Wednesday, November 19, 2014

The Tomato Paste Land Rush

When you search on canneries in San Jose, you'll find a sudden explosion in tomato canning starting around 1915, and lasting well into 1918 or 1919.  One cause was all the new Italian immigrants who considered tomatoes and tomato products to be essential for their dinner tables.  In previous years, those immigrants had been buying imported tomatoes from the old country, but World War I made those harder to get.

Actually, there's a fair amount more to the story, not only in terms of what happened to the imported tomatoes, but also in terms of what the American producers had to do in order to take that market. How those different canners attacked the the Great Tomato Paste Land Rush doesn’t sound that unlike things today in the Internet era.

The actual details come, of course, from a court case. (Scroll a third of the way through the PDF to hit the story of Pastene vs. Greco)  And it's a good one too - full of drama, and direct quotes, with a cast of canners stepping on the witness stand to support one side or another, horror stories from the engineer trying to make experimental machinery work, and arguments over a farmer’s size estimates for the “tomato crop that got away”.

Greco Canning Co. Ad from October 1921 Western Canner and Packer

Our two main characters are Victor Greco and P. Pastene of New York.  Greco was the Elon Musk of the Valley of Heart's Delight, continually was coming up with new ideas for products to can, and experimenting with the machines needed to make these.   In 1916, three years after he started the cannery, Greco figured out that he could make a fortune if he could figure out how to make tomato paste. Pastene was an east coast wholesaler looking desperately for a source of tomato paste.  And just like Silicon Valley, these two men ended up in court because sometimes plans don't go the way you want.

It's 1915; World War I is raging, and Austria and Italy are fighting toe-to-toe in the Alps.  In 1916, Italy realizes that food for its people is scarce, and places export restrictions on canned tomatoes.  France does the same. The U.S., with a huge Italian immigrant population (three million Italian immigrants arrived between 1900 and 1915), is now desperate for tomato paste. Prices double and triple to 10 cents a can, much more than the average immigrant can pay.

But Santa Clara Valley canners were already good at growing and canning tomatoes, and how hard could it be to evaporate a bit more water?  Victor Greco decides to see if he can make tomato paste; with a bit of work on the stovetop, he sees that the process of evaporating away the water is easy.

Greco and Pastene start trading letters in January, 1916, with Greco noting:

"Regarding Naples Tomato Sauce packed in small 6 oz. tins, in view of the present conditions in Europe which makes it almost impossible to receive any of this commodity from said country, we are contemplating to pack about 60,000 cases of the article above mentioned which will be sold as a substitute of the Imported.
As we are Italian and know what the Italian people must have and being very familiar with the method of manufacturing this article, you can rest assured it will be the equal of that imported from Italy..."
"P.S. We are located in the heart of the Santa Clara Valley where some of the finest tomatoes in the world are grown."

Pastene, on a visit to the West Coast in April, 1916, hears about the great plan, and signs a contract for 3,000 cases.

So now Greco Canning needs to scale up on the tomato paste project. Victor Greco goes to San Francisco, bringing drawings of the evaporators used by the finest canners in Naples. Greco convinces the Oscar Krenz Manufacturing Company, normally active in coppersmithing, to make some vacuum pan evaporators in the the Neapolitan style - no one else had tried making such equipment before in the U.S. Greco installs it in his cannery and gets to work making tomato paste, with engineers from Krenz helping get the machinery running smoothly.

But there’s risk here: there’s the usual questions about getting sufficient fruit, but Greco is also trying novel machinery to cook the tomato paste, a process that hasn't been tested at scale, smaller 6 oz cans to match the Italian style, and is even trying fiberboard boxes (instead of the traditional wooden boxes) to save weight. That’s very Silicon Valley - it’s a new product and a bit risky, but Greco thinks he can pull it off.

And they hit snags. Greco had chosen the vacuum pan approach (boiling the tomatoes at a lower temperature in a partial vacuum) because it concentrated the tomato flavor better with less heat. The Italians used to cook down tomato sauce in an open pot, but the better Italian canners have rejected that approach for the vacuum pan. Greco's variant on the machinery is a 750 gallon cooking vessel eight feet tall with one inch tubes to circulate the stuff being evaporated near the heat. Unfortunately, the prototype's narrow tubes - appropriate for reducing sugar solutions - are too small for the thick tomato pastes. The tomatoes keep sticking into the tubes and burning, forcing the repair crew to shut down the process and clean out the entire machine. Sometimes they need to use electric drills to remove the hardened paste, and once it took them five days to get the machinery back into action.

It didn’t help that it was a bad year for tomatoes. Late frosts in May killed off some seedlings, and early rains in October and November ruined the crops. The normally ten week season was a month shorter than usual, with many tomatoes failing to ripen. William Greer, farming on “Mr. Kell’s place” (probably along Almaden Road) delivered 3.5 tons per acre to the cannery, but six times that amount was left in the fields, spoiled. J. L. Mosher, a farmer and orchardist, testified to an equally bad year, delivering two tons per acre instead of 12. “I have not been in the tomato business since.”

And now there was a problem. Greco had sold 18,000 cases of tomato paste that season (down from the 60,000 case goal) for prices between $6.50 and $8.50; between the problems with the vacuum pans and lack of tomatoes, he managed 3,500. Pastene was unhappy from several angles. He didn’t get the tomato paste he’d ordered. He wasn’t happy with the quality (some of the tomato paste had a “consistency not much greater than water.”). He felt that Greco had tried out a risky project without warning him. To add insult to injury, when he did receive the tomato paste, the railroad had billed the shipment at the freight rate for tomato sauce, twice the shipping cost for catsup, canned tomatoes, and other tomato products. (Oh, the railroad tariffs were twisted in those days.)

And even with all that disappointment, Pastene closed his last letter to Greco asking about tomatoes. "We would like to treat with you for a purchase of next season's pack. What can you offer?"

When the lawsuit over the missing and substandard tomato paste made it to court in 1920, Greco testified. “It was a defect in the machinery.” The farmers came to the witness stand and lamented the horrible season where the rain and frost forced them to leave behind a good part of their crop. Several canners (including Elmer Chase for the Canner’s Assocation and Richmond Chase, R. W. Crary from the California Cooperative Canneries, and Charles E. Hume of the G. W. Hume company, defined a “short pack” and how equipment failure was a valid reason for a canner to not deliver product.

H.T. Rigg, the engineer hired away from San Jose Ice and Cold Storage to run the plant shared stories of drilling out blocked tubes and warning Greco that they weren’t going to meet deadlines:

“The first date is October 10th when I began [keeping a production diary]. That day I was delayed two hours and ten minutes on account of the pulper, that is, the machinery on the lower floor. Then we were delayed two hours cleaning the pans, No. 2 vacuum that same day. The delay of the pulper necessarily stopped the vacuum. There is a continuous feed from the pulper to the vacuum. There was a total stoppage on that day of four hours and ten minutes… And on the 11th we started at 6 a.m. in the morning and stopped at 9:20 in the evening and stopped two hours for the pulper again. Stopped another hour and 30 minutes for lunch. Then we stopped again to clean No. 2 vacuum pan. This was on the 11th. On the 12th No. 1 pan stopped 23 hours for cleaning. This 23 hours carried us into the night. We worked during the night cleaning the pans. Mr. Greco was there off and on around where I was working. I cleaned it out by using an electric drill. The product had so caked and burned inside of the tubes that it had to be drilled out by an electric drill…”

That went on for days: problems with the vacuum plans clogging, failures in the pulper, cans jamming in the sealer machinery. The rotary cooker broke. All-night repair sessions aren’t unique to modern-day Silicon Valley.

And just as things were working, a lack of tomatoes and nothing to work with.

For the other side, Charles Bentley, of the California Packing Corporation, declared that they’d had no problems finding tomatoes to pack in the 1916 season, and that it was truly a rare farm in the Santa Clara Valley that could manage 25 tons per acre. Charles Davis, the general manager for the California Conserving Company in Oakland, described that he’d had fine luck with the closed kettle style of tomato paste production in the 1916 season, and that he’d treated “salsa de pomidoro” as an experimental product in his first season. When the judge asked him about the Greco machinery, Davis sounded a bit mystified about why they were using such a complicated method.

Judge: “And the process involved a forcing of the material being treated through a set of tubes, instead of being boiled in pans…”
Davis: “No, that’s a new one on me.”
Judge: “Your method did not involve that?”
Davis: “No, nothing of the character.”

The lawsuit also contains many of the letters between Greco and Pastene, at first in the spring of 1916 with a an optimistic tone: "being very familiar with the method of manufacturing this article", then with Pastene hopeful in October: “We certainly trust that you will find that you have been over-conservative in making this (25% delivery) estimate. Greco responds stoically in October with what he can deliver. “Twenty per cent is about the very best that we are going to be able to fill. Regardless of this, so as to make up a minimum car[load] we have shipped you 665 cases for which enclosed find copy of invoice…. we are now planning for a new arrangement for next season and will install a different system of vacuum pans, and hope to be more fortunate in our pack.” And finally anger from Pastene in December 1916: “This is not a fair deal and one unworthy of yourselves and unjust to us who trusted you, and were one of the first to sign your order.”

Victor Greco’s 1916 dash into the tomato paste market may have ended awkwardly, but he managed to fix the line in future years. Halfway through the 1917 season, he junked the old vacuum pans and tried a new design that clogged much less often. Two years later, at the beginning of the 1919 season, Edith Daley visited Greco Canning. Toma-Butter Soon To Appear on Every Table”, the piece started, as Edith explained how Victor Greco would introduce tomato paste to the American home. She also hinted at the complexity of the machinery:

The “heart” of this equipment is a 500 horse power boiler, 55 feet high and containing 200 four inch tubes each 24 feet long. This tremendous energy producer is exhibited with pride by Mr. V. V. Greco who tells you that it is the “Biggest boiler on the Pacific Coast”. This leviathan of boilerdom is manufactured by the Wikes Boiler Company of Saginaw, Michigan. It looks big enough to “boil” Lake Michigan, Saginaw included!… Two immense storage tanks furnish food for a battery of twelve vacuum evaporators with a capacity of 1500 gallons each.”

After all he’d been through in 1916, Greco certainly would have shown off the new machinery with pride. With twelve vacuum pans and twice the capacity each, he could produce a thousand cases of tomato paste a day, and could have filled the fateful order from Pastene with a couple days work.

But Greco probably had competition now. Even Victor's brother, Anthony, got into the act, leaving Greco Canning to start his own "Anthony Greco Cannery", producing $105,000 in tomato paste in the 1917 season. Upstarts like Contadina and Salsina Canning both started canning tomato paste in San Jose in 1917. Gus Lambrosa, one of the founders of Salsina, explained his vision to the Evening News: '“This country sends every year about seven million dollars to Italy for tomato paste, which is used in macaroni”, said Lambrosa today. “There is no reason why this money should not be kept in this country.”'

Lambrosa got his wish. Contadina was canning 150,000 cases of tomato paste a season by 1922, and Americans (immigrant and non-immigrant) got their tomato paste from California fields.

As for the lawsuit, which finally got settled in the early 1920's, I'd probably agree with the verdict: Victor Greco took a chance on moving into tomato paste, but hadn't completely worked out the process and the machines he'd need to do the job. Pastene was right to demand payment.

"During the year 1916, the peeled tomato and hot sauce departments of our canning plant were operated during the daytime while the Salsa De Pomidoro department was operating day and night. We would have made more profit out of the Salsa De Pomidoro. It was our interest to run the Salsa De Pomidoro plant at full capacity. We ran it to the fullest capacity that we possibly could. In other words, while running it, we had considerable interruptions, and, therefore, the capacity was reduced, owing to those interruptions." -- Victor Greco, from his testimony.

On the other hand, it's a very Silicon Valley story. Victor Greco's started a cannery; he's been running it for a few years, and he sees a big market opportunity. Grabbing for that - rushing to make tomato paste, and assuming that he'd work through any bugs - seems like the right choice for someone trying to make a big splash. All the other stories: toma-butter branded tomato paste, Grepo grape syrup, the Bottled Pure Juice Company making tomato and artichoke-based drinks - all suggests that Victor Greco was going to try for the big score. I think he'd fit right in to the modern Silicon Valley.

(P. Pastene & Co., Inc. vs Greco Canning Co, case #16076, Southern Division of U.S. District Court for Northern District of California, Second Division, August 30, 1920. We get to see all the letters and testimony thanks to Greco's appeal of the initial ruling.) Scroll about a third of the way through the PDF to find the Pastene vs. Greco material.

Previous versions of this article declared that Victor Greco had made artichoke-based drinks and ran salt ponds. We were mistaken; the crazy inventor in the family seems to have been Victor's brother Anthony, who broke away from Greco Canning to make his own tomato paste cannery, fought his brother for a string bean canning tool, and believed that the quickest way to dispose of a debt was to tear the note up and flee to Oregon.

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