American Fur Company

The American Fur Company was established by John Jacob Astor in New York State, on April 6, 1808. He began tanning furs locally, and built a growing, lucrative fur trade with private trappers and Native Americans from Nova Scotia to the Carolinas.

He expanded to the Great Lakes, the Northern Great Plains, and eventually the Columbia River drainage in Oregon; and in the process, his American Fur Company became the largest fur trading company in North America, surpassing even the Hudson Bay Company of Canada.

Historical Context

Born Johann Jakob Astor near Heidelberg, Germany in 1763, Astor was the youngest of four brothers but born with an aggressive businessman’s heart. His innate ability as a businessman would lead him to become the first multi-millionaire in American history.

Astor moved to England when he was 16 with his brother George and began building pianos and woodwind instruments in his uncle’s shop. He learned English, Anglicized his name to John Jacob Astor, and soon headed across the Atlantic to the newly formed United States of America in 1784. While on his trans-Atlantic passage, Astor met a Canadian fur trader who intrigued him with tales of Native Americans, beaver, bison, and grizzly bears.

The fur trade was booming in Canada and the Western  territories of United States.

The Beginning of a Fur Trading Empire

Astor began trading with Native Americans in upstate New York for raw furs. He would take the raw pelts, tan the hides and sell them to buyers in London. His profit margins were high. By 1790, he opened a fur trade shop in New York while continuing to sell the musical instruments his uncle had shipped from London to the newly formed United States.

In 1794, the Jay Treaty opened up commerce between the United States and Canada. Astor took advantage of the new loosened trading laws with the Canadians and began buying furs from the North West Company in Montreal. At age 37, Astor was worth $250,000, the equivalent of six million dollars today, and well on his way to becoming an international trading magnet.

The American merchant ship the Empress of China opened trade between New York City, and Canton, China in 1800. Astor took note and began a lucrative trade with the Chinese. Astor’s furs were in high demand in China, where he traded them for tea, silk, and sandalwood for trade back in the Americas. His venture into the Pacific would lead him to even greater wealth via the fur trade a few years later.

Astor began forming business partnerships with the Pacific Fur Company, and the Southwest Fur Company, both Canadian based operations, to keep control of the rich beaver trapping areas of the Great Lakes.

Soon he looked further west to the Columbia River drainage after news of the rich farmlands, abundant wildlife, and incredible beaver populations were relayed to the rest of the nation by the Lewis and Clark Expedition’s return.

The American Fur Company

After he formed the American Fur Company on April 6, 1808, Astor sent expeditions across the American West, establishing Fort Astoria on the mouth of the Columbia in present-day Oregon in April 1811.

He paid for another overland exploration of the Rocky Mountains from 1810 to 1812. The Astor Expedition, as it was known, were the first European or Americans to discover and traverse South Pass in west-central Wyoming. The expedition reached the Great Salt Lake, but constant battles with Native Americans, short provisions, and disease forced them north, towards Fort Astoria. They reached the western outpost in 1813.

Located on the Columbia River, Fort Astoria was one of the most isolated settlements in all of North America; and it was open to attack by marauding English warships during the War of 1812, and Russians who felt the area belonged to them, rather than the citizens governed by the distant American government almost 4,000 miles to the east.

Fort Astoria

Fort Astoria was settled in 1811 by two groups of Astoria’s men. The people who worked for John Jacob Astor eventually became known simply as Astorians, who reached Fort Astoria by following the same route blazed by Lewis and Clark just half a decade before.

Another group arrived from New York City aboard a ship aptly named Beaver, which was owned by the American Fur Company. The Beaver sailed around Cape Horn, arriving at the mouth of the Columbia in 1811. The area was described by Ross Cox, ship’s clerk of the Beaver, as “magnificent, among the most wonderful places we’ve seen with tall fir trees, rich, luxuriant soil, and an abundance of fruits and edible roots.”

When he heard news of the vast numbers of salmon swarming in the waters, Astor’s entrepreneurial mind envisioned a bonanza of trade with salmon, furs, and lumber he could ship  to China, the Philippines, and Southeast Asia. This led to the expansion of the Pacific Fur Company, which was Astor’s only asset on the Pacific coast–and the potential profits were tremendous.

Japanese markets were still closed to western trade, and wouldn’t open until another half-century had almost passed.

England Captures Fort Astoria

Astor wasn’t the only person who knew of the vast wealth waiting to be exploited along the Columbia. The North West Company, Astor’s old business partners, were interested as well. They sent Alexander MacKenzie, Simon Fraser, and David Thompson from Montreal on another expedition West, to map a more northern route to the mouth of the Columbia.

Rather than just taking a long march to the Columbia as the Astorians had done, the men of the North West Company established trading posts at key river junctures, and Native American trading routes as they moved west. One was Fort Covile, which was on the Columbia in present-day Washington State, with several smaller posts along the upper Missouri, the Yellowstone, and the Snake River.

As the company surveyor, Thompson had orders to make contact with the Astorians at Ft. Astoria. He arrived in 1813 and greeted the paranoid clerks of the American Fur Company. Canada was an English ally at the time; and  English forces marched South from Canadian bases to the United States during the War of 1812. The men of the North West Company were officially combatants with the Astorians since both of their nations were at war.

To further complicate the issue, the 20 gun British ship, HMS Racoon, arrived in Fort Astoria on November 30, 1813, with orders seize American property. After assessing the strength of its defenses, the Commander the Raccoon, Captain William Black, captured Fort Astoria in the name of King George, which ended Astor’s Pacific Fur Company before it had time to generate the substantial profits he envisioned.

The North West Company overtook Fort Astoria and held it until economic pressure from the much larger Hudson Bay Company took over the fort in 1821.

The Fur Trade in Decline

Astor had lost his position on the Pacific Coast, but still maintained a solid trade around the Great Lakes Region and the upper Mississippi Basin, even with the constant threat of attack from English allies in Canada–which never materialized.

Astor’s fur business and his growing trade with China thrived throughout the War of 1812, though it was difficult at times to break the occasional blockade by English warships off the harbors at New York, Boston, and Norfolk. He continued to trade furs to the Qing Empire in China, using the port of Guangzhou as a trading base. American fur was in high demand in China. They not only sought beaver, but also wolf, ermine, coyote, fox, mink, and bison hides as well. In return, Chinese merchants shipped spices, silk, tea, and handcrafted porcelain back to the United States.

Astor also traded knives, gunpowder, cloth, and firearms with Native Americans across the the Northern Plains, the Great Lakes, and the Rocky Mountains in exchange for furs. They were a principal trading partner with many tribes and independent trappers during the popular trading rendezvous of Idaho and Wyoming from 1826 to 1843.

Attempts at International Trade

After Russian trappers and traders had crossed the Bering Sea beginning in the 1600s, they gained a strong influence in Alaska, British Columbia, and as far south as Northern California. Astor sought to increase his international trade with the Russians who gained a strong influence in Alaska, British Columbia, and as far south as Northern California; but he was unable to complete the trade deal. He had hoped to supply Russian outposts along the Pacific Coast and inland along the major rivers of the Northwest with American-made supplies, but it never materialized.

Astor took notice of the declining demand for beaver pelts on the European market in the 1830s. Beaver hats were once all the rage but began to lose popularity in competition with the new silk styles fueled by Astor’s own marketing ideas in bringing Chinese silk back to the United States and Europe.

Demand for all types of furs faded by the 1840s. The last fur trading rendezvous was held in 1843 near Pinedale, Wyoming and the trade gradually changed from a vibrant, international enterprise to the isolated work of a few die-hard trappers who tried to cling to their old ways.

Astor was a forerunner of the “Captains of Industry” that rose to prominence after the Civil War, but his American Fur Company, including his commerce with China, didn’t rival the growing railroad, textile, and machinery production of the other principal industries in the first half of the 19th century. In comparison to the wealth generated by Carnegie, Rockefeller, Vanderbilt, and Morgan, Astor’s was a modest empire. But, the American Fur Company was the first American business empire.

The American Fur Company went bankrupt in 1842 without Astor’s backing and dissolved five years later, with the last fur trades made in 1847. Astor died on March 29, 1848, in New York City. His great-grandson, John Jacob Astor IV, is remembered as the wealthiest victim of the Titanic in 1912, when he drowned after the unsinkable ship struck an iceberg.