Krenholm Manufacturing Company

The Kreenholm Manufacturing Company (historical alternate spelling: Krenholm; et, Kreenholmi Manufaktuur; german: Krähnholm Manufaktur; russian: Кренгольмская мануфактура) was a textile manufacturing company located on the island of Kreenholm in Narva, Estonia, on the border with Russia. It is situated along the banks of the Narva River, by the Narva Falls; the Baltic Sea is approximately away, and there is a distance of to Saint Petersburg. It was founded by Ludwig Knoop in 1857, a cotton merchant from Bremen. At one point, the company's cotton spinning and manufacturing mills were the largest in the world; and Kreenholm was considered in its time to be the most important mill in Russia, owning 32,000 acres of land and employing 12,000 people. The factory was also the location of the first labor strike in Estonian history in 1872, which was also one of the earliest labor strikes across all of Imperial Russia. Throughout its history, the company faced different obstacles such as the possibility of closure after World War I and integration then separation from the USSR. In 1994, it was privatized after Estonia regained independence. The company went bankrupt in 2010, but continued limited operations after purchase by a new owner.

History

The site Pre-Kreenholm

The island that the factory would come to be situated on was located between two waterfalls on the Narova River overlooking the city of Narva. The territory was taken by the Swedish King Charles XII in 1700 during the Great Northern War, but the area was recaptured by Peter the Great in 1704 before being formally ceded to the Russian empire by treaty in 1721. The island is about one mile south of Narva and 85 miles west of St. Petersburg, lying directly on the modern day border between Estonia and Russia. Peter the Great reportedly said that the island was an ideal location for a water powered factory, however only a small sawmill inhabited the island throughout the 18th century as a wealthy German family of Narva merchants owned the island and used it as a vacation retreat. A German merchant attempted starting a small woolen factory on the island during the 1820s, however it proved unsuccessful and dissolved in 1831.

Mid-19th century and Kreenholms founding

In 1856 a pioneer of the Russian cotton industry, Ludwig Knoop, purchased the island of Kreenholm for 50,000 roubles from the heirs of a Narva merchant named Sutthoff. The manufacturing company was founded a year later in 1857 by Knoop, along with initial investors Kozma Soldatyonkov, Aleksey Khludov, Gerasim Khludov, Richard Barlow, and Ernst Kolbe. It was listed as a joint stock operation initially made up of 400 shares at 5,000 roubles each, valuing the company at 2 million roubles. The charter was approved by Tsar Alexander II on July 23rd, 1857. Knoop was the director general of the company until his death in 1894, Johann Prowe succeeded him in this position.

There was a great deal of civic pride within Narva upon the companies announcement and many guests attended the ceremonial laying of the cornerstone on April 30th, 1857. The original factory layout was made up of four large buildings but consisting of two factories. A "left" and "right" spinning building (known as a korpus) that together made up the spinning factory, along with a weaving factory designed with the same concept. The left korpus of the spinning factory was the first to be completed in the fall of 1857 and began operating in the fall of 1858, it would go on to be known as the "Old Half" or "Old Wing". The other three buildings were constructed in the following years with most of the work completed around 1862, although a continuously growing workforce at the factory led to housing expansion for workers throughout the 1860s. Along with the factories and dormitories, other buildings constructed during these years included: an apartment house for office workers, a house for foreman and supervisors, a small school building, a small infirmary, and a pharmacy.

The factories were built with limestone from a local quarry; all the structures for workers were built with logs. The Baltic Sea is only about 10 miles away and large cotton warehouses were erected in the harbor at the mouth of the river where cotton, imported directly from the United States or Liverpool, was stored and brought up the river to the mill as needed. A new spinnery was built on the island in 1870, and the company bought the adjacent Georgiyevsky Island in 1872 and built another mill there in 1899. The company also purchased Joala Manor and converted it into a mill in 1884, expanding it in 1890. The complex initially manufactured calico and received its raw materials from the Americas, Egypt, and India. The introduction of the St. Petersburg-Tallinn railroad opened up Central Asian markets. In 1893 it contained 340,000 spindles, 22,000 looms, and employed 7,000 people. Professor Gerhart von Schulze-Gävernitz visited the mills in the 1890s stating that "The whole place is a bit of England on Russian ground".

The carding and spinning machinery was from the firm of Platt Brothers & Co Ltd, in Oldham, England. Some of the looms were English, but most of them were made by the firm in its foundry and machine works, which were an adjunct of the mill. Riving power included 11 water turbines with a combined horsepower of 8,550, and supplementary steam engines of 700 horsepower were employed. Seventy per cent of the spindles were used in making yarns for sale principally among weavers in the St. Petersburg and Moscow textile districts. A specialty of the mill was 90s ply yarn, made from Egyptian yarn, for the rubber-tire manufacturers. The range of yarns produced was wide, running from 3s to 90s, and about 330,000 of the spindles were mules. The woven textile consisted mainly of print cloth in various types of construction and sateens, both woven from 34s warp and 38s weft. Practically all the goods were shipped to a factory in Moscow during this time.

The managers and assistant managers of the mills were mainly English, but also German and Russian. The laborers were Russian and Estonian, with Estonians making up the majority. The company provided a hospital, schooling for 1,200 children, a Russian Orthodox Church (built at a cost of $250,000) and a Lutheran Church (for the Estonians). Employees lived at the mill paying nominal rental. The owners provided a monthly allowance and board for workers who had spent longer than 30 years at the factory.

The strike of 1872

Cholera outbreak

There was a cholera outbreak within the factory that started spreading amongst workers on July 21, 1872. The provincial medical inspector Dr. Johann-Eduard von Falk investigated the event and dated the timeline of the outbreak from July 21 to September 21. He eventually reported 503 infections and 334 deaths at the factory, although these continuously revised estimates were challenged by both workers and outside contemporaries who though the true numbers were much higher. Amidst harsh working and living conditions, employees at the factory placed blame on the factory administration for being unable to respond to the rampant disease. On August 9th, masons who were working at the factory during this time requested back pay and permission to leave the factory until the disease subsided but were denied by management.

Strike origins

Upon denial of their initial requests on the same day, a group of 120 masons walked to the town of Narva to try and get help from the provisional government. Their meeting with the head of the regional office of Imperial Gendarmes was unsuccessful and the masons returned to the island that night. Once returning the factory, hundreds of masons began to solemnly march around the factory grounds in protest. The next day Major Nikolai Andreianov, the head of the regional office the masons had appealed to in Narva, received orders to assure better precautions against the epidemic were put in place at the factory and to dismiss any of the masons who still complained. Only 190 out of 450 of the mason artel members stayed at the factory, but less than a week later the cases of cholera peaked and those who deserted began to return to the factory. After this event the masons did not participate in anymore of the labor disputes.

During the workday of August 14th, just a few days after the masons demonstration, an estimated 500 out of 900 weavers at the factories walked out from their looms to gather at the factory directors office to demand better working conditions. This was likely initiated from the windows in the factory being left open for hygienic reasons, since workers were cold and wanted to close them. Ernst Kolbe, the director at the time and a major shareholder of the factory, asked for help from the gendarme office in Narva once the workers began demanding more than just for the windows to be closed. Major Andreianov arrived with three additional officers to oversee negotiations between Kolbe and ten weavers self selected from the workers. After making their demands, Kolbe claimed that the owners would need to come to the factory from Moscow in order to allow these changes, so the workers agreed to wait and continue working under their current conditions. Throughout the week that they waited more workers from the factory joined the collective of those asking for change, with many of these workers notably being spinners who were not originally apart of the crowd on August 14th. On August 21 the collective of workers negotiated their revised demands with two owners from Moscow, including the original and chief investor Ludwig Knoop, with the provincial governor present to intermediate. Over the course of the day some of the concessions were awarded to workers, including a slightly shorter workday and increased pay.

The strike

On September 9th a counter-petition was brought forward and signed by 24 workers who, likely in tandem with management, wanted for the old ways of Kreenholm to be restored. A group of workers was made aware of this in the factory tavern and marched towards the house of a factory manager to protest. The crowd was peacefully dispersed but the workers sent representatives to the gendarme office in Narva to appeal to the government about the counter revisions. A council with the governor was denied, although Andreianov suggested they take their concerns to the chief of police for the time being, whom the workers agreed to wait for. Later in the day, having heard of the previous nights disturbances from the perspective of the factory managers, the district chief of police Hakenrichter Girard arrested 6 delegates from the workers. They were sentenced to one week in the Narva prison for their actions the previous night.

The following morning at the factory some more workers were arrested. Having been informed about what had happened the previous day, 200 weavers left their stations to demand the release of their coworkers. The workers armed themselves with blunt objects and returned in the afternoon to surround the office that the managers and police were in, simultaneously blocking off the bridge connecting the island to its western shore. Another mob of workers, estimated to be a few hundred strong, marched to Narva to demand the release of the imprisoned workers from the jail house. The military was called in by local authorities and factory management. 220 soldiers arrived at nightfall and dispersed the crowd, maintaining order at the factory throughout the night. The following morning skirmishes continued between workers and soldiers as large contingents of workers still refused to work and tried to prevent their compliant contemporaries from being able to access the factory. By noon those who had reported to work were sent home by management and the factory was effectively closed for the day. Unable to contain the now violent actions of the rebellious workers, the provincial governor and an entire imperial regiment were called in to restore order. They arrived by 6 pm and were able to put down all of the workers activities. This was the first major industrial strike in Estonia.

Strike aftermath

The following morning there was a government inquiry into what had occurred over the previous two days. Soldiers continued to arrest workers who had been instigators through Friday, September 15th. Upon withdrawal of the military troops at the end of the week, the governor gave orders to reorient the local police and security organizations to better respond to issues at the factory, usurping the factory police chief and essentially dissolving its force. The district mangericht held a special session from September 18th to the 28th in order to review the criminal actions of the strike, 29 workers were indicted. Disputes between workers and management persisted throughout September and October so a state sponsored commission was enacted on October 17th. They reviewed the current situation at the factory and submitted a report on November 15th. The final mandates were that Kreenholm was subject to the laws of the land (nullifying a previous statute incorporated at the factory), a permanent police force appointed by the governor would be assigned to the factory, and the old system for worker fines would be replaced by a newer one more fair to workers. Only some of these measures were actually implemented at the factory as government oversight faded.

Ten years later, in 1882, a second workers strike happened at the factory. A collective of spinners walked out to confront management about grievances related to compensation and factory life once again; a lockout ensued with the strike and three battalions were called to Kreenholm based off the governments anticipations of disorders happening again. Military occupation lasted for a week as the strike continued, although in small groups workers began to return to the factory during this time. Some arrests were made of workers who had take violent action, but the factory was back to normal operation the following week.

20th century

Pre-annexation by the USSR

Knoop's sons Theodor and Andreas took over the factory as directors when Johann Prowe passed away in 1901. Kreenholm dominated the local economy in Narva during this time. In 1903 the company produced satin, lustrine, muslin, and batiste. The wages paid in 1910 amounted to $1,370,000. In that year, 74,660 bales of cotton were used, from which 34,861,796 pounds of yarn and 159,994 pieces of cloth (average 45 yards each) were used. Before World War I, this mill employed 10,400 people and manufactured 17,500 thousand tonnes of yarn and 75 million meters of fabric annually, which amounted to roughly 10% of the cotton cloth production in the empire. The valuation of the company during this time was now around 12 million silver roubles and its assets totaled 25 billion roubles. It was one of the largest textile manufacturers in the world.

Nearing the end of the First World War in 1918 the German army occupied Narva. The factory produced bandages and fabrics for the German war effort while it was occupied. During their withdrawal in the same year, the German soldiers took Kreenholm's cotton supply with them, leaving the company without any raw materials to manufacture with after the war ended. The companies post-war situation deteriorated further due to Estonia gaining its independence from Soviet Russia, which led to the loss of their access to Russian markets. In 1921 there were only 1,453 employees. The Estonian cotton industry experienced a crisis from this which resulted in the practical closure of the mill, which at the time was the largest mill in the former Russian Empire. The closure occurred since there was no market for this cloth due to postwar conditions in Soviet Russia. Although the mill was forced to reduce its workforce and decrease the overall production, the company was able to enter into new markets outside of the Soviet Union and emerged into a new state of prosperity for the years between its independence and annexation by the Soviet Union. In 1939 the factory had 2,736 employees. Amidst World War II in 1940, the Soviet military entered Estonia and nationalized their economy.

Post-annexation and Soviet ownership

The soviet decree to nationalize Kreenholm was passed on July 29th, 1940, Konstantin Grigoryevich Kosko was the first company director under the new regime. The factory lost access to European markets at this time, but the Soviet Union began to increase factory production to full-fill its own fabric needs. The German army captured Narva on August 18th, 1941, and again used it while it was occupied to supply the German war effort. When the Russians took back Narva on July 26th, 1944, the city was destroyed and the mill was inoperable, facing damages worth up to 250 million roubles at the time. The State decided to restore the factory in order to serve the Soviet Union.

Kreenholm was turned into a large industrial enterprise driven by policy rather than profits. From 1945 to 1955 the factory went from 208 employees, 58,368 spindles, and 42 looms to 9,360 employees, 222,516 spindles, and 4,091 looms. In 1960 a weaver at the factory named Taisia Marchenko received the Hero of Socialist Labor title. She was elected as a deputy to the 5th and 6th Supreme Soviets of the USSR. By the 1960s the company had returned to the height of its production and became one of the largest textile manufacturers in the Soviet Union. Kreenholm expanded its facilities and product offerings, notably adding art shops for design, giving the enterprise full production cycle capabilities. Employment reached around 12,500 people during this time.

In the early 1970s, the company reportedly owned of land and employed 12,000 people. From 1981 to 1985 Krenholm went under a restructuring that increased outputs and improved working conditions. In 1985, Krenholm was one of three enterprises selected in Estonia to experiment with exporting products outside of the USSR and entering foreign markets. This increased Kreenholms investments and product offerings, leading to a high of 4 million dollars in exports in both 1989 and 1990. After 1986, the company did not have to rely on approvals from the textile ministry in Moscow, as it had gained the authorization to independently export its goods.

Estonia gained its independence in 1991 which caused Kreenholm to go through a difficult transition while entering the global market economy. The national government founded the Kreenholm Manufacturing State Enterprise to help renew production. The privatization process in Estonia started in 1994, and on January 1, 1995 the Swedish company Borås Wäfveri AB acquired the company. It was renamed Krenholm Group and the realignment included several production units, including: Krenholm Finishing, Krenholm Sewing, Krenholm Spinning, Krenholm Terry Clothes, Krenholm Weaving, and Krenholm Service. It also owned major sales subsidiaries Krenholm Textile, Krenholm Scandinavia AB, and Krenholm Germany GmbH. Narva became the main production site for the group, and as of 1999 Borås Wäfveri AB owned all shares of the group.

21st century

In 2000 Kreenholm sales peaked in the market economy era at 1.24 million kroons. The company exported 86% of its production in 2001 with the majority of it going to EU and US markets. In 2002 the company employed 4,900 people. Throughout the early 2000s the company lost money and went under restructuring; many employees lost their jobs. In 2003, the company was forced to fire 170 workers after the closure of its spinning facility. In early 2004, the company had 4,600 workers, of which a further 400 were layed off in April 2004. During this time, the World Bank recommended that the company would need to cut down its labor force to 3,800 to avoid financial crisis. Amidst the layoffs, Narva trade unions held a silent protest outside of the Kreenholm headquarters. Despite the troubles, the company was able to stay afloat due to financing received from Estonian banks and the International Finance Corporation. In 2007 the Narva Gate private limited company purchased the land Kreenholm was on.

There was speculation in 2008 and 2009 that the company would go bankrupt, and it eventually did in November 2010. It was purchased by the Swedish company Prod i Ronneby AB whose affiliate company in Narva, Eurotekstiil, would continue some of the operations; there were about 500 people employed when bankruptcy was declared, along with 9.5 million euros worth of debt still belonging to the manufacturer. By 2012, the company chairman stated that it would be "absolutely impossible" to restore the previous scale of operations.There are currently plans to build a manufacture cultural quarter in the Krenholm site.

See also

* Textile manufacture during the Industrial Revolution

Further reading

* Zelnik, R. E. (1995). ''Law and disorder on the Narova River: The kreenholm strike of 1872''. University of California Press.
* (1933). ''75, 1857-1932 Gesellschaft der Krähnholm Manufaktur für Baumwollfabrikate''. Tallinn: Verlag der Krähnholm Manufaktur. (German language)

References

* ''This article includes text incorporated from United States Congress' "Congressional edition." (1912), a publication now in the public domain.''

{{Coord, 59, 21, 26, N, 28, 11, 27, E, type:landmark, display=title

Cotton mills
Textile companies of Estonia
Narva
Manufacturing companies established in 1857
1850s establishments in Estonia
1857 establishments in the Russian Empire
Manufacturing companies of the Soviet Union
Companies nationalised by the Soviet Union