Before their fates became entwined, Schell’s and Grain Belt existed in parallel worlds that seemed unlikely to intersect. Schell’s was eternally a privately held, family-owned company supporting itself mainly on the local market. Grain Belt was the product of mergers, investors, and aggressive pursuit of regional market share. Not surprisingly, both stories begin with a German immigrant. After all, the three necessities of a newly arrived German family are a brick house, a Lutheran church, and a good supply of lager—and not necessarily in that order.
For the purposes of this story, John Orth is an honorary German immigrant. Though technically French, he arrived in St. Anthony Village in 1849 from Alsace, an historically German area of the Rhine border region, habitually annexed by the French in the 17th and 18th centuries, taken again in 1918, and once more after Nazi occupation. In 1850, Orth founded the first of three breweries that would eventually merge to form the powerhouse Minneapolis Brewing Company. Golden Grain Belt, the beer for which the company would eventually rename itself, was introduced in 1893. Subsequent chapters of the Grain Belt story can be lifted as much from Oliver Twist as Lord of the Flies; entrepreneurial zealotry, predatory price-fixing, and the tragic decisions handed down by the magistrates of Prohibition. In his seminal book Legend of the Brewery, historian Jeff Lonto recorded this quaint reaction to the devastation that closed more than 1,000 breweries following the passage of the 18th Amendment: “Minneapolis Brewing Company officials had hoped that Prohibition wouldn’t last, but by the end of the 1920s, with repeal nowhere in sight, company officers conceded that the company couldn’t continue. In October 1929, a liquidation dividend of $5 per share was paid to stockholders. Officer’s salaries were reduced and company president Fredrich D. Norenberg’s salary was eliminated.”
Only a company that went on to produce “The Friendly Beer” could provide this startling contrast to the venal conduct of 21st century capital. But post-war competition led the company into unfriendly dealings with competitors. Between 1959 and 1970, Hauenstein Company of New Ulm, Kiewel Brewing Company of Little Falls, and Storz Brewing Company of Omaha were purchased and shut down by Minneapolis Brewing. Minneapolis Brewing products sold under these cannibalized labels never enjoyed enduring success, but such takeovers left 75 percent of the Minnesota beer market in the hands of four producers by the 60s. Minneapolis Brewing’s share reached a hefty 24 percent before it became a target itself of hostile takeover by none other than Irwin Jacobs, Minnesota’s most infamous deal-closer.
Jacobs liquidated the company without mercy within eight months of his 1975 takeover, and the orphaned label was purchased by G. Heileman, which had previously purchased the Schmidt brewery in St. Paul. This proved to be only temporary foster care for Grain Belt, as Heileman closed the St. Paul site in 1990 and sold the label to the doomed investors of the newly created Minnesota Brewing Company. The retro-hip company that created Pig’s Eye kept Grain Belt on life support until August of last year. On August 6, 2002, privately held August Schell Brewing Company signed a purchase agreement for the Grain Belt label and recipe. Present at the signing was Kay Mathes, widow of Grain Belt brewmaster and Army censor Frank Mathes, who during World War II provided recipes to European brewers for the supply of American troops. Mathes tucked the Grain Belt recipe into a keg that was then sealed and brought to the Schell’s museum in New Ulm.
While the legacy of John Orth ended with Irwin Jacobs, August Schell’s direct descendants are still rolling out the barrels after 144 years. In 1860, the Cotton River provided slabs of ice and riverside caves for the temperature regulation now assigned to the proud uni-tanks. And while rapidly multiplying breweries battled for market share in the urban (if not urbane) taverns of Minneapolis, New Ulm fought for its very existence during the Dakota Conflict of 1862, just two years after Schell’s was founded.
During the 1850s, more than 150,000 white settlers had moved into lands inhabited by the Santee Sioux and other tribes of the Sioux Nation. Tribes were moved, removed, and moved again in a series of treaties with such poor compensation that Mdewakanton (yes, the same Mdewakanton who now run Mystic Lake Casino) chief Little Crow would become embarrassed at his own naivete. The loss of land disrupted the hunting practices of the
Sioux, and in 1862, they also faced crop failure. In July, the Santee gathered at Yellow Medicine River to receive federal annuities due in exchange for their land. But the civil war had left Uncle Sam short, and no payment arrived. Lower Agency chief Thomas Galbraith made the infamous decision to keep food stores closed to hundreds of hungry Mdewakanton on the day that trader Andrew Myrick spoke the words that launched the Sioux uprising: “If they are hungry, let them eat grass or their own dung.”