New Ventures

In the first century of Russian-America, the economy was based almost entirely on the fur trade. Initially, the highly profitable sea otter and fur seal trade, and then, as these declined, land furs were acquired from the Interior. However, by the 1840s, fears of bankruptcy led the company to look for new economic ventures to compensate for decreasing fur trade profits. 

American whaling ships from New England entered the Gulf of Alaska in 1835 and the Bering Sea in 1848. In response, the Russian-American Company formed the Russian-Finnish Whaling Company in 1849. The Russian-American Company owned half of the whaling company's shares, and Finnish merchants owned the other half.

The company built three ships in the 1850s, which were sent on whaling voyages in Alaska's waters. The whaling voyages of these ships were barely profitable. All three were sold by the end of 1863, and the Russian-Finnish Whaling Company closed that year. 

Shipbuilding and repair were important industries in the colony. The Phoenix, built in 1793, was the first ship built in the Pacific Northwest. Later, Sitka had the first permanent shipyard on the Pacific coast of North America. At least four steamships and many sailing vessels were built there. Many foreign trading vessels would come in for repairs. 

However, despite the attempts at shipbuilding, the Russians in Alaska came to buy most of the ships they needed from the United States. Ships bought there lasted five times as long as the ones built in Alaska. They lasted longer because they were built with oak and pine instead of the cedar and fir available in Alaska.

Brick-making was another economic activity of the Russians in Alaska. By 1865, they were making 30,000 bricks each year in Kodiak alone. Kenai, New Alexandrovsk, and Wrangell also produced some bricks. Many of the bricks made were used at Sitka, where 12 to 15 thousand bricks were needed each year.

The Russians used the bricks to build stoves and chimneys. More bricks might have been made if better clay and more lime had been available. As it was, the lime the Russians used had to be burned out of seashells, and the clay was not good for brick-making, so brick-making never became a successful venture for the Russians. In fact, the Russians in Alaska could buy better and cheaper bricks from Victoria, British Columbia, than they could make.

The California Gold Rush in 1849 created new opportunities for Russian-Alaska. As thousands of people flocked to San Francisco, they needed many of Alaska's commodities, such as lumber, fish, and coal. For the first time, the colony had a market for something besides furs. 

The most successful new trade venture with California was ice. Each winter, company workers cut ice from ponds on Kodiak and Sitka, which was then shipped to San Francisco. In some years, over 10,000 tons of ice were sent south. The ice trade lasted several years, but San Francisco's demand for ice and other products eventually declined.

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