26 minute read

The David J. Joseph Company Business Information, Profile, and History

300 Pike Street
Cincinnati, Ohio 45202

Company Perspectives:

The David J. Joseph Company will focus on deepening customer relation ships. We will be the leading provider of value added services to the steel, metals and related industries. We will extend our global reac h in concert with SHV and affiliates. The Company will seek to manage its business portfolio for earnings growth and investment return to exceed shareholder expectations. The Company's continuing success wil l be built upon its century-long core values as well as the quality a nd responsiveness of its employees. We will develop our human resourc es in sufficient depth and strength to assure the full realization of our mission and objectives.

History of The David J. Joseph Company

The David J. Joseph Company (DJJ) is widely recognized as America's o ldest and largest scrap iron and steel company. With more than $5 billion in sales and $600 million in assets, DJJ is also one of the largest scrap metal companies in the world. The company provides procurement services for scrap consumers, ferrous and nonferrous scra p trading and processing, international scrap and substitutes marketi ng, ferro-alloy and nodular and foundry pig iron trading, mill servic es, rail services, industrial scrap services, and railcar lease, purc hase, sale, and finance. DJJ operates as a subsidiary of Netherlands- based SHV Holdings, N.V.

Early History

The company's history can be traced back to the mid-19th century, whe n German immigrant Joseph Joseph started a textiles business in Cinci nnati. Swept up in the industrial revolution, the founder launched a scrap iron business in 1885. The railroad and construction industries helped increase demand for steel--and in turn boosted the scrap busi ness--throughout the late 19th century.

Known in the late 1800s and early 1900s as the Joseph Joseph & Br others Company, the family business diversified vertically and horizo ntally. The Indiana Rolling Mill Co. subsidiary was eventually merged into Republic Iron & Steel, a leading steelmaker in the early 20 th century. The founder also created the Railway Supply Company and t he Ohio Falls Iron Company.

Although each of the founder's five sons earned positions in manageme nt, it was the youngest who rose to the top. David Joseph first start ed working at the scrap brokerage in 1897 at the age of 11. The futur e company namesake rejoined the firm in 1905 after earning degrees fr om the Franklin Institute and Harvard University. He advanced to lead ership of scrap operations by the time he was 30. Following the 1920 dissolution of Joseph Joseph & Brothers, the David J. Joseph Co. was formed to pursue the scrap iron business.

The development of the open-hearth furnace in the early 1900s both im proved the quality of steel and encouraged consumption of scrap metal . Although steel manufacturers used "home scrap" from their own opera tions, the burgeoning auto industry's voracious appetite drove the ex pansion of the purchased scrap business.

Nonetheless, the scrap business remained a risky proposition ruled by the cyclical dictates of supply and demand. Scrap dealers played the odds, stockpiling material when prices dropped and selling when dema nd drove prices up. Scrap collection grew so efficient that an analys t for American Metal Market characterized the market as "demand-drive n," asserting that "scrap is bought, not sold." A 1995 company public ation noted that DJJ dealers occasionally "resorted to barter, taking finished steel in the attempt to make a profit." Given the structure of the industry, DJJ evolved into a brokerage. It established contra cts with steelmakers that required the firm to find scrap supplies to meet steelmakers' needs.

Surviving the Great Depression/War Years

The speculative nature of the scrap iron business was exacerbated by the Great Depression, which in the United States shut down more than half of the capacity for steel production. According to a company his tory, David Joseph did not let the national financial crisis stand in the way of a good deal. The 1933 purchase of 16,000 Southern Railroa d railcars and engines is an oft-cited case in point. DJJ shipped a w hopping 625,000 tons of scrap to Great Britain four years later. Larg e, risky transactions such as this helped DJJ rebound in the mid-1930 s.

DJJ's close ties to the railroad business developed into an enduring, but lesser-known, segment of the family company. Railcars were an ab undant source of scrap steel. DJJ's railcar scrapping developed propr ietary burning equipment for wood-lined boxcars. The firm not only sc rapped railroad equipment, it also refurbished railcars. Some of thes e were drafted for use in a company-owned fleet that transported scra p across the country; others were sold or leased to railroads and bus inesses. This auxiliary operation eventually developed into DJJ's Rai lroad Equipment Division, which had facilities in Illinois, Nebraska, Colorado, Tennessee, Florida, Kentucky, Virginia, Georgia, Texas, an d Utah by the late 1980s. This division maintained a fleet of nearly 10,000 general-purpose railcars by the mid-1990s.

By the early 1940s DJJ was generally acknowledged to be America's lar gest scrap iron broker; it also ranked as a top scrap iron and steel exporter. David J. Joseph, Jr., joined the family firm in 1938 and as sumed the presidency in 1945. In contrast to his father, the Yale alu mnus was better known for his managerial techniques than his trading prowess. DJJ expanded with the steel industry throughout the postwar era.

A New Parent Company for DJJ in 1975

The Joseph family divested ownership of its namesake company to SHV H oldings, N.V. of The Netherlands in 1975. SHV was a worldwide global trading conglomerate with interests that included wholesaling and ene rgy. David J. Joseph, Jr., accepted the presidency of SHV's North Ame rican Holding Corporation and remained in that capacity for seven yea rs. He retired in 1982.

James R. Breth was elected to DJJ's presidency in 1980. He had starte d as a broker in one of the firm's southern offices, advancing to off ice manager in 1960. He became vice-president of trading in 1976. In 1986, the veteran trader was elected chairman.

Technological advances and structural changes in the steel industry b enefited DJJ in the 1980s and early 1990s. Just as open-hearth furnac es had changed the face of the steel industry at the dawn of the 20th century, the development of the electric-arc furnace in the 1960s sp urred another revolution. The electric-arc furnace used scrap iron an d steel--instead of the traditional mix of iron ore, limestone, and c oke--to make a limited range of steel products. Compared with convent ional integrated mills, the "minimills" that evolved around electric- arc furnace technology were faster, more efficient, more versatile, a nd more productive than their dominant counterparts. At the same time , steel mills striving for increased efficiency reduced their product ion of "home scrap," thereby raising their need for purchased scrap. Thus, even as U.S. steel production declined in the late 1970s and ea rly 1980s, demand for purchased scrap iron and steel increased.

The minimill segment of the steel industry fit well with DJJ's own de centralized strategy. Its regional markets and emphasis on autonomy e choed DJJ's corporate culture. DJJ had the foresight to forge close t ies with two of the most important minimills in the United States, Nu cor Corp. and Florida Steel Corp. Established in 1967, North Carolina -based Nucor had grown into the largest and most profitable producer in the minimill sector. DJJ enjoyed valuable exclusive brokerages wit h Nucor and Florida Steel.

DJJ's internal technological advances created efficiencies and improv ed profitability as well. Perhaps most noteworthy was the company's i nformation system that linked company traders, and technology facilit ated the coordination of orders and supplies.

Global Expansion in the 1980s and Early 1990s

The vast majority of DJJ's post-World War II business was conducted d omestically, but in recognition that the United States was the world' s largest exporter of scrap, the company reentered international mark ets in 1985 and created an international division two years later. Wi th the support of its globally influential parent, DJJ expanded its g eographic reach through exports to Canada, Mexico, and overseas marke ts. In 1993, DJJ expanded railcar leasing, repair, and remarketing in to Mexico through a joint venture with Servicios Financieros Quadrum S.A.

DJJ also expanded through acquisition in the late 1980s and early 199 0s. After a six-year hiatus, the company reentered the nonferrous seg ment of the scrap business with the purchase of United Iron & Met al Co., a Baltimore firm. The 1991 acquisition of Frank H. Nott Inc., a private, family-owned company founded in 1887, further expanded DJ J's nonferrous activities.

Two publicized attempts to expand DJJ's processing activities through acquisition were inexplicably aborted, however. In 1992, the company initiated the $18 million purchase of three southern scrap yards from Proler International Corporation. The deal was abandoned within months of its announcement with no public explanation. Less than a y ear later, the proposed acquisition of Ferrous Processing & Tradi ng Company, a major Detroit-area scrap yard, fell through. Later in 1 993, DJJ was able to acquire two ferrous scrap shredders from the ban krupt CF & I Steel Corporation.

Although DJJ's processing operations remained limited in the early 19 90s, the company was not sheltered from the environmental pitfalls of this aspect of the scrap business. Scrap processing entails handling and disposition of the hazardous byproducts of everything from autom obiles to medical equipment. As a result, it is regulated by state an d federal environmental and worker safety agencies. In 1993, DJJ's Ta mpa, Florida, scrap yard discovered two cancer therapy devices contai ning radioactive material. (Both components were found before any har m was done.) DJJ also has been involved in a Tampa-area Superfund cle anup ordered by the U.S. Environmental Protection Agency. These event s dramatically illustrated some of the risks associated with the scra p industry.

DJJ got a new leader in 1992, when Louis F. Terhar, Jr., advanced to president and chief executive officer. Terhar had been with DJJ a sca nt three years. James Breth stayed on as chairman.

Industry analysts were divided over the prospects for the domestic an d international scrap markets in the mid-1990s and beyond. Some predi cted that rising global minimill capacity and production would fuel s crap steel shortages. That was good news for scrap dealers, who antic ipated higher prices. Other analysts, however, forecast that rising s crap prices would simply revitalize the more traditional integrated p roduction methods. Given the support of its parent, its historical pe rformance, and its strong ties to the minimill sector, DJJ's position appeared impervious to market shifts.

DJJ in the Late 1990s and Beyond

DJJ made several key moves in the late 1990s and early years of the n ew millennium that solidified its position in the scrap metal industr y. During 1996 the company formed Western Metals Recycling LLC when i t merged its processing facilities in Plymouth, Utah, and Englewood, Colorado, with those of Atlas Steel Inc. Two years later, the company partnered with Newell Recycling Company to create Trademark Metals R ecycling LLC, a processing company based in Tampa, Florida. Later tha t year, DJJ added Klempner Brothers Inc. and the River City Baling an d River City Shredding yards in Louisville, Kentucky to its arsenal. River Metals Recycling LLC was formed as a result of the deal.

DJJ also worked to bolster its railcar leasing business during this t ime period. In November 1998, the company bought FerroQuadrum, S.A. d e C.V., a large railcar leasing and repair firm based in Mexico. DJJ believed the purchase would strengthen its transportation services di vision, which benefited from a North American rail system that stretc hed from Montreal, Canada, to Mexico City.

By now, sales had surpassed $2 billion. DJJ continued to forge pa rtnerships as it entered the year 2000. It joined with Ferrous Proces sing & Trading Co. of Detroit, Michigan, to create Gemini Recycli ng Group LLC The venture gave DJJ a strong foothold in Detroit, one o f the largest scrap producing areas in the country. Gemini was establ ished as a full-service company that processed, transported, and sold scrap metal for manufacturers who produced scrap metal as a byproduc t.

In September 2000, the company formed DJJ Metals Group, which was est ablished to oversee the marketing of metal sales including aluminum, copper, brass, nickel, and stainless.

DJJ's Trademark Metals Recycling group installed a new mega-shredder at its Tampa Port in Florida in 2002. The new shredder was much more efficient and had the capacity to produce up to 30,000 tons each mont h--double the capacity of the old shredder.

During 2002, River Metals Recycling installed the world's first onlin e bulk scrap analyzer at its Newport, Kentucky facility. In September 2004, the second Gamma-Tech Crossbelt Metal Analyzer went online in Louisville, Kentucky. DJJ had worked with Gamma-Tech since the late 1 990s to develop the new analyzer, which after several rounds of testi ng was able to accurately determine the chemical makeup of scrap grad es.

DJJ's actions during the last five years had left it on solid ground. It remained the largest scrap broker in the United States with 11 of fices, and by 2005 sales had moved past the $5 billion mark. DJJ planned to continue to strengthen its ferrous brokerage, ferro-alloy, metals, processing, and rail operations in the future. As the leader in its industry, The David J. Joseph Company appeared to be well pos itioned for success in the years to come.

Principal Divisions: Ferrous Brokerage; Ferro-Alloy; Metals Gr oup; Processing; Rail Equipment Group; Services.

Principal Competitors: Commercial Metals Company; Metal Manage ment Inc.; Philip Services Corporation.


  • Key Dates:
  • 1885: Joseph Joseph launches a scrap iron business.
  • 1921: The company is renamed the David J. Joseph Co.
  • 1975: The Joseph family divests ownership of its namesake comp any to SHV Holdings, N.V.
  • 1987: DJJ creates an international division.
  • 1996: Western Metals Recycling L.L.C. is created.
  • 1998: The company forms River Metals Recycling L.L.C.
  • 2000: The DJJ Metals Group and Gemini Recycling Group L.L.C. a re launched.

Additional topics

Company HistoryMiscellaneous Wholesale Goods

This web site and associated pages are not associated with, endorsed by, or sponsored by The David J. Joseph Company and has no official or unofficial affiliation with The David J. Joseph Company.