Claus Spreckels was known as the “sugar king” due to his control over most of the sugar production in the western United States. Encouraged by passage of higher import tariffs on European sugar by Congress in 1897, the king quickly expanded his empire. That year Spreckels bought up thousands of acres in the Salinas Valley on behalf of his Western Beet Sugar Company. He paid for building the largest beet sugar refinery in the world, Factory Number 1, which opened in 1899 near Salinas, in the company town of Spreckels. Factory Number 1 soon processed one-quarter of all beets in California.

To feed the factory, growers in the Pajaro and Salinas valleys cultivated tens of thousands of acres of sugar beets. Some owned their land. But Spreckels also leased his land in ten- and twenty-acre parcels to tenant farmers, who, guaranteed an annual buyer for their crop, obligingly planted beets.