The Salem Flouring Mills Company was built in 1865 on the north bank of the millrace where it empties into the Willamette River just south of Trade Street. The mill was financed by owners of the Willamette Woolen Mill, which had been built a decade earlier in North Salem. The mill was sold in 1870 to the Kinney Brothers of San Francisco and, at the time, was described as the largest mill of its kind in Oregon and Salem's leading industry; it could turn out 400 barrels of flour a day.

The Capitol Flouring Mills were built in 1877 further north where North Mill Creek empties into the Willamette River; the Willamette Valley Milling Company was built near them at the foot of Division Street in 1882. The latter burned October 7, 1904, in what was alleged to be an incendiary fire. At the time, a millrace ran southward along High Street to Division, and along it to the river. The Capital City Mills, with Bryant and Pennell as proprietors, was supplying flour and mill feed from the SE corner of Church and Trade in 1902.