Mrs. Hauer's Northwest Company Page

Fur Trading

Bringing all of the northern regions under British rule did not stop the fur trade competition between Montréal and Hudson Bay. The French merchants of Montréal were joined by and gradually replaced by Scots. Gradually the Montréalers formed a cartel, the North West Company (NWC). Competition from the Nor’Westers, as the NWC people were called, forced the HBC to move inland from its posts on the bayshore, and the companies fought a fierce, costly battle from 1775 to 1821. The rivalry accelerated exploration of the west as fur traders sought new routes and suppliers. Nor’Wester Sir Alexander Mackenzie followed the Mackenzie River to the Arctic Ocean in 1789, and in 1793 he reached the Pacific. Nor’Wester Simon Fraser reached the mouth of the Fraser River, near modern Vancouver, British Columbia, in 1808. David Thompson, who followed the Columbia River to its mouth in 1811, mapped much of western Canada for the NWC.

I. INTRODUCTION

North West Company, fur-trading company in northern North America from the 1780s until 1821 when it merged with its main rival, the Hudson’s Bay Company (HBC). Scottish merchants based in Montréal, Québec, founded the company in order to expand their fur trading into the western regions of present-day Canada.

II. FOUNDING OF THE COMPANY

After the British conquest of the colony of New France in 1763, growing numbers of Highland Scots made Montréal their home. The city was a major fur-trade center because of its location on the St. Lawrence River and its access to water routes leading deep into the continent (see Fur Trade in North America). After the American Revolution (1775-1783) the Scottish population in Montréal continued to increase because many Scots who were loyal to Britain fled from the newly established United States to the northern British colonies.

The new migrants saw the fur trade, which had been dominated by the French, as an excellent opportunity for them to invest capital and, they hoped, to make fortunes. The Scots built on French expertise and hired voyageurs (French inland traders) who knew the north country and its indigenous peoples. Along with some merchants of English and French origin, the Scots extended their trading activities deep into the territory known as Rupert’s Land, which reached west to the Rocky Mountains. The British had granted the charter of Rupert’s Land to the HBC in 1670. Although the charter gave the HBC a monopoly over trade in the region, the monopoly was difficult to enforce because of the territory’s large area.

By the 1780s, the Montréal-based pedlars, as the Hudson’s Bay men called them, increasingly challenged the HBC monopoly over the regional fur trade. However, these entrepreneurs found they could not succeed without pooling resources and coordinating trade and transport. In 1779 a group of merchants led by Simon McTavish, Isaac Todd, and James McGill joined together informally as the North West Company. Other merchants joined in 1780, and in 1783 and 1784 the company formalized its structure and name. In 1787 the North West Company incorporated other former rival merchants to become the dominant force in the Canadian fur trade.

III. THE NOR’WESTERS

The Nor’Westers, as the traders of the North West Company were known, succeeded because they explored aggressively in the regions of Rupert’s Land reaching to Lake Athabasca and the Mackenzie River—regions that were rich sources of furs. Connecticut-born trader Peter Pond first explored the Athabasca country in 1778 and 1779. In the 1780s, as a partner in the North West Company, he made the first map of the Mackenzie River area. Soon after, Pond left the region after being accused of complicity in the deaths of two rival traders.

The Mackenzie River took its name from another member of the company, Sir Alexander Mackenzie, who followed the river to its mouth at the Arctic Ocean in 1789. In 1793 Mackenzie became the first European north of Mexico to reach the Pacific Ocean by an overland route.

Pond, Mackenzie, and several others became known as wintering partners (shareholders in the company who lived in fur-trade country) and had firsthand knowledge of the region’s life and indigenous inhabitants. On periodic trips back to Montréal or to their major rendezvous point at Grand Portage on western Lake Superior, they met with the company’s eastern partners to share knowledge and plan initiatives.

This decentralized management structure made the leadership of the North West Company better informed than that of the HBC, whose London-based directors did not travel to Rupert’s Land until the early 1800s. But in the 1790s friction developed between the North West Company’s Montréal partners and its wintering partners, who complained of their lower standing in the company and of the unfair distribution of profits. In 1798 some disgruntled members in the company organized the New North West Company, commonly known as the XY Company after the marks on its fur bales. In 1800 Mackenzie joined them. The two companies competed with each other, and this competition led to sporadic violence and increased the costs of trade as each firm built more posts and hired more men. In 1804 the death of Simon McTavish, who had been a focus of the XY partners’ resentment, paved the way for the XY partners to reconcile with their former colleagues.

Meanwhile, in 1803 the North West Company moved its Lake Superior depot from Grand Portage, which had become part of American territory under Jay’s Treaty of 1794, to Fort William (now Thunder Bay, Ontario), where the company built its new major depot. Beginning in the late 1790s, the North West Company had more inland posts and more employees than their rivals in the HBC. The presence of the North West Company forced the Hudson’s Bay Company to expand inland and to offer competitive goods and prices.

IV. FROM COMPETITION TO MERGER

Competition between the companies heated up in 1812, when Thomas Douglas, 5th earl of Selkirk, a stockholder in the HBC, established the colony of Red River in present-day Manitoba (see Red River Settlement). The colony was centered on the Red and Assiniboine rivers, a prime buffalo-hunting area where indigenous peoples and Métis, people of mixed aboriginal and European ancestry, made pemmican. Made from dried and pounded buffalo meat and fat, pemmican was an essential provision for the Nor’Westers on their long trade trips.

Since Selkirk was a stockholder in the HBC, the North West Company saw him as a threat to its own operation. Selkirk’s plans to introduce settlers and agriculture into the region intensified conflicts between the two companies, and the Red River settlers were subjected to threats and attacks from the Nor’Westers. The Nor’Westers feared the settlement would cut off their supplies of pemmican and their access to inland trade routes. The worst incident occurred at Seven Oaks on June 19, 1816, when a largely Métis force led by Cuthbert Grant, a Métis clerk in the North West Company, killed Red River governor Robert Semple and 20 other people. This increasingly destructive competition led company leaders, prodded by the British government, to negotiate a merger between the two companies in 1821.

Although former Nor’Westers dominated the new company in numbers and influence, the company took the name of the HBC, and the North West Company name disappeared until 1987. In that year, the Hudson’s Bay Company, which had built a chain of department stores in Canada in the 20th century, decided to sell off its Northern Stores Department, comprising 178 stores in communities across northern Canada. The new company formed to operate these stores revived the historic name of the HBC’s old Montréal rival. The North West Company, based in Winnipeg, Manitoba, is only tangentially connected with its namesake. However, it gives new visibility to a name that powerfully shaped the course of fur-trade history from 1783 to 1821.

Contributed By:
Jennifer S. H. Brown

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