FORT WAYNE — In eight short years, Steel Dynamics Inc. has grown from the newest and smallest steel manufacturer to the sixth largest in the U.S.
With $2 billion in sales in 2004, and a still undetermined pre-tax profit in the range of $400-$500 million, “it is an amazing story,” said Keith Busse, chief executive officer of the Fort Wayne-based corporation.
Busse said that when SDI first began producing steel at its Butler mill in 1996, “There were 50 steel producers in the United States, and we were the baby.” Today, he said, only 25 steel producers remain, thanks to mergers, business failures and bankruptcies.
“Of those 25, we’re number six,” he said, ticking off the names of the top five: Mattel Steel (formerly ISG), U.S. Steel, Gerdau Ameristeel, Nucor, and AK Steel.
SDI now operates three divisions — the Flat Roll Division at Butler, Structural and Rail Division at Columbia City and Bar Products Division at Pittsboro, west of Indianapolis.
What has taken place in the company’s eight years would take a book to recount. But the “fun part” of the story, Busse said, has been the creation of 1,600 Hoosier jobs. All but 300 of those jobs are in northeastern Indiana, specifically in DeKalb and Whitley counties.
“What I see (locally) are 1,600 people who have a faith in their future, and they have that faith because they are a part of the economic resurgence that we are enjoying,” Busse said.
Most importantly, Busse said, are that the 1,600 jobs pay “extraordinarily” well at $70,000 and up a year.
“Profit sharing adds another $22,000 — on average — and that is huge to their (workers’) pensions ... in that that money is invested and is growing some rather large sums that will be available when the workers retire, available to them and to their families.”
Those workers are buying homes and automobiles and investing in families, because “they know they are going to have those jobs for a long time to come,” Busse said.
Busse likes to point out that his company’s success is not without irony.
“They said it couldn’t be done, that we couldn’t build a steel plant in northeast Indiana because there were no skill sets,” he said. “But we didn’t want any, we didn’t want any bad habits” from an experienced workforce.
“We said we wanted to teach our workers, and they will be better and more productive, and we have done that,” he pointed out. “Butler is the premier steel-making plant, and the most productive of anywhere in the world.”
SDI is producing 3 to 4 percent of America’s flat-rolled steel, and its production is absorbed “close to home,” in the Midwest and Canada.
The Butler mill is surrounded by businesses that have located and prospered in that production — companies such as New Process Steel, Heidtman Steel, Magic Coil and New Millennium. Not to mention the Evans trucking company of Butler, which Busse points out “has grown and grown” as a result of SDI.
OmniSource, the major supplier of scrap to feed the SDI furnaces, has benefited greatly as well, Busse said, but it is impossible to define SDI’s full impact as the result of buying goods and services and making its payroll.
Butler and DeKalb County have been described as the “new home of steel in America” by Lincoln Schrock, director of Indiana Northeast Development, which works to attract new businesses and industries to northeast Indiana. Busse said that may be a bit of an exaggeration, but the location certainly has a future for SDI.
Busse said SDI has completed the purchase of additional land north of the SDI plant (SDI now owns 2,000 acres in Dekalb County) to allow for the addition of a new iron-making technology.
Traditional iron-making, Busse explained, involves the use of coke, and even with the latest in smoke-scrubbing technology is a “dirty” process.
“One of the good things that has come out of our Iron Dynamics venture is that we have developed a way to make iron in an environmentally friendly way, without the use of coke,” Busse said. That iron-making technology will be used in a new plant, to be located north of the SDI plant at Butler.
The Columbia City operation very soon will be supplying railroads with steel rails, Busse noted. CSX, the Canadian Railway and Norfolk Southern all have shown an interest in the Class I rails in final development at Columbia City.
Busse describes himself as a “clean nut,” insisting on constant washing and painting of buildings at all SDI locations. He said that work has resulted in a new entrepreneurial niche for businesses specializing in that work.
And, he said, “Not a single tree gets cut anywhere without my permission.” He said, “I value the environment and take pride in pristine facilities.”
A discussion of SDI’s impact on its communities wouldn’t be complete without mention of the company’s philanthropic giving, which Busse said will be ever-increasing.
From its beginning, SDI has reinvested heavily in itself, a positive move that has substantially reduced the company’s massive debt.
“We have now turned that debt around, and are getting more involved in charitable giving,” he said.
Busse said the company also will do more in providing a leadership role in economic development issues. He said when SDI acquired the Pittsboro operation from Qualitech Steel, the state of Indiana had lost a $30 million investment, not to mention jobs and taxes that never materialized.
“Since taking that plant over, the results have been beyond anyone’s expectations,” he said. “We are having a positive impact.”
