The Business of Survival: Competition and Cooperation in the Shanghai Flour Milling Industry
DANIEL J. MEISSNER is an assistant professor in the History Department at Marquette University. Contact information: 325 Coughlin Hall, History Department, Marquette University, Milwaukee, WI 53201, USA. E-mail: daniel.meissner{at}mu.edu.
At the turn of the twentieth century, American and Chinese millers were locked in a fiercely contested battle for control of China’s flour market. Imported American flour had dominated Chinese urban markets since the early 1880s, but the founding of a modern native milling industry in 1900 had initiated a commercial war that pitted the great flour corporations of the Pacific Coast against the independent mill owners near Shanghai. Although the anti-American boycott of 1905 had boosted sales for Chinese mills and sparked growth in the native industry, the period between 1905 and 1909 severely tested the ability of the young industry to survive foreign competition. A high silver/gold rate, low transpacific shipping rates, and bumper wheat harvests in the Pacific Northwest lowered the relative cost and enhanced the market appeal of American flour to Chinese brokers. Conversely, severe flooding in China’s wheat-producing regions forced curtailment or even cessation of production for some native mills. Facing catastrophic reductions in their wheat supplies and markets saturated with American flour, Chinese millers devised alternative business strategies and implemented collaborative measures to ensure the solvency of their mills. This study examines the details and dynamics of the competition between native and imported
flour and highlights the decisive measures Chinese mill owners employed to assure the survivability of the modern milling industry in China.
If there were any question . . . or doubt about the Chinese becoming a flour-eating people to a considerable extent, the building of a mill by the Fou Foong Flour Mills Co. at Shanghai would dispel it. It is not in the nature of things for Chinese businessmen to act hastily, so that the erection of this mill may be regarded as an index of the future.
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