Russell's Black Gold

Created: November 10, 2010

J. T. Russell & Sons grows family asphalt business through diversification

The purchase of an old textile plant has enabled significant expansion of the company's cold-patch asphalt business.
The purchase of an old textile plant has enabled significant expansion of the company's cold-patch asphalt business.
At the time of its first plant purchase from CMI (now Terex Roadbuilding), J. T. Russell only paved about 50,000 tons of asphalt per year. J. T. Russell's incredible expansion in the asphalt...
At the time of its first plant purchase from CMI (now Terex Roadbuilding), J. T. Russell only paved about 50,000 tons of asphalt per year. J. T. Russell's incredible expansion in the asphalt business can be traced back to a single event when the company's then asphalt mix supplier would not make mix for paving crews, delaying a parking lot project.
To date, J.T. Russell & Sons has produced nearly 50,000 tons of warm mix asphalt with Terex foamed asphalt systems.
To date, J.T. Russell & Sons has produced nearly 50,000 tons of warm mix asphalt with Terex foamed asphalt systems.

Warm mix

JTR continues to expand and innovate with its asphalt production business. It is currently evaluating different warm mix asphalt systems.

The Conover plant is equipped with a Terex foamed asphalt warm mix system, while a second plant is equipped with chemical additives for reducing mix temperatures.

The Terex warm mix system simply injects hot liquid AC with water at a single mixing point. This exclusive expansion chamber foams the asphalt, which is then immediately pumped into the drum via the existing AC line to thoroughly coat the aggregate. This warm mix system has successfully reduced mixing temperatures by up to 90 degrees F.

Most of JTR's warm mix produced to date has been used on private jobs, but the company is also working the mix into state projects. To date, nearly 10,000 tons of the chemical warm mix asphalt has been produced, while 50,000 tons of the foamed warm mix asphalt has been produced using the Terex system.

"We are seeing temperature reductions from 300 to 270 degrees F, which is resulting in significant fuel savings," comments Russell.

Cold patch, hot oil

JTR's success with asphalt is not limited to hot and warm mix. The company also has a profitable cold patch business.

About 15 years ago, the marketers of Quality Pavement Repair (QPR) - a modified cold mix product bagged and sold through home improvement stores such as Lowes - needed a vendor to make and bag the mix for the North Carolina region.

JTR agreed and proprietary oil was shipped to the Charlotte plant site, and the company set up a bagging operation in 1995 at their Albemarle Location.

"JTR's intention was to give the paving crews work during the short winter months," explains Russell. Crews bagged nearly 1,000 tons of QPR cold patch during that first year.

As time went by, JTR was asked to increase bagging production of the cold patch. However, demand quickly outpaced the company's supply capabilities at the Albemarle operation. A separate facility was needed where a double bagging system could be installed and more of a full-time operation could be established.

At nearly the same time, Russell had a family friend who was getting out of the textile business. This friend asked him to consider purchasing the building for the QPR business. There was only one problem. The new bagging operation for QPR required approximately 30,000 square feet, but the textile building was 10 times that size.

Out of courtesy, Russell agreed to look at the building. Upon inspection, he noticed something that piqued his interest and made purchasing the behemoth financially feasible.

"I saw pipes with insulation leading to two huge tanks," says Russell. He learned that those tanks had a 1 million gallon capacity each and inside the tanks were heat coils that could be used in heating liquid asphalt. There was also a third tank that held 250,000 gallons.

Russell immediately saw an opportunity for the hot mix business. Initially, he thought this would give JTR a competitive advantage by being able to purchase asphalt binder in bulk when the price was low. When the friend gave Russell a favorable asking price for the building, the company made the purchase.

This ushered in an entirely new business for the company. Not only would the producer buy asphalt binder in bulk, but they could also sell and ship binder to other asphalt producers.

Today, from its four terminals, JTR markets polymer-modified, rubber-modified and Performance Graded asphalt binders meeting state DOT specifications in Virginia, North Carolina and South Carolina.

The cold patch business has also reaped a substantial benefit with JTR being in the binder business. The company now blends the oil used in QPR, growing that product's profit margin.

This incredible expansion into the asphalt business can be traced back, at least in part, to that one parking lot job in the mid 1980s when JTR's asphalt supplier would not start the plant for a measly 60 tons of asphalt. Thinking back to the project, Russell is thankful for the producer not making the mix.