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The Hudson’s Bay Company
A TRICENTENNIAL REPORT Having worked like a beaver to overcome three centuries of plunging thermometers, recalcitrant Indians, and fierce competitors from Quebec and the U.S.A., it remains today the continent’s most durable trading enterprise
April 1970 | Volume 21, Issue 3
That same year the company declared its first dividend, a thumping one of 50 percent. Not all was well, however. The French were growing aggressive. Stung by Radisson’s defection, mariners of the Quebec firm that once had employed him seized a Hudson’s Bay Company ship in 1685 and carried it as a prize to the St. Lawrence. There a new governor greeted the raiders not with reprimands but with congratulations. The next year the same governor sent thirty soldiers and seventy voyageurs overland to James Bay. Surprise was total—and, anyway, the English cannon pointed toward the sea. The French captured the three southern posts. Only Port Nelson remained in English hands.
A first the losses caused surprisingly little hurt. The Nelson River, more than the streams of James Bay, tapped the heartland of the north, and Indians flocked down it with their furs. In 1690, flushed with euphoria, the London directors voted a three-for-one stock split and then declared a 25 per cent dividend on the augmented total.
The move was premature. At the bay trade had already slacked off. The persistent French had at last pushed through the granitic Shield into the heartland and were diverting part of its furs to the St. Lawrence.
The breakthrough was a triumph in environmental adaptation. Even as recently as the days of Groseilliers the colonial fur monopoly had continued to urge the Indians to sell their furs at controlled rendezvous sites along the St. Lawrence. As the white population grew, however, increasing numbers of unlicensed coureurs de bois took to breaking the pattern. They smuggled goods to distant Indian villages, picked up the furs on the spot, and smuggled the pelts back to illegitimate market places.
In an effort to meet this shadowy competition, the monopoly began sending its own traders among the Indians. A race began. Building on years of experience, the aggressive French learned how to take their birch-bark canoes westward to the region north of Lake Superior, near Lake Nipigon. They managed to arrive just as the Indians of the area were starting their trips to Port Nelson, soon rechristened York Factory. But why make the journey when the French were at hand? The Indians bartered as many of their finest pelts to the newcomers as the traders could handle in their canoes, and then let the surplus, mostly coarser, cheaper furs, go down the rivers to York.
The English reaction was stodgy but firm. The traders at Hudson Bay lacked the long experience with Indians that their rivals possessed. They were afraid of the vast, silent lands of the interior. Moreover, they could not find on those barren coasts the birch bark and cedar necessary for building canoes. In the face of these difficulties it would be better, the directors decided, not to compete in the interior but to step up efforts to bring more Indians to York Factory. After all, the English, too, had advantages. The quantity of merchandise that the French could carry over the long canoe routes from Montreal was limited. York Factory, by contrast, was stocked by ocean ship with an abundance of superior cloth, ironware, and tasty Brazilian tobacco. If a qualified emissary were sent among the Indians to urge these truths, the flow of trade would surely resume.
The messenger chosen for the promotional trip was Henry Kelsey, aged twenty. Kelsey had come to Port Nelson about the same time as Radisson, in 1684. He had accepted the new world with a boy’s wide-eyed delight. Unlike most of his fellows, he preferred the nomadic camps of the Indians to the boredom of the more comfortable trading posts. Carefree journeys along the bleak shores of the bay soon brought him a reputation as a traveller, and when the matter of a selling trip among the Crée and Assiniboin arose, he actually wanted to go.
He wandered joyously for two years. He kept a record of sorts, partly in doggerel. (“In sixteen hundred and ninetyth year / I set forth as plainly may appear …”) It is not possible to tell from his meager descriptions exactly where he did go, but he certainly reached the Saskatchewan River, followed it westward a distance, and then turned south into the Great Plains, country that the French had not yet touched.
In 1692 he brought back to York Factory “a good fleet of Indians” and the first written description of the Canadian interior. Nothing came of it. During his absence France and England had declared war. Trade stagnated. Now and then warships of one nation or the other slid into the bay—the different posts changed hands repeatedly—and in 1697, during a climactic naval battle, Pierre Lemoyne, Sieur d’Iberville, sank a fiftytwo-gun English man-of-war and captured one of the supply ships she was escorting. The price of Hudson’s Bay Company stock crumbled from £260 to £80. For twenty-seven years, from 1691 through 1717, there were no dividends.
In Europe, English arms were more successful. The Treaty of Utrecht (1713) recognized the fact by confirming English sovereignty over the Hudson Bay drainage system and returning to the company the posts held by the French. The long work of rebuilding then began.
One new post, massive Fort Prince of Wales, was erected at the mouth of the Churchill River, far north of York Factory. The purpose was as conservative as ever—to lure in Indians, this time the Chipewyan, who lived around the icy shores of Great Slave Lake. Why do more? A postwar depression had slowed the French, and trade was dropping by default into English hands. Costs of less than twenty thousand pounds a year produced annual profits ranging from four thousand to ten thousand pounds, to be distributed among fewer than a hundred stockholders.