Iron processing
Arppe was annoyed because of closing down the new Kuurna sawmill.[1] Another cause of disappointment was sawmill act, promoted by Haartman, that came into force in 1851 setting limits to potential of the industry. When Sofia and her children wanted to sell the Puhos sawmill in 1856, Arppe was not interested in it any more; the plant was sold to Antti Mustonen and Simo Parviainen.[2]
Arppe had bought a sawmill in Värtsilä in 1836 with rights of processing 10,000 logs annually. The plant had been founded two years earlier, on 12 April 1834. After introduction of the sawmill act, the Finnish Senate wanted to encourage iron processing. Arppe was awarded a permission to build two furnaces in Värtsilä for limonite processing, four power hammers and a workshop. Arppe got a loan free of interest from the state and tax exemption for 15 years.[4] Arppe bought rights of using hydro power from Jukajoki sawmill. The raw material, limonite, was collected in Ilomantsi, Kiihtelysvaara and Tohmajärvi.[1]
He opened another ironworks in Ilajankoski, but the production volume remained small due to unfavourable connections.[1]
Another, more prominent plant was built by Möhkönkoski rapids; it was operated by Rauch brothers since 1848. The ironworks was close to Arppe's lands[1] and the owners had made mining claims in lakes which were inside Arppe's forests.[4] Arppe raised court cases claiming for example that the iron mill is polluting meadows from which the local people get food for their animals. After the Rauch brothers got enough of Arppe's disturbance and left, Arppe redeemed the ironworks to himself in 1851.[1] This happened before the Värtsilä plant was started.[4]
In Arppe's ownership the Möhkö became the largest limonite processor of Finland.[1] The main problem in both ironmills was the high phosphorus content in the mineral; this made the iron hard but fragile. In 1859, Arppe got licence to build a steam-powered puddling and rolling plant in Värtsilä; it was used for the production of both Värtsilä and Möhkö.[4]
The ready ingots were transported to Värtsilä or through Pälkjärvi to shore of lake Ladoga.[1] After the Saimaa Channel was taken into use in 1856, the products could be transported by water. The main market areas were Saint Petersburg and south side of Gulf of Finland. Crimean War increased the demand temporarily, but after that prices dropped. Although the Finnish iron ingots and bars were duty-free in the Russian market, the highly developed international iron producers could sell their products for a competitive price despite tariffs. Arppe's other supporting leg was his timber industry which enabled investments on ironmills.[4]
Ingots were further processed into bars in Värtsilä. Arppe's company employed thousands of people; Möhkö works alone gave work to 2,000 men for limonite digging, coal burning, operating of barges and driving horses. Arppe's plants provided significant income to the local people. The plants attracted many workers from distant locations and the local food production could not cover the need. Arppe printed his own notes, called "dog tongues", which could be used as payment in company shop.[1]
