The American Fur Company represented John Jacob Astor's bid to challenge the dominant Canadian fur companies operating within the boundaries of the United States, namely the North West Company and the Michilimackinac Company. A poor German immigrant, Astor became involved in the fur trade in 1784 in New York. By the end of the century, Astor had gained dominance of the fur trade in the Northeast by transshipping American furs through Montreal to England, bypassing British tariffs on American furs. Astor then sought to gain control of the Mississippi-Missouri trade through St. Louis, but found his attempts blocked by Auguste Chouteau, one of the founders of St. Louis and its fur trade. In light of the Louisiana Purchase (1803) and the success of Lewis and Clark's explorations (1804–1806), Astor met with President Thomas Jefferson to discuss establishing a Pacific-based fur company. On 6 April 1808 the American Fur Company was incorporated in New York with $1 million capital stock and with Astor as the sole stockholder. In 1811 agents of the American Fur Company established Fort Astoria in Oregon.
The War of 1812 forced Astor to sell Astoria to the British and reassess his efforts along the Canadian border. On 28 January 1811 Astor had created the Southwest Fur Company to coordinate his American Fur Company with the North West Company and the Michilimackinac Company as partners and joint stockholders. He then attempted to buy into the Missouri Fur Company of Manuel Lisa. Again the war interfered, but this time Astor was able to take advantage of it. By 1817 Astor had bought out his partners and gained control of the Mississippi Valley posts. He restructured the Southwest Fur Company as the Northern Department of the American Fur Company. He was well on his way to monopolizing the western fur trade.
In 1823 Astor used the fur brokerage firm of Stone, Bostwick and Company of St. Louis as his agents for the American Fur Company's Western Department in that city, giving him his long desired foothold there. Three years later, Astor negotiated with Bernard Pratte and Company to take over control of the Western Department. Pratte did so after entering into an agreement with William Ashley and the Rocky Mountain Fur Company, Astor's closest competitor in the United States. This agreement made Astor an equal participant with Ashley in a trapping and trading expedition into the Rocky Mountains.
Astor viewed the American government's Indian factory system as a major obstacle to the spread of his fur empire. The factory system regulated trade with the Indians and sharply curtailed the amount of liquor offered them in barter. Using interested men such as Lewis Cass, governor of the Territory of Michigan, and Thomas Hart Benton, U.S. senator from Missouri, Astor got the factory system abolished in 1822. Liquor then began to flow in large quantities up the Missouri to the Indians as the Western Department expanded. Astor stifled competition by fair and foul means. Under pressure from Astor's lobbying, Congress excluded foreigners from the trade in 1816 and, eight years later, designated specific places where trade could be conducted, greatly hampering the American Fur Company's competitors.
When the Hudson's Bay Company merged with the old North West Company in 1821, some nine hundred employees were dismissed. They formed the Columbia Fur Company, operating between the upper Mississippi and the upper Missouri Rivers. In the summer of 1827 Astor bought out the Columbia Fur Company and reorganized it as the Upper Missouri Outfit, centered at the Mandan villages on the northern Missouri River. Kenneth McKenzie was put in charge, and he immediately established Fort Floyd at the mouth of the Yellowstone River. Soon renamed Fort Union, it was one of the greatest American posts in the region. The combination of the Upper Missouri Outfit and the Western Department gave Astor near total control of the Missouri River fur trade.
McKenzie focused on a series of trading posts and forts where the Indians might come to trade. He and the American Fur Company were startled when the Rocky Mountain Fur Company took its trade to the Indians and the independent fur trappers, establishing the rendezvous system. For six years the Rocky Mountain organization and the American Fur Company struggled for dominance in the rich Rocky Mountain trade. In 1831 McKenzie won a coveted trade agreement with the Assiniboins and Black-feet that opened up the Marias-Missouri River region. In 1832 Fort McKenzie was established near the mouth of the Marias River. The Rocky Mountain Fur Company countered with Fort Cass at the mouth of the Bighorn River as a center of the Crow trade, but shortly it was taken over by the American Fur Company. McKenzie then pushed for and succeeded in getting the steamboat Yellowstone built and then navigating it on the upper Missouri-Yellowstone watershed in 1832.
However, the days of the fur trade were numbered. In 1834, John Jacob Astor withdrew from the American Fur Company as it became clear that it would have to withdraw from the Rocky Mountains. Astor sold out at a time when the company had made, in its previous decade, profits and dividends of over $1 million. The Western Department went to Bernard Pratte, Pierre Chouteau and Company. The Northern Department was purchased by Ramsay Crooks and nine others who retained the name American Fur Company. Crooks and his associates confined the company's operations to the area between Detroit, the Ohio River, and the Red River of the North. They operated vessels on the Great Lakes and established fisheries on Lake Superior. They marketed the furs of Pratte, Chouteau and Company and tried to establish a banking business in the area. The American Fur Company failed in 1842, however, and was reconstituted in 1846 as a commission house before finally being dissolved in 1845.
Bibliography
Berry, Don. A Majority of Scoundrels: An Informal History of the Rocky Mountain Fur Company. New York: Harper, 1961.
Blevins, Winfred. Give Your Heart to the Hawks: A Tribute to the Mountain Men. New York: Avon, 1973.
De Voto, Bernard. Across the Wide Missouri. Boston: Houghton Mifflin Company, 1947.
—Jerry L. Parker
