The History Behind the Valdez Grain Elevator

Grain silos in Valdez. Photo courtesy Andrew Carlson

August 28, 2025

Andrew Carlson - Guest Columnist

Driving south down the Richardson Highway one can observe a grain elevator standing on the left hand side of the road just outside the city of Valdez. One may have pondered while passing this grain elevator why Valdez ever built one in the first place? The answer to this question lies in an agricultural project funded by an oil boom.

The man responsible for the Valdez grain terminal’s construction (though not constructed where originally intended) was Governor Jay Hammond. Hammond wanted to create a renewable resource industry in Alaska by investing a portion of Alaska’s new oil wealth into the Delta Barley Project.

The Delta Barley Project looked good on paper. However, there were two major factors which led to the project’s failure. The first problem was that barley prices were reaching record highs when economists studied the feasibility of the Delta Barley Project in the early 1970’s. The second problem was a breakdown in the fulfillment of the links in the “chain” as referred to by Hammond regarding the infrastructure required for the Delta Barley Project to succeed.

Barley prices boomed during the economic feasibility study between 1971-1974, but then busted when the actual farming began between 1975-1993. The bust did not mean that all Delta farmers went bankrupt immediately. Inventive Delta farmers, such as Barney Hollembaek, switched from growing barley to growing grass seed and he was able to farm until declaring bankruptcy in 1988. Other Delta barley farmers, such as Jerry Brehmer, who stuck with strictly barley went bankrupt 10 years earlier in 1978.

Not only were barley prices not in the Delta Barley Project’s favor when Delta farmers began ploughing their fields in the late 1970s, but the infrastructure promised these farmers by the state did not come to fruition either. One major link in the “chain” Hammond had called for was, “…a grain terminal at the rail/shipping port of Seward.” Conversely, Valdez fought Seward for the right to construct the grain terminal and won. This made the state’s purchase of 20 rail cars for $940,000 superfluous. The state in turn had sold 18 of the rail cars for $598,000, a $342,000 net loss. Barley farmers were now faced with the dilemma of trucking their grain to Valdez (cost prohibitive), which contradicted the original plan of shipping grain by rail to Seward (cost effective).

By 1993 with the majority of the Delta Barley Project’s farmers having declared bankruptcy, Valdez held its “bondfire” to celebrate their final payment on their unused grain elevator and neighboring container dock. A burn barrel was brought to the door of the Valdez Council and as the Daily Sitka Sentinel reported, “…Mayor John Harris lit a match for the ceremonial torching of the retired municipal bonds.” The final payment of $27.9 million for the grain elevator and dock had been made. The Daily Sitka Sentinel also noted the irony that at the time of this final payment, “Valdez’s silos…have never held a single grain.”

Interesting Facts:

·  In 2021 it was proposed that the Valdez grain silos be used for storing dried seaweed for export.

·  Paradoxically after the majority of Delta Barley Project’s farmers had declared bankruptcy and Valdez had paid off their unused grain elevator in 1993 barley prices would boom once again from 1994-1996.

·  If a similar grain elevator were constructed today it would more than double 49 million.

Further Reading
“Valdez Fighting Seward for State Agriculture Exports,” Daily Sitka Sentinel 05/01/1981,1.
“Valdez has a ‘Bondfire’ After Grain Elevator Bill Paid Off,” Daily Sitka Sentinel 08/05/1993, 8.
Jay Hammond, Tales From a Bushrat Governor (Kenmore: Epicenter Press, 1994), 262-263.
Andrew Carlson, "Boom and Bust in the Tanana Valley Grain Industry: Barney Hollembaek and the Delta Barley Project, 1968-1988," Journal of the West 61, no.3 (Summer 2022):70-81