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The American Russian Commercial Company, also known as the Ice Company, was founded by Peter Kostromitinov, employee of the Russian American Company and George Kostromitinov’s uncle, and a few of San Francisco’s elite. This new company was initially organized with the purpose of importing Alaskan ice to be distributed in California and beyond.
Southeast in Sepia: The Ice Company 072617 AE 1 Caitlin Rogers, for the Capital City Weekly The American Russian Commercial Company, also known as the Ice Company, was founded by Peter Kostromitinov, employee of the Russian American Company and George Kostromitinov’s uncle, and a few of San Francisco’s elite. This new company was initially organized with the purpose of importing Alaskan ice to be distributed in California and beyond.

The Old Russian Sawmill purchased by the American Russian Commercial Company in 1868, sawmills were utilized by the company not to produce timber but the necessary sawdust to insulate ice for shipment. Image courtesy of the Sitka History Museum.

Wednesday, July 26, 2017

Story last updated at 7/25/2017 - 6:05 pm

Southeast in Sepia: The Ice Company

The American Russian Commercial Company, also known as the Ice Company, was founded by Peter Kostromitinov, employee of the Russian American Company and George Kostromitinov’s uncle, and a few of San Francisco’s elite. This new company was initially organized with the purpose of importing Alaskan ice to be distributed in California and beyond.

As the harvest and sale of furs faded in the 1840s, the Russian American Company investigated other industrious avenues. While other ventures, such as coal mining and whaling did not have the same success as the fur industry, a new cash crop was found with the ice harvest. In 1850, ice was an expensive luxury in San Francisco, but this was during the California Gold Rush and such luxuries could be afforded. Backed by this sudden surge in population and demand for higher living, a New England company made the first move by sending ice from Boston via Cape Horn to San Francisco. The market proved justifiable, but shipping ice in this way was incredibly expensive and the demand exceeded the supply, and this created the opportunity for enterprising California capitalists to corner the market.

An initial contract for the sale of Alaskan ice was first made in 1851 between a group of San Francisco businessmen and Chief Manager Nikolai Rosenberg of the Russian American Company. This contract provided the purchase of 250 tons of ice at $75 per ton ($2,311 in 2017) and was met with great success. By October of that same year a new contract was drawn stating that the Russian American Company would furnish the American Russian Commercial Company (ARCC) with 1,000 tons annually at $35 per ton and was binding for three years.

According to the company Certificate of Trustees, the corporation was designed, “For the purpose of importing Ice from the Port of New Archangel and other Ports in the Russian Settlements in North America, into the State of California.” However, historian Richard O. Cummings suggests that the ARCC acted as a ploy to supply Alaska with necessary provisions during the Crimean War (1853-1856). During this time Russia feared that Alaska would fall into British hands, and to protect itself, the Russian American Company devised a clever ruse.

The onset of the Crimean War in 1854 put Russian America in jeopardy and at risk of attack from the British. The Russian American Company could not defend its holdings from British forces and the Hudson’s Bay Company. An agreement of marine neutrality between Russian and English colonies was reached in 1854, but the news was delayed in getting to the Russian colonies and anxieties reached a fever pitch. Peter Kostromitinov, who was serving as the Russian Consul in San Francisco at the time, devised the idea of a sham sale of Alaska to the San Francisco based ARCC. The contract for the fake purchase was drawn up in early 1854 and sent to Russian Minister Eduard de Stoeckl in Washington, D.C., for approval. Stoeckl, along with Secretary of State William Marcy and Senator William Gwin, agreed that the scheme was entirely too transparent and would further worsen Russian-British relations, and the deal was dropped. Afterwards, Stoeckl requested that Kostromitinov sail ARCC ships under the American flag to protect ships from seizure, but the ARCC president did not agree with this proposal as he feared that it would cause controversy.

Whether the true purpose of the American Russian Commercial Company was to act as a blind or not is still up for debate. However, it cannot be argued that the sale of Alaskan ice proved to be a successful enterprise before and after the threat passed.

While the ARCC was not incorporated until May 1853, the company started production in Sitka in 1851 with the creation of Swan Lake in Sitka. Historical resources suggest that present-day Swan Lake was originally a series of ponds and in 1851 the area was dredged to create Swan Lake (Russian: Lebiazh’e, Tlingit: X’wáat’ Héen Áak’u), with an area of approximately 22 acres. The Russian American Company built icehouses (which held a capacity of 10,000 tons) and sawmills in Sitka for ARCC use. From the beginning, the Russians realized that Sitka’s temperate climate did not allow for the appropriate conditions for sufficient ice production, which led to the establishment of ice production in 1852 on Woody Island, off Kodiak. This depot quickly became the main source of ice for the ARCC. Lake Tanignak was dammed to increase depth and size to around 40 acres. The ice company brought the first rails and horses to Alaska, and the first road in Alaska was constructed around Woody Island to exercise the horses used to power a saw which cut ice blocks. The first oats in Alaska were also sown on Woody Island to feed the horses. At its height, the ARCC supplied ice to California, Mexico, Nicaragua, and to countries in South America.

The American Russian Commercial Company not only sold ice but also distributed red salmon. Sixteen days before of the formal transfer of Alaska to the United States, Prince Dmitrii Maksutov, the last Chief Manager of the Russian American Company, sold five pieces of property to the ARCC. One of these listings was Redoubt Lake, about 10 miles southeast of Sitka. The ARCC operated the fishery at Redoubt until the spring of 1883, and was then sold to businessmen from San Francisco. The deed also provided for the sale of the foundry, ice houses, the flourmill and sawmill at Sitka to the ARCC. However, the company did not operate the foundry or the flour mill after 1868. The other ARCC properties in Sitka changed hands shortly after 1870, with the focus of the company being production on Woody Island.

In 1868, the Russian American Company sold its interests in ARCC to Hutchinson, Kohl, and Company (forerunner of the Alaska Commercial Company). Ice production on Woody Island continued until 1879 and production continued sporadically in Sitka until 1913 when Sitka Cold Storage Company opened. Between 1852 and 1859 over 7,000 tons of ice were shipped from Alaska via the ARCC, earning the company more than $520,000 (>$15,000,000 in today’s economy), but this success was short lived. The advent of the railroad gave Californians access to cheaper ice from the Sierra Mountains, and the invention of artificial ice drove prices even lower that it was not worth the risk to harvest ice in Alaska and the mismanagement of the business led to the disintegration of the company.

Caitlin Rogers is a fellow at the Sitka History Museum.