United States Leather Company: a tale of power and forests
Right now I am working on the history of the United States Leather Company. It is an amazing story. It was formed in 1893 when some 70 companies owning over 100 tanneries got together to form a new corporation in the hope of leveraging their buying power to get a better deal on hide prices from the meat packers. All the tanneries were involved in heavy leather mostly hemlock and some oak tanners although the best oak tanners refused to join. They also got about 50% of the “union” tanners who worked with a mixed oak and hemlock system.
Just after setting up the United States Leather Company, capitalised at $128m was the largest company in the US and one of the founding companies of the Dow Jones. History was not to be too kind to them as they were unable to do any deals on raw hides and when you think about it there are not many economies of scale in heavy leather tanning. Hemlock was processed using Latin American hides and sold in the US and Europe where they had to compete with quite strong industries in France, Germany and the UK. The oak tanners did not seem to be able to gain any advantage over the small independent oak tanners who used local hides and local hemlock.
When you wonder why the tanning industry meandered so far and wide in the US – north and south of Boston and then out to West Massachusetts, up the Hudson Valley in New York to the Catskills and then a little later into the Adirondacks before going on to Maine and off into the west – think of trees. A New York Times article of 1856 says that a tannery “of the largest class” used nearly a square mile of hemlock trees per annum, measured as not less than 6000 cords. Tanneries were always set beside streams to obtain motive power but in the 1850s steam engines had been widely introduced, especially after it was realised that spent bark in its wet state was an excellent fuel.
The opening of the canals and railways also made all this much easier and New York had been busy since the start of the 19th century sending the hides to the bark rather than bringing the bark to the tanneries in the famous New York Swamp area. As a result many of the New York tanners became traders and property owners such as the Astors, the Lees, the Schultzs, and the Hoyts and many others. Those that invested in tanning formed the group that later in the century put their businesses into the United States Leather Company and it does appear that some of the families did so as the elders felt that this was the best way to extract finance from the business rather than pass them on as independent companies. Not all though, as some of the families carried on in senior management and Hoyts for example provided a famous company President after the First World War
The company had quite a struggle though, and more time was spent raising the property value of their timber forests than making money from tanning and the first fifteen years were pretty unsuccessful. They often seemed to get caught with too much inventory in the factory or on the water from South America when the price of finished leather fell. In the early 1900s they gave up trying to fight the abattoirs and handed over management to the Armour Company for about five years, paying them some $6m in stock for doing it. Briefly the company changed its name to Central Leather Company to mange a state law issue and to change the terms so they could own a lumber business and set up lumber railways. From 1910 for about a decade they did quite well but it appears that in the 1920s on the loss of harness leather as motor vehicles came in, and industrial belting as rubber belting came in drove them into steady decline. Then as chrome took over more and more and sole leather slipped away so did the United States Leather Company to closure in January 1952.
I am short of information on the company from 1920 on, and would really like to know more of this period. If you have any idea where I can get hold of it, or anything about the business at all please let me know.
2nd June 2008