Scrap Industry News

PAPER GIANTS SPIN THEIR OWN WEB

Three of the largest paper companies in the world have announced plans to jointly form an online venture to buy and sell paper and other forest products.

International Paper, Purchase, N.Y., Georgia-Pacific Corp., Atlanta, and Weyerhaeuser Corp., Tacoma, Wash., have not yet announced the name of the online marketplace for forest products that they are in the process of creating. Although secondary fiber is not specifically mentioned as one of the items to be traded on the site, a news release issued by the companies says the “electronic marketplace” will provide “both procurement and sales functions” in order to “streamline purchasing operations, reduce inventories, cut internal costs and increase capital efficiency in the industry.”

“The marketplace will operate as an independent entity with its own board of directors and management team,” the news release states. “Initially, the three founding companies will each have an equal equity position, but it is expected that more partners will join the initiative. Based on demonstrated success, the companies will consider taking the entity public.”

“Rapidly evolving technology is dramatically changing the global marketplace,” says Weyerhaeuser chairman, president and CEO Steven R. Rogel. “This initiative will aggressively shape the electronic marketplace in the paper and forest products industry,” adds Rogel. “It will also promote better relationships with other trade partners, such as suppliers.”

International Paper says its existing relationship with PaperExchange.com “will remain part of the company’s e-commerce strategy. The joint news release also notes that the creation of the marketplace “is subject to appropriate governmental and other approvals.”

ALTON NEWELL DIES AT AGE 86

Alton Newell, one of the pioneers in developing the auto shredder, died in late March at age 86.

Newell’s life could not have been scripted better to reflect the “only in America” rags-to-riches stories that can be found in both American history and within the scrap industry.

Alton Newell was the son of Oklahoma sharecroppers who moved to California in the 1920s and became migrant farm workers. As a teen, Newell began working at auto salvage and scrap yards in Los Angeles, and opened his own scrap business at age 21. He moved to south Texas in 1938, and established Newell Recycling in San Antonio in 1947.

After having built a successful scrap metal business in San Antonio, Newell spent 1959 developing his version of an automobile shredder, one of several models that were developed in that time period. Newell configured his shredder to run on a smaller, 500 horsepower engine, which made it more affordable than other early models.

Newell secured a patent for his shredder in 1965, and spent the remaining decades of his life involved not only in scrap processing operations, but also in building up Newell Industries Inc. (originally Newell Manufacturing Co.). Newell Industries became the market leader for years in the production, sale and installation of auto shredders.

Scrap processing operations carrying the Newell name also proliferated in the 1960s and ensuing decades, with Newell Recycling operations located in some 25 cities, according to Robert Triesch III, Alton Newell’s grandson and current president of Newell Recycling in San Antonio. Alton Newell later divided scrap operations—spread out in locations ranging from Texas and New Mexico to Georgia, Alaska and Hawaii—among different family members.

According to Triesch, Newell made many long-lasting friendships in the scrap industry, including with the Feldman family, founding members of Commercial Metals Co., Dallas. The Feldman Foundation dedicated the Winnie and Alton Newell Park in Jerusalem, Israel to Alton and his wife of 62 years, Winnie. The dedication was noteworthy, says Triesch, because it was a Jewish foundation dedicating a park to a Christian couple in a Muslim Arab section of the city.

FERROUS PROCESSING, DJJ ENTER JOINT VENTURE

The David J. Joseph Co. (DJJ), Cincinnati, and Ferrous Processing & Trading Co., Detroit, have formed a joint venture company that will target certain scrap brokerage and prompt scrap processing opportunities.

The new venture, called Gemini Recycling Group LLC, will be based in the Detroit area and is 50/50 jointly owned by the two companies. John P. Suchon, former international ferrous trading manager for DJJ, has been named vice president and general manager of Gemini.

According to Gemini spokesperson Emile Mahanti, Gemini will target on-site and off-site scrap processing opportunities with major industrial scrap generators. Brokers working for Gemini will be able to call upon DJJ’s worldwide brokerage network to market materials processed through Gemini, at the same time using Detroit-based processing equipment operated by Ferrous Processing & Trading.

Ferrous Processing & Trading processes more than 2.75 million tons of scrap annually at ten facilities in Michigan and Ontario.

DJJ has 13 trading offices and more than 30 scrap processing and mill services sites.

Company officials were unwilling to say whether a successful joint venture arrangement would spur the two companies to examine further mutual business relationships.