Great Western Malting Company

  • By John Caldbick
  • Posted 10/08/2011
  • HistoryLink.org Essay 9946

Great Western Malting was founded in Vancouver, Washington, shortly after the repeal of Prohibition by a group of Washington and Oregon businessmen, most of whom were brewery owners. Prohibition had started in the two states in January 1916, four years before the Eighteenth Amendment had taken it nationwide, and the brewers had seen their businesses criminalized overnight. In 1934, when Prohibition was no longer the law of the land, they saw an opportunity to recoup some of what they had lost during the long "dry" years. Their Great Western Malting plant was built in 1935 on land leased from the Port of Vancouver and soon became a leading supplier of malt for the brewing, distilling, and food-processing industries. Still going strong after more than 75 years of steady growth and many changes of ownership, Great Western Malting  is now the oldest malting company in the western United States and its products are used the world over.

 

Barley, Beer, and Bans

The Sumerians wrote down recipes for beer brewed from barley as long ago as 6,000 BCE, and it probably existed for millennia before that. Once discovered, it never lost its allure. The Mayflower carried more beer than water on its journey to North America, and when that ran out the Pilgrims brewed beer from corn. A commercial brewery was established on Manhattan Island as early as 1612, and beer moved west across America with the human tide of settlement. The first brewery in Oregon Territory opened in Portland 1852, followed in 1854 by the Denlin Brewery at Steilacoom in Washington Territory.

By the early years of the twentieth century, brewing beer was big business in the Pacific Northwest. Among the most successful of the region's beer makers before Prohibition were the Henry Weinhard Brewery, founded in 1856 in Portland by its namesake; the Portland Brewery, also of Portland, owned by Arnold Blitz; the Star Brewery in Vancouver, also owned by Blitz; and Olympia Brewing at Tumwater, founded by Leopold and Louis Schmidt in 1896.

The brewing industry also supported growers of barley and hops. Barley, although it has other uses, has long been considered the sine qua non of beer, and much of the annual crop went to making barley malt for brewing. Hops have hardly any use other than as a flavoring for beer, and its growers were almost totally dependent on the brewers for their survival. Beer and America had a long and profitable history together, and it must have seemed inconceivable that this would not always be so.

The Progressive movement in American helped bring about woman suffrage and other laudable reforms, but it was also a primary well from which the push to prohibit alcohol drew its strength. Many suffragists, having won the vote and made allies of clergy and others of like mind, refocused their considerable energy on ridding the nation of what they viewed as an intolerable scourge. On November 3, 1914, voters in Washington and Oregon approved laws in their respective states prohibiting the manufacture or sale of alcohol, to become effective January 1, 1916. The one-year delay for enforcement gave brewers, distillers, and saloon owners time to wind down their business affairs. When the appointed day arrived, the two states became officially and legally "dry," joining 17 other on the march to full Prohibition.

The Eighteenth Amendment to the Constitution was ratified and became the law of the entire land on January 16, 1919, but as with Washington and Oregon, the effective date was delayed for one year. The amendment specifically outlawed "intoxicating liquors," but failed to define the term. Many of those who supported Prohibition had done so with the tacit understanding that beer and wine would still be allowed, but the October 1919 passage of the Volstead Act, which made illegal any libation with more than 0.5 percent alcohol, put those popular beverages in the same proscribed class as whiskey, gin, and other strong spirits. In a stroke, one of humanity's oldest documented activities, the brewing of beer, was criminalized.

Saloons were shuttered nationwide and breweries struggled to stay alive, many without success. It would take 13 years before Prohibition was recognized as an utter and expensive failure. Among the more damning criticisms was that it created a nation of casual lawbreakers -- men and women who enjoyed having the odd tipple, or more, would not be dissuaded by words on paper, even the paper of the U.S. Constitution.

Most of the larger breweries owned saloons or the land under them and had profited on either end of the stream of commerce. When Prohibition came, they lost income on both the wholesale and retail sides, and many could not survive. A few managed to scrape by making syrups, sodas, and low-alcohol "near" beer that bore scant resemblance to the real thing. Some tried consolidation -- in 1928 the Weinhard-owned City Brewery in Portland and Arnold Blitz's Portland Brewing avoided bankruptcy by merging to form the Blitz-Weinhard Brewing Company. The companies were saved, but it and the other surviving brewers could do little more than bide their time, maintain their equipment, and wait for the nation to tire of its "Great Experiment."

A Second Chance

During the 1932 presidential campaign Franklin D. Roosevelt  (1882-1945) had promised to end Prohibition, and once elected he proved as good as his word. He could not do it by fiat, however; the alcohol ban was embodied in a constitutional amendment and could only be rooted out by another amendment. But the Volstead Act could be changed, and on March 22, 1933, just 18 days after his inauguration, Roosevelt signed the Beer and Wine Revenue Act, which permitted the sales of beer and wine with alcohol content of less than 3.2 percent.

The surviving breweries in the Pacific Northwest were quickly up and running again, soon to be joined by many new enterprises including, in Washington alone, Horluck Brewery (1933), Pilsener Brewing Company (1933), Apex Brewing Company (1934), and Elmer E. Hemrich's Brewery, Inc. (1935), all of Seattle; Columbia Breweries (1933) in Tacoma; and Silver Springs Brewing Company (1934) of Port Orchard, among others.

On December 5, 1933, Utah became the 36th state to ratify the 21st Amendment repealing Prohibition, and President Roosevelt immediately issued a repeal proclamation. It marked the first time in the country's history that one constitutional amendment specifically repealed another. It had taken years for the opponents of alcohol to gather sufficient support for a constitutional amendment banning alcohol; its repeal took less than one.

The demand for brewing ingredients surged, and in this demand some who had barely weathered Prohibition saw an opportunity to recoup their losses. Breweries and distilleries needed barley malt, and there were no malting facilities in the Pacific Northwest. This would change in 1934 when a consortium of businessmen got together and formed Great Western Malting. Among them were brewers Arnold Blitz and William Einzig, of Blitz-Weinhard; Phillip Polsky, of Vancouver's Star Brewing; Peter Schmidt, of Tumwater's Olympia Brewing; and Emil Sick (1894-1964), who had opened the Century Brewing Company (later Rainier Brewing) in 1933. They were joined by Henry Collins of the Pacific Continental Grain Company and J. R. Bowles, a Portland-based entrepreneur who had made a fortune in the steel industry.

Great Western Malting

Barley is one of humankind's oldest domesticated grain crops and today has two primary uses -- brewing and as livestock feed. Barley used for brewing is classified as either two-row or six-row, a reference to the arrangement of kernels on the head of the grain. Six-row barley is grown only in North America, while two-row is grown both here and abroad. Great Western Malting has used both varieties, but today its product is derived from two-row barley, which is more easily cultivated in climate of the Pacific Northwest.

"Malting" is the process by which the starches and proteins in barley kernels are converted to sugars and amino acids useful for brewing. Although there are variations, the most common method is to soak raw grain in water to prompt germination, then move it to a kiln to dry and to halt the chemical processes, after which it is stored until use. About 80 percent of the malted barley produced in the United States is used for brewing beer and distilling liquors, and it was this vast potential market that Great Western sought to supply.

A malting plant has three basic needs -- a steady supply of grain, access to clean water, and the means to bring raw barley in and ship malted barley out. Barley was grown in both Eastern Washington and the Willamette Valley in Oregon, and the Columbia River provided an inexhaustible source of clean water. The Port of Vancouver, which had been operating since 1912, had land to lease, was convenient to the barley-growing areas, was adjacent to the river, and offered ready access to rail and water transportation. Better yet, in 1934 the Spokane, Portland and Seattle Railway had built on Port land a 2,100,000-bushel grain elevator that was leased to the Pacific Continental Grain Company. The land that Great Western Malting would lease from the Port was right next door, obviating the immediate need to build its own storage elevators to hold raw grain. In short, the Port offered everything the investors would need, and they wasted no time.

Construction started in 1935 on the site next to Pacific Continental's grain elevators. The malting plant, which initially cost $350,000, was made of poured concrete and had two major functional components -- giant malting drums for germinating the barley and kilns for drying the grain, which halted the germination process and toasted the final product. A conveyor belt connected the plant to the storage elevators next door where the barley grain was stored until needed. The entire facility was designed by the Galland-Henning Pneumatic Malting Drum Manufacturing Company of Milwaukee, Wisconsin, which also supplied much of its original malting equipment.

From the start, Great Western's ownership, dominated by brewers, was determined to provide a quality product. Rather than entering into long-term contracts with growers, the malting plant would every year select the best grains from the farms of the Pacific Northwest and, eventually, from those in Idaho and California as well. The malting process was tightly controlled. Raw grain was soaked for two or three days to spur sprouting, then placed in large pneumatic drums, so called because air, the temperature and humidity of which could be precisely controlled, was injected into them to "condition" the grain. The portion of the plant housing this equipment soon became known as the Drum House.

After five days the barley was transferred from the drums to kilns, where over the next two days its moisture content was reduced, germination stopped, and toasting begun. The entire malting process took an average of 10 days, and the drums and kilns operated 24 hours a day. What was left at the end of this process was pure, high-quality barley malt, suitable for brewing, distilling, and food (malt is used in baking as malt flour, and in malted milk, malted shakes, and other food products). With certain refinements and newer technologies, the same basic malting process is used today.

Early Success, Rapid Growth

In its first year of operation Great Western malted an estimated one million bushels of barley. By 1939 it dominated the barley-malt market on the West Coast and was soon able compete successfully in the Midwestern and Eastern barley-malt markets, long controlled by older, more established maltsters. Its success was a boon not only to its founders and employees, but also to the region's farmers, who soon were supplying Great Western with 25,000 tons a year of barley.

The pent-up demand for beer, and thus the need for quality barley malt, continued to grow, and in 1940 the company built a 350,000-bushel malt-storage facility next to its plant, with a new roadway for trucks and a new rail spur to tie it to the tracks that served the Port and connected to the long-distance lines. The storage area had 18 separate compartments in which the 12 varieties of malt the company was making could be segregated.

The Rahr Years

The company's quick success soon drew the attention of other large players in the industry. By 1944 Rahr Malting of Manitowoc, Wisconsin, a family-owned company that had been in the malting business since 1847, had gathered up a controlling interest in Great Western, the first of several changes of ownership that would take place over the ensuing decades.

Shortly after taking over, Rahr contracted with Galland-Henning to supply an additional 10 malting drums, bringing the total to 30. These were housed in a new building known as Drum House 2. Additional improvements of that era included a new grain elevator and updated equipment. One thing stayed the same, however. Despite the change in ownership, Great Western continued to be highly selective in its choice of barley. In 1945 the company started an annual "Best Barley" contest for its suppliers in Washington, Oregon, and Idaho. The rules, as explained during the third annual contest, held in 1948, were simple:

"Each entry must be accompanied by a statement from the county agent certifying that the exhibit represents the product of not less than 10 acres of barley, grown by the exhibitor. Each entry must be accompanied by at least one 100-pound grain sack of barley" (Spokane Daily Chronicle, August 23, 1948).

The prizes varied year by year, but in 1948 the farmer who submitted the best barely sample was awarded an expensive Allis-Chalmers combine, a machine used for harvesting grain crops. Runners-up divided an additional $2,000 in prize money, and Great Western was assured of a steady supply of the finest barley to be found in the Northwest.

In the late 1940s Rahm added new processing equipment to the Vancouver plant, another grain elevator for barley, and 65 new storage bins for the finished malt. This increased Great Western's total storage capacity to one million bushels, and by 1950 the company was capable of producing 40,000 tons of barley malt each year.

The Tap Room

One addition that Rahr made to the Great Western plant had little utility but a lot of charm. In 1947 the company added office spaces and an onsite product-testing laboratory. The improvements were designed by a prominent Portland firm, Wolff & Phillips Architects, and incorporated into an expanded Drum House 1. These facilities were needed to cope with the company's expanding business, but another addition designed by Wolff & Phillips seemed motivated more by whimsy than necessity. This was the Tap Room, a cozy clubhouse that could be used by company employees and for various public events.

The Tap Room was built and decorated in Streamline Moderne, a late manifestation of the Art Deco style that began in Europe and became very popular in American in the 1930s. The room was paneled from floor to ceiling in oak and decorated with paintings by the Spanish muralist Jose Moya del Pino (1891-1969) that depicted farm workers of an earlier era hand-harvesting and soaking barley. Etched into one oak panel was a carving by noted Oregon wood sculptor Leroy Setziol (1915-2005) showing a beer stein overflowing with barley stalks, wreathed by hop vines.

The most popular feature of the Tap Room no doubt was the stand-up bar, served by a single beer tap that was connected to a "Kegerator" holding one cold keg of beer. Visitors could sit on overstuffed red-leather furniture, warm themselves before a huge Roman-brick and ceramic fireplace, and sip a cold one, surrounded by artwork, period fixtures, stained glass, and copper details that included a shining fireplace hood and a metal-sheathed door. Not surprisingly, the Tap Room was an immediate success, and for well more than 60 years it would provide a cozy and intimate space for workers and for small public gatherings.

More Growth, New Owners

In the late 1940s Great Western started using Hannchen barley, a high-grade, two-row variety that was grown in only Washington, Oregon, and Western Idaho, for much of its malting. It proved extremely popular with brewers, and the company continued on what so far had been an unchanging path of profits and growth. In 1956 a new, million-bushel elevator doubled its grain-storage capacity, and a year later the laboratory was updated and enlarged. Investments were also made in new hopper rail cars, purpose-built to carry the company's product to customers across the country.

Great Western continued to enjoy the kind of rapid growth and impressive earnings that made it an attractive takeover target. What was to become an almost-dizzying series of mergers, leveraged buyouts, and outright sales began in 1960 when Rahr merged Great Western with a competitor, California Malting. The combined enterprise received a new name, but barely -- they simply added the word "Company," to "Great Western Malting." 

In 1964, several of Great Western's corporate officers put together a leveraged buyout and took the company private. This did nothing to slow the firm's growth. The new owners opened a malting plant in Los Angeles and continued to expand and improve the Vancouver facility by increasing its grain-storage capacity to 2.5 million bushels, adding 15 new pneumatic drums (for a total of 45), and installing a double-deck kiln. With this additional capacity the Vancouver plant's 60 full-time employees were able to produce six million bushels of malt each year.

Boomers and Beer

By the late 1960s the first wave of the post-World War II baby-boom generation was turning 21, and between 1965 and 1975 the nation's average annual per capita consumption of beer grew from 16 gallons to slightly more than 21 gallons, an increase of more than 30 percent. The demographics were very encouraging for the beer business, and Great Western's investment value grew apace.

In 1968 a Portland-based conglomerate, Columbia Nyematic Systems, Inc., added Great Western to its portfolio of diverse enterprises. This coincided with the completion of a $2 million addition to the Vancouver facility, called the Fleximalt Plant, which consolidated the drum-drying and kilning processes and eliminated the need to move the barley from one piece of equipment to another. This both doubled the plant's production capacity and brought savings in power and labor costs. With this and other improvements, Great Western had quadrupled its malting capacity in just 10 years. To cap things off, the company set records for both domestic and foreign sales in 1972, and repeated that feat for exports the following year.

In early 1976 Columbia Nyematic (by now renamed the Columbia Corporation) sold Great Western for $20 million to Univar Corporation, a Seattle-based distributor of chemical products. The new owners continued to expand the company's facilities and almost immediately installed a new, 150-foot-long kiln that greatly increased production capacity. Two years later, in 1978, work was completed on seven new barley-storage bins, eight silos, and a new, $7 million malt house. It seemed that nothing would slake America's growing taste for beer or halt Great Western's steady growth.

The Doldrums

Yet something did. By the mid-1980s the demand for beer had leveled off and even decreased, if only slightly. The 23.1-gallon per capita consumption of 1980 dropped to 22.6 by 1990. The boomers who had supported the industry since the late 1960s were settling down and increasingly preoccupied with health and fitness, and a new generation of potential consumers did not entirely take up the slack.

Another problem was the extreme concentration in the business of brewing. Increasingly, more of the annual beer production was controlled by fewer breweries. In the 1980s five breweries controlled 80 percent of the domestic market, and this gave them considerable leverage in negotiating malt prices. Even the international market went flat when a strong American dollar forced foreign brewers to seek their ingredients closer to home. It began to look like Great Western's long glory days may have come to an end.

In 1984 Univar spun off Great Western and another of its companies into a separate entity, which it named PenWest. This made for a smaller and more agile business, better able to adjust itself to the changing marketplace. Things began looking up in 1987, when Great Western sold 22 tons of malt to China, the first foreign company in history to do so. Sales to Japan and the Philippines picked up and the domestic market, if not booming, stayed stable. In 1988 Great Western built two new germination facilities. The company's Port of Vancouver site was now the second-largest malting plant in the U.S. and supplied 15 percent of all the malt used to make the country's beer.

In late 1988 the Canada-U.S. Free Trade Agreement opened Canadian markets to American malt, and the following year Canada Malting paid $125 million to buy PenWest and became the world's leading supplier of barley malt. Another spate of growth was to follow, fed in large part by new tastes in beer.

The Micros

In the years following the repeal of Prohibition, America's taste in beer had been steered by the brewing industry toward the light lagers, also known as pilsners. But in the 1980s a new breed of brewers started to gain notice. They became known as "craft" brewers, defined by their small size, independence from large breweries, and use of traditional ingredients. Because of their size, they were also called "microbreweries." Washington state proved to be an incubator for many. One of the nation's first microbreweries and brewpubs was Yakima Brewing and Malting Company, founded in 1982 in Yakima by a Scotsman, Bert Grant.

Craft brewing was slow to gain traction and was largely ignored by the major breweries for years, but by the late 1980s and early 1990s a significant portion of the country's beer consumers began to demand the darker, richer brews that came from these small independents. From that point on, the popularity of the microbrews exploded. In 1980 there were eight craft brewers in the entire country; by 1994 there were more than 1,600.

Although the production volume of the micros was relatively small, the traditional recipes they used called for considerably more barley malt than was used in the pilsners that were still the mainstays of the major breweries. The heavier use of malt benefited Great Western, but did not become truly significant until the majors -- primarily Anheuser-Busch, Miller, and Coors -- realized that they were missing out on a significant sector of the market. The demand for malt increased substantially when they all started brewing new products using traditional recipes.

New Growth, More Owners

Great Western responded to the growing popularity of the darker and heartier brews by supplementing its product line. In 1995 the company spent $12 million to build a roast house and installed new drum roasters and a new kiln to produce the colored malt preferred by craft brewers. This new plant was the first of its kind in the U.S. and did much to sustain the regional microbreweries. The company nurtured even the smallest craft brewers, often selling small amounts of various malts by the pick-up load or in cardboard boxes.

With the malt market stabilized and growing again, Great Western once more became a popular takeover target, going through three ownership changes in the next 14 years. In 1995, ConAgra Foods and Tiger Brands, a South African company, bought Canada Malting and other maltsters, forming a new corporation called ConAgra Malt. In 2006, Castle Harlan and CHAMP Private Equity bought ConAgra Malt. Barely three years later, in 2009, GrainCorp, a world-wide producer of malt, purchased the combined companies, which included Great Western.

Today and the Future

Great Western and the Port of Vancouver have a long history together, and continue to work cooperatively for the benefit of each. As the malting plant has expanded over the years, the Port has been able to meet its needs for additional space and has helped provide the transportation infrastructure that allows Great Western to economically ship both its raw material and its finished products. The fact that it has remained in the same location for over 75 years illustrates the strength of their relationship

The Port of Vancouver, for its part, has seen growth that dwarfs even that of its long-time tenant. In 2007 planning began for a major renovation and extension of the Port's rail system. As part of this project, portions of the Great Western Malting facility must be razed, including the original Drum House and its popular and historic Tap Room. Great Western Malting, the Port, and the responsible federal and state agencies entered into an agreement in 2009 that recognizes the historical significance of the site and provides for the documentation, preservation, and relocation of the Tap Room and its contents.

As part of the preservation planning, Archaeological Investigations Northwest Inc. inventoried, described, and evaluated the historical value of the portion of the plant that will be sacrificed and made recommendations for its preservation. It also prepared for the Port a history of Great Western Malting in which the author summarized the facility's historical significance:  

"[Great Western Malting's] success is strongly connected to the buildings that comprise the production facility; they stand as physical evidence of not only the company’s continuous growth, but its continual innovation. The Drum House was the first malting facility constructed in the Pacific Northwest, and is one of the last facilities in the world to utilize this process. At the time of their construction, GWM’s grain silos were some of the largest structures in Vancouver, Washington. The Fleximalt Plant was one of the first of its kind to be constructed in the western United States. The Roast House contains the first roaster to be operated within a malting facility in the United States. GWM has become a dominant force within the local brewing community, and is now affiliated with one of the largest malt producers in the world. Much of this success can be attributed to its location at the Port of Vancouver, which afforded GWM competitive advantages against larger and more established malt producers in the Midwestern and Eastern United States" (Andrea Blaser, "History of the Great Western Malting Company").

Great Western Malting has carefully preserved its good name and its individual identity through decades of dramatic growth, mergers, and multiple changes in ownership. It is the oldest malting company in the western United State, and although it is now just a single piece of one of the world's largest malt producers, it continues to do business right where it got its start, using the name it was given at birth.


Sources:

Andrea Blaser, "Great Western Malting Company Tap Room Treatment Plan, Port Of Vancouver, Washington," (Archaeological Investigations Northwest, Inc.), copy in possession of John Caldbick, Seattle, available through the Washington State Department of Archaeology and Historic Preservation;  Andrea Blaser, "History of the Great Western Malting Company" (Archaeological Investigations Northwest, Inc.), copy in possession of John Caldbick, Seattle, available through Port of Vancouver; Encyclopedia Britannica Online, "Beer," (by Thomas W. Young), http://www.britannica.com/ (accessed October 5, 2011); David J. Hanson,  "Puritans To Prohibition," Alcohol Problems and Solutions website accessed October 5, 2011 (http://www2.potsdam.edu/hansondj/FunFacts/PuritansToProhibition.html); "Great Western Malting Co.," Brewers Market Guide website accessed October 6, 2011 (http://www.brewingtechniques.com/bmg/great.html); "Our Company," Great Western Malting website accessed October 4, 2011 (http://greatwesternmalting.com/our-company); "The History of Beer and Brewing in the United States," BeerInfo.com website accessed October 5, 2011 (http://www.beerinfo.com/index.php/pages/beerhistory.html); "Best Barley Sample Will Win Combine," Spokane Daily Chronicle, August 23, 1948, p. 5; Dale P. Van Wieren, American Breweries II,  First ed. (West Point, Pennsylvania: Eastern Coast Brewiana Association, 1995); Don Scheidt, "Beer in Washington State: Some Highs and Lows," The Seattle Weekly, April 13, 2005 (http://www.seattleweekly.com/); "Hop," Purdue University Department of Horticulture website accessed October 6, 2011 (http://www.hort.purdue.edu/newcrop/afcm/hop.html);  HistoryLink Online Encyclpedia of Washington State History, " Pathos Instead of Celebration Closes New Year's Eve in Seattle on Last Night Before Prohibition on December 31, 1915" (by Greg Lange), http://www.historylink.org/ (accessed October 6, 2011); "This Day in History: March 22," History.com website accessed October 6, 2011 (http://www.history.com/this-day-in-history/fdr-legalizes-sale-of-beer-and-wine); "DIRECTORY:  Illustrated Histories of over 50 Western Breweries,"  BreweryGems.com website accessed October 6, 2011   (http://www.brewerygems.com/histories.htm); "About Galland Henning Nopak: History," Galland Henning Nopak website accessed October 5, 2011 (http://www.nopak.com/about-us.html);  "About Rahr Malting Co.," Rahr Malting website accessed October 5, 2011 (http://www.rahr.com/);  EH.Net Encyclopedia of Economic and Business History,  "A Concise History of America's Brewing Industry" (by Martin H. Stack), http://eh.net/encyclopedia/ (accessed October 5, 2011).


Related Topics:   Buildings | Business | Industry

Licensing: This essay is licensed under a Creative Commons license that encourages reproduction with attribution. Credit should be given to both HistoryLink.org and to the author, and sources must be included with any reproduction. Click the icon for more info. Please note that this Creative Commons license applies to text only, and not to images. For more information regarding individual photos or images, please contact the source noted in the image credit.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License
Major Support for HistoryLink.org Provided By: The State of Washington | Patsy Bullitt Collins | Paul G. Allen Family Foundation | Museum Of History & Industry | 4Culture (King County Lodging Tax Revenue) | City of Seattle | City of Bellevue | City of Tacoma | King County | The Peach Foundation | Microsoft Corporation, Other Public and Private Sponsors and Visitors Like You