John Wilkinson’s Interests in Copper (Continued)

1775  Wilkinson’s Steam Engines. 11

1775  Wilkinson’s Steam Engines

One of the first Boulton and Watt steam engines made was the one installed by John Wilkinson at the New Willey Ironworks, Broseley, Shropshire.  Every effort was made to ensure success in order to impress neighbouring ironmasters.  It was custom to outsource the castings for such large machines.  Apparently none of the parts was made at Soho; everything was done at Wilkinson’s works[1].  Watt supervised the erection in early 1776 and was well pleased with the excellence of the workmanship.  This implies that Wilkinson supplied not only the iron castings but also the copper and brass components including boiler, water and steam fittings.  Therefore there must have been a brassfoundry and a coppersmith’s workshop at Willey.  This would not be surprising since Wilkinson already had brassfounding experience at Bersham and Bradley and the equipment needed would be relatively simple.  A year later, Wilkinson also made the components for the ‘inverted’ engine used at New Willey to drive the cannon boring lathe.

Both Boulton and Watt favoured copper as the material for the boilers[2].  It was more easily worked and the craft of the coppersmith had achieved a high degree of perfection suiting the demands of brewers and distillers.  Copper lasted twice as long as iron in service and then had a good scrap value.  When iron was tried as boiler plate, it was found that British material was not good enough.  Russian iron was specified instead.  Wilkinson may have employed coppersmiths to do his local work although, by 1777, the copper boiler components for the Cornish engines were being made by John Freeman and Son of Bristol.  With his experience and his well-known reputation for high quality finish-machined castings, he was the preferred supplier of main components for other engines.

Early in their development of the steam engine business in Cornwall, Boulton and Watt needed more capital than they had available.  Wilkinson offered to subscribe but was not accepted.  This will have proved a benefit later when relations between the engine makers and the Cornish mine owners became very strained.  He still had their good will and confidence.

Mine owners who owed Wilkinson for the cost of casting might have a choice of payment methods.  Some did manage cash, others paid with tons of copper and yet others with shares in their mines.  Alternatively, he took payment in block tin.[3]  Since the mines’ prosperity would, and did, increase when the engines came on stream, he could see a good capital growth potential there. He had shares in Consolidated Mines, United Mines, Poldice, North Downs, Scorrier, Wheal Bussy, Tresaven and Chasewater.  These were generally accepted in lieu of payment for iron castings for machinery. 

There was an agreement that required engine owners to pay a royalty to Boulton and Watt, being one third of their coal savings each year.  The advantage to the owners was that their engines were paid for out of revenue rather than scarce capital.  When the copper prices fell, their profitability suffered and they tried to renegotiate the terms.  Wilkinson was then asked to act as an honest broker. 

1785 The Cornish Metal Co

Cornish miners and Anglesey mine owners needed to set up a joint marketing company for copper together with interested refiners, users and financiers.  This would control the market sensibly and help stop the refiners from forcing prices down by what was known as the ‘ticketing’ system by which refiners made low offers on batches of ore at auction.  With available finance, technical and commercial expertise and negotiating skills,  John Wilkinson was closely involved and a significant force in the successful outcome of the discussions.  It is well described by the late Professor Jack Harris of Liverpool.[4]  He had made an extensive study of papers including the Boulton and Watt Collection in the Birmingham Reference Library and the records of Yorkshire Imperial Metals who had taken over many of the South Wales copper refineries and fabricators involved. 

 At this time, Anglesey copper could be mined cheaply from high grade ore and the mine owners could afford to sell at a lower price than Cornish miners.  Also, while the Anglesey mines had their own small refineries, the Cornish did not and could not afford to set one up in Cornwall or to bring the Welsh coal from Swansea for the purpose.  Besides the miners, many entrepreneurs from the Bristol, Liverpool, London and Birmingham areas were involved because of the need to call for cash to finance stocks of copper while being refined and sold.[5]  Not until metal is made into a product and sold is money realised. Boulton had a strong interest in obtaining copper for his minting operations independently of Thomas Williams’ Anglesey supplies.[6]  John Wilkinson was very interested to see the scheme succeed for the benefit of all concerned, including himself, and to stabilise the price of copper at about £80 per ton for the benefit of the Birmingham metal trade.  Together with Williams, he was very forceful during the talks and obtained the agreement of the many free-thinking Cornish miners.

 In trying to get agreement he was frustrated by the attitudes of some of the prospective participants.  He said to Boulton:

 “For God’s sake, endeavour to infuse a patriotic spirit in those that are to be the acting members in our metal company that the intention of so good an institution for the real interest of the copper trade be not defeated.  There has been such egregarious mismanagement in the conduct of smelting as well as ignorance of it in the mining part that I am inclined to make another effort to save the company.”[7]

 As a result of these effort, Boulton reported:-

“Mr Wilkinson hath acted with great spirit and firmness.  He and Mr Williams have drove the Cornubians, and Bristol men also, before them like sheep, and kept them in a constant fever until all the foundations of our future plans were lay’d.”[8]

 When it came to the initial subscription, Wilkinson led the way by putting down £25,000 immediately and setting an example that gave confidence to all the others.  It was a stock issue guaranteed to pay 8% and part of the capital subscribed was used in a sinking fund to ensure that the interest would be paid, irrespective of the success of the scheme.  Wilkinson offered to smelt one eighth of the copper as part of the bargain, at a charge of 45/- per ton.  This would presumably be carried out either in one of his own furnaces or one owned by Williams. 

 An agreement was later signed by the Cornish Metal Company with five smelting companies including John Freeman and Company of Cornwall, Bristol and South Wales.  Each agreement was aimed at covering all eventualities and had a large number of supplementary clauses to ensure that all were satisfied that they had a fair deal.  Cornwall was to provide 3/5^ths of the copper, Anglesey 2/5^ths at a price fixed by the Cartel.  At £80, the Cornish could make a living while the Anglesey mines made a useful profit, albeit on a smaller tonnage.  John Vivian was made General Manager of the Company and was responsible for sales negotiations.

 The controlled price obtained by the cartel gave the Cornish miners a better deal than they had previously enjoyed.  Sven eighths of their output had a guaranteed price.  Success was dependant on a steady copper price that was not to be undercut by the Anglesey mine owners.  A separate agreement was made with the Anglesey mine owners who did even better because their production costs were lower.  The main shareholders in Anglesey, besides Williams, were Lord Uxbridge (Marquis of Anglesey), Hughes and Dawes.  Wilkinson soon joined them as a shareholder in companies connected with the Anglesey industries.

 The Company agreed that warehouses should be established to sell the copper where needed in Birmingham, London, Bristol and Liverpool.  Wilkinson and Watt could especially assure users in Birmingham that they would have continuity of supplies at an economic price.

 In 1786 Boulton chaired a meeting of the Cornish Metal Company with Vivian, Williams, Wilkinson, Thomas Harrison (for Lord Uxbridge).  Wilkinson objected to Vivian’s secrecy with the minutes.  Copper prices were fixed at £86 for cake and £88 for shot, this being £4 above 1785 Birmingham average.  Anglesey sold well at that price, Cornwall did not.[9]

 Williams, Wilkinson, Boulton and Vivian met in London during 1788 to re-arrange the Cornish Metal Company stocks and back up Boulton at the Privy Council to secure a national coinage contract.[10]  The monopoly policy was then to keep the price of fabricated copper high while keeping ore prices low so as to maximise profits for the Metal Company members.

 The Company was less successful than expected for a variety of reasons but that is not to say that it was Wilkinson who lost out.  Separate selling arrangements applied at various times to Cornish and Anglesey copper.  Anglesey copper could be produced and sold more cheaply than Cornish at that time and independent sales undercut the Cornish miners, bringing the price down significantly.  The Company was not as successful as hoped in establishing market control.  Dissent was caused in Cornwall and some blame was attached to Vivian, though whether he deserved it is not clear.  However, Wilkinson had sold his iron castings successfully in both Cornwall and Anglesey, had taken shares in mines in Cornwall, mines and manufactures connected with Anglesey, and also warehouses dealing in copper.  He was brokering copper refining capacity and copper stocks.  In addition, he could draw his 8% interest on the Company capital. 

 By 1787, the Company was in crisis.  While the Company price was £80, Williams was selling his surplus at £76 in England or £74 to the East India Company.  There was a private discussion with Boulton and Vivian at ‘The Lawns’ in Broseley before they went to see Williams. 

Vivian and Boulton went to London during the same year to lobby Pitt about introducing copper for coinage and called for Wilkinson to join them.  This attempt to increase the market for copper was not immediately successful.

In October 1787 the copper price had dropped as low as £48/ton and the company was financially embarrassed.  Watt reminded everybody that the Agreement required that the 8% interest payable was based on a fixed price of £78/ton.  This represented a £9/ton cost to the miners that was insupportable at a selling price of £48/ton.  Wilkinson was able to advance £15,000 to the Company advantageously against the security of cash copper at £50/ton whereas the prevailing standard for Cornwall was then £67!  Cornish production rose from 1798 onwards, making up for the gradual decline in output of Anglesey as their ore became depleted.

In 1790, the price for Cornwall was set at £74/ton with a complex agreement originated by Wilkinson for Williams.  The result was that Thomas Williams gained a five year monopoly of selling Cornish Copper.  As part of the deal, Wilkinson had gained a seat on the board of each of many of the Anglesey subsidiaries.  In 1791, Williams raised price further to c£86/ton but then refused to sell in Birmingham due to shortage of copper to meet all markets.  In 1792 the Monopoly arrangement finally collapsed.

Summarising Hamilton’s[11] description of the events, there are several reasons for the short life of the Company. 

The stocks on hand in Cornwall at the inception were greater by far than expected, rapidly tying up the capital invested.

Only 7/8ths of Cornish copper was covered and rather less than that of that from Anglesey. 

 Higher prices stimulated production in both Cornwall and Anglesey. 

Other copper was sold at lower prices.

The sales effort on behalf of the Company did not match that of others selling copper. 

The agreement only involved five of the many South Wales smelters.

Some of the Company Directors had split loyalties.

When the company was wound up, the shareholders regained their money.[12]  The other arrangements that John Wilkinson had had bolted on to the Company structure had probably rewarded his foresight quite usefully.

Shares in Copper Mines

Wilkinson built up a portfolio of shares in Cornish copper mines such as Consolidated Mines, United Mines, Poldice, North Downs, Scorrier, Wheal Bussy, Tresaven and Chasewater.[13]  When these were bought and sold is not clear but the success of some of the mines is included by Symons in his review of Vivian’s evidence in 1799 to the Parliamentary Committee inquiring into the copper mines.[14]  It is noted that many of the adventurers who invested were also equipment suppliers and content to take their profits on what they supplied.  He also mentions the common saying of the time that ‘It is much easier to throw tin into a mine than get it out!’ 

However, in a survey of the profits and losses made by a sample of sixteen of the many Cornish mines in the period 1792 –1798, Symons covers four of the eight mines in which Wilkinson had shares at some time.  Consolidated Mines and United Mines both made a reasonable profit.  North Downs and Tresaven ended up slightly in the red.  This would be regarded as satisfactory.

Sometime around the period of 1790-1805, Wilkinson sold most of his copper shares[15], going liquid in order to invest in more land around his ‘retirement home’ in Castlehead and district.

1788 Birmingham Warehouse Company

In 1788, Wilkinson joined the venture to set up the Birmingham Warehouse Company with the laudable intention of providing the Birmingham industry with steady supplies copper at reasonable prices.  The others involved were Matthew Boulton, James Watt and John Hurd.  A subsidiary motive was to help Williams through a cash flow problem to the extent of £10,000.[16]  The arrangement with Williams was that they could take delivery at advantageous Liverpool or Swansea prices, unlike other warehouses who paid extra for transportation costs.  In the early stages, Williams advised them to buy all they could in advance of a price rise to £84/ton.  By October 1790, John Wilkinson and Matthew Boulton were opting out of the enterprise for various reasons to do with the supply of copper, its price variations and lack of return on their capital.  Copper reserves in Anglesey were getting low and therefore the cost of extraction became higher than that of Cornish ore so their advantage was becoming lost.  In the 1790s Wilkinson continued to invest elsewhere in copper as the prices rose.[17]

Copper in Cast Iron

There are many known benefits to be gained by adding copper to cast iron such as increased strength, toughness and corrosion resistance.[18]  In conventional grey irons, it improves graphitisation and refines the structure.  To be successful, the additions of other elements such as silicon and manganese are controlled.  When this technique was started is not known but there is an early illustration of the use of additions of Boulton’s 1797 ‘Cartwheel’ pennies to melts to achieve good results.  They were a known standard weight of pure copper, easily dissolved and obtained at an economic cost.