powered “grain storage and transfer warehouse” was executed by an engineer named Robert Dunbar. Thanks to the historic “Dart Elevator” (operational on 1 June 1843), which worked almost seven times faster than its non-mechanized predecessors, Buffalo was able to keep pace with – and thus further stimulate – the incredible growth of American agricultural production in the 1840s and 1850s, but especially after the Civil War, with the coming of the railroads.

It wasn’t by accident that the world’s second and third grain elevators were built in Toledo, Ohio and Brooklyn, New York, in 1847. Fledgling American cities, they were connected through an emerging international grain trade of unprecedented proportions. Grain shipments from farms in Ohio were loaded onto ships by elevators at Toledo; these ships were unloaded by elevators at Buffalo that transshipped their grain to canal boats (and, later, rail cars), which were unloaded by elevators in Brooklyn, where the grain was either distributed to East Coast flour mills or loaded for further transshipment to England, the Netherlands or Germany. But this eastern flow of grain was matched by an equally important flow of people and capital in the “opposite” direction, that is, from East to West. Because of the money to be made in grain production and, of course, because of the very existence of an all-water route to get there, increasing numbers of immigrants in Brooklyn came to Ohio, Indiana and Illinois to become farmers. More farmers meant more prairies turned into farmlands, which in turn meant increased grain production, which of course meant that more grain elevators would have to be built in places like Toledo, Buffalo and Brooklyn (and Cleveland, Chicago and Duluth). It was precisely through this “feedback loop” of productivity – set in motion by the invention of the grain elevator – that America itself became an agricultural and economic colossus on the world stage: the planet’s single largest producer of wheat, corn, oats and rice, a distinction it claims to this day.

In the early Twentieth Century, there was concern about monopolistic practices in the grain elevator industry, leading to testimony before the Interstate Commerce Commission in 1906. This led to several grain elevators being burned down in Nebraska, allegedly in protest.

Today, grain elevators are a common sight in the grain-growing areas of the world, such as the North American prairies. Larger terminal elevators are found at distribution centers, such as Chicago and Thunder Bay, Ontario, where grain is sent for processing, or loaded aboard trains or ships to go further afield.

Buffalo, New York, the world's largest grain port from the 1850s until the first half of the 20th century, once had the nation's largest capacity for the storage of grain in over thirty concrete grain elevators located along the inner and outer harbors. Many of those that remain are presently idle, but a new ethanol plant started in 2007 will use some of the elevators to store corn. In the early 20th century, Buffalo's grain elevators inspired modernist architects such as Le Corbusier, who exclaimed, "The first fruits of the new age!" when he first saw them. Buffalo's grain elevators have been documented for the Historic American Engineering Record and added to the National Register of Historic Places. Currently, Enid, Oklahoma, holds the title of most grain storage capacity in the United States.

In farming communities, each town had one or more small grain elevators that would serve the local growers. The classic grain elevator was constructed with wooden cribbing and had nine or more larger square or rectangular bins arranged in 3 × 3 or 3 × 4 or 4 × 4 or more patterns. Wooden cribbed elevators usually had a driveway with truck scale and office on one side, a rail line on the other side and additional grain storage annex bins on either side.

In more recent times with improved transportation, centralized and much larger elevators serve many farms. Some of them are quite large. Two elevators in Kansas (one in Hutchinson and one in Wichita) are half a mile long. The loss of the grain elevators from small towns is often considered a great change in their identity, and there are efforts to preserve them as heritage structures. At the same time, many larger grain farms have their own grain handling facilities for storage and loading onto trucks.

Grain elevator operators buy grain from farmers, either for cash or at a contracted price, and then sell futures contracts for the same quantity of grain, usually each day. They profit through the narrowing basis, that is, the difference between the local cash price, and the futures price, that occurs at certain times of the year.

Before economical truck transportation was available, grain elevator operators would sometimes use their purchasing power to control prices. This was especially easy since farmers often had only one elevator that was within a reasonable distance of their farm. This led some governments to take over the administration of grain elevators. An example of this is the Saskatchewan Wheat Pool. For the same reason, many elevators were purchased by cooperatives.

A recent problem with grain elevators is the need to provide separate storage for ordinary and genetically modified grain to reduce the risk of accidental mixing of the two.

In the past, grain elevators sometimes experienced silo explosions. Fine powder from the millions of grains passing through the facility would accumulate and mix with the oxygen in the air. A spark could spread from one floating particle to the other creating a chain reaction that would destroy the entire structure. (This dispersed-fuel explosion is the mechanism behind fuel-air bombs.) To prevent this, elevators have very rigorous rules against smoking or any other open flame. Many elevators also have various devices installed to maximize ventilation, safeguards against overheating in belt conveyors, legs, bearing, and explosion-proof electrical devices such as electric motors, switches and lighting.

Grain elevators in small Canadian communities often had the name of the community painted on two sides of the elevator in large block letters, with the name of the elevator operator emblazoned on the other two sides. This made identification of the community easier for rail operators (and, incidentally, for lost drivers and pilots). The old community name would often remain on an elevator long after the town had either disappeared or been amalgamated into another community; the grain elevator at Ellerslie, Alberta, remained marked with its old community name until it was demolished, which took place more than twenty years after the village had been annexed by the City of Edmonton.

One of the major historical trend in the grain trade has been the closure of many smaller elevators, and the consolidation the grain trade to fewer places and among fewer companies. For example, in 1961 there were 1642 "country elevators" (the smallest type) in Alberta, holding 3,452,240 tonnes (3,397,720 long tons; 3,805,440 short tons) of grain. By 2010 there were only 79 remaining "primary elevators" (as they are now known), holding 1,613,960 tonnes (1,588,470 long tons; 1,779,090 short tons).