There are two architectural gems in the Northern Hemisphere that have helped people see clearly and kept markets honest for most of the past century, and now they shed light on how people can adjust to change.
One of these gems is in downtown Minneapolis, although it is better known to rural Minnesota residents than to people who drive by it nearly every day. It is the Fourth Floor, or Trading Floor, of the Minneapolis Grain Exchange.
The other can be found in Antwerp, Belgium, with variations in four major diamond exchanges. But the key architectural wonder is the trading floor of the Diamantclub van Antwerpen, the oldest of the four exchanges, or bourses, in Antwerp’s famed Diamond Center.
What they have in common are large, multi-story windows on the north side of the floor. To this day, the unbent northern line helps diamond traders in Antwerp examine the precious stones to see if there are any imperfections in the rocks. Reflected light coming through glass windows that face south, east or west can distort the careful examinations conducted by the diamond experts.
Giving a visiting journalist a tour of the Antwerp exchanges two decades ago, Diamond High Council spokeswoman Marleen Beerens proudly explained the uniqueness of those windows. “There is only one other place in the world that has a trading floor like this,” she said. “It’s where they trade barley in Minneapolis.”
Technology changes Grain Exchange trading floor
Alas. It no longer happens on the trading floor of the Minneapolis Grain Exchange, said exchange marketing director Nancy Krull. Technology can now link loads of barley at country elevators or from boxcars in rail yards to the malting properties sought by different beer brewers.
But for most of the past century, grain samples were brought to the cash grain trading area of the grain exchange, where traders, often called “the barley boys” by others in the grain business, would chew on kernels for taste and hold the sample to the north windows to check pigmentation.
The color of the barley kernels usually signaled malting properties that were important to brewers wanting to serve up consistent products to their loyal customers.
“Technology overran the barley trading,” said Krull. “You could say the north windows now provide great natural lighting for everyone else working here.”
Indeed it does. And it helps make the Minneapolis Grain Exchange’s trading floor one of the most exquisite architectural locations in Minneapolis even if it does remain a rural Minnesota secret to most residents of the former Mill City.
The importance of these charming trading places is that both Antwerp and Minneapolis markets are going through great change and less dependent on old technologies, such as north-facing windows.
Exchange retools for changing times
Minneapolis has moved on from being the marketing hub for cash grains in the Upper Midwest and Northwest. It is surviving by becoming a more important futures and index contract trading center for Northern Tier and Prairie Province farmers and their grain trading customers who want to better manage supplies and the supply chain of raw materials.
Coming through the 1980s, there were widespread fears that the Minneapolis exchange would not survive and that all grain commodity futures and options trading would be consolidated in Chicago.
The exchange changed, and celebrated its 125th anniversary of trading last year. Future and index contracts traded broke all records in 2007. The popularity of the marketplace was noted late in December when a seat on the exchange traded for $275,000.
Antwerp, meanwhile, is going through similar change right now. Technology allows traders to examine diamonds more closely in the field. Diamond exchanges in various Asian countries, Israel and Dubai are taking more of the international trading action. And lower-cost labor is diverting more diamond-polishing business to India and South America.
But just as the market practice of “open outcry,” or the buying and selling in public, has helped exchanges regulate and maintain integrity in markets going back to swapping horses in town squares centuries ago, the need for integrity may well prove the diamond in the rough for Antwerp.
The diamond industry in Antwerp is especially sensitive to the trading of “conflict diamonds” — the name given to black-market precious stones that support wars and terrorism and abuse workers.
Antwerp and its 1,500 diamond traders and firms give the international diamond trade a modicum of confidence that the diamonds are legitimate.
It should be noted that Belgians know a thing or two about barley as well. The Stella Artois brewery at Leuven dates back to the year 1366.
More information on the Minneapolis Grain Exchange and its role in developing the grain trade and agricultural economy of the Upper Midwest can be found in “The Grain Merchants: An Illustrated History of the Minneapolis Grain Exchange,” written by Dave Kenney and published last year by Afton Press. The $40 book can be purchased at the grain exchange, at area Barnes & Nobles books or by contacting Afton Press.
Lee Egerstrom is a fellow for Minnesota 2020, a new think tank based in St. Paul.
