Dowa Holdings - Company History
- Founding
- In September 1884 Fujita-gumi, the firm of Fujita Denzaburo, received the transfer of the state-run Kosaka mine in Akita from the Meiji government. The kuroko ore there, in which gold, silver, copper, zinc and lead were mixed together, was hard to separate, and for ten years after the acquisition no smelting technology could be made to work and the losses continued. Dry smelting was brought into operation in January 1898 and the flash smelting of kuroko ore in June 1902, and by 1906 Kosaka had been pushed to first place in Japan by value of output. A rolling mill opened at Toyosaki in March 1919 widened the company into metal processing; the trade name was changed to Dowa Mining in December 1945, and the shares were listed on the Tokyo Stock Exchange in July 1949. In October 2006 the group moved to a holding-company structure and became the present Dowa Holdings.
- The Decision
- The feedstock going into the smelters has been switched from the company's own ore to imported ore, and from imported ore to waste. In February 1971, as the share of imported ore rose and the advantage of self-mined ore broke down, Dowa established the coastal Akita Zinc smelter and switched to imported ore, moving the source of earnings from the mines to smelting capacity. After domestic mining ended, a furnace for treating automobile shredder residue was installed at Kosaka Smelting in April 2002, and in October 2006 the company moved to a holding-company structure and split into five operating companies. Changing to a posture in which the same furnaces recover gold, silver and copper from scrapped appliances and cars is what created a shape in which smelting goes on without any mines.
- Today
- Environmental and recycling operations, 15 per cent of revenue, produce three-tenths of business profit. In the year to March 2026 revenue was $4.7B (¥745bn), operating profit $216.2M (¥34bn) and net profit $395.2M (¥63bn). Smelting is the largest business, at $2.2B (¥352bn) of sales and $124.6M (¥20bn) of profit, but environmental recycling earns $104.3M (¥17bn) on sales of $702.5M (¥111bn), a margin of 15 per cent. Metal processing follows with $931.3M (¥147bn) and $62M (¥10bn), electronic materials with $607.6M (¥96bn) and $7M (¥1bn), and heat treatment with $215M (¥34bn) and $17.1M (¥3bn). The structural reform begun in November 1999, which took ROA as its yardstick and compressed both assets and headcount, is what left a company with no mines of its own able to go on making money out of smelting.
- Competition
- Among the big non-ferrous companies, Dowa is the only one to have moved the entry point of its raw material to waste. Sumitomo Metal Mining acquired the Sierra Gorda copper mine in Chile in 2011, taking the route of securing feedstock through mine interests. Mitsui Mining & Smelting stopped mining at Kamioka in 2001 and moved into electronic materials, and goes on smelting with imported concentrate and recycled feedstock. Dowa, while bringing the Los Gatos mine in Mexico into operation in July 2019, built its scale on the collecting side — scrapped appliances and cars — and raised environmental recycling into the earnings source second only to smelting. In April 2025 it consolidated three zinc-related companies into Akita Zinc, and it will put on the order of $632.3M (¥100bn) into the single Akita site by the 2030 financial year. What now decides the margin is not the rise and fall of metal prices but the volume of waste taken in and the fee charged to treat it, and on the raw-material side Dowa has parted ways with the two companies that keep buying mines.
Timeline
1884–1944Fujita-gumi, the making of a mining business, and the fight to smelt kuroko ore
- 1884Fujita-gumi acquires the state-run Kosaka mine — Dowa's founding
- 1897Hydroelectric generation begins at Kosaka
- 1898Dry smelting of kuroko ore begins at Kosaka
- 1902Flash smelting of kuroko ore begins at Kosaka
- 1906Kosaka ranks first among all Japanese mines by output value
- 1915The Hanaoka mine in Akita bought for ¥1.28 million
- 1916Doyashiki orebody found; eleven Okayama mines consolidated as Yanahara
- 1917Fujita-gumi takes zaibatsu form; mining split off as Fujita Mining
- 1919Toyosaki rolling mill built — entry into metal processing
- 1928Toyosaki copper and brass works established
- 1937Reorganised as Fujita-gumi Co., Ltd.
- 1942Teikoku Kogyo Kaihatsu and Tohoku Kogyo take equity stakes
1945–2001The mines contract, the company hunts for something else to be
- 1945Trade name changed to Dowa Mining
- 1949Listed on the Tokyo Stock Exchange
- 1958Tokyo Netsushori Kogyo made a subsidiary — entry into thermal processing
- 1963The Matsumine orebody found at Hanaoka
- 1965Entry into electronic materials
- 1971Akita Zinc established — coastal zinc smelting on imported ore
- 1972Mines scaled back and headcount cut
- 1977Entry into environmental recycling; Special Committee for Breaking Through the Crisis set up
- 1982Semiconductor materials laboratory opened
- 1989The Kosaka smelter separated as Kosaka Smelting
- 1992Shiojiri plant built for ceramic substrates
- 1994The Tizapa zinc mine in Mexico starts up
- 1999Structural reform announced
- 2000322 voluntary redundancies; entry into waste treatment
2002–2023Becoming an environmental and recycling company, and a record profit
- 2002Yoshikawa Hirokazu becomes president; concentrated investment in environmental recycling
- 2004Controlled-type final disposal site built at Kosaka Smelting
- 2006Renamed Dowa Holdings; move to a holding-company structure
- 2006About ¥10bn invested in a new furnace for recycled feedstock
- 2007Yamaha Metanix acquired; record net profit of ¥26.3bn
- 2008Entry into zinc recycling in earnest
- 2009Falls into loss on the Lehman shock
- 2011Thermal processing expanded in earnest
- 2019The Los Gatos zinc mine in Mexico starts up
- 2022Record profit renewed on the surge in metal prices
- 2023Environmental and recycling operations begin in Indonesia
Founding Story
1884–1944Fujita-gumi, the making of a mining business, and the fight to smelt kuroko ore
Dowa dates its founding not from the trading house that Fujita Denzaburo (藤田伝三郎) had built on army supply contracts, but from 1884, when the Meiji government transferred the state-run Kosaka mine to Fujita-gumi — an asset whose value sat behind a technical wall nobody had yet climbed. Ten loss-making years brought an order to close the mine; that the order was overturned, and that flash smelting of kuroko ore was finally made to work in 1902, set the pattern for everything that followed.
Kuhara Fusanosuke overturns an order to close the mine
In 1881 Fujita Denzaburo (藤田伝三郎) formally established Fujita-gumi with capital put up by three brothers[1], and in 1884 he received the transfer of the state-run Kosaka mine from the Meiji government, entering the mining business[2]. The development capital was secured by borrowing ¥200,000 from the Mori family, former lords of the Choshu domain[3]. Kosaka was an unusual mine, producing a distinctive 黒鉱 kuroko ore in which several metals — gold, silver, copper, zinc and lead — were mixed together, and for a long time it was recognised that establishing a smelting technology able to separate those metals efficiently was the single greatest key to making a business of it[4]. The early years after the acquisition were a run of trial and error, and the company was hard-pressed.
Ten years after the transfer the smelting technology still had not been established and the losses continued, so the Mori family, as lender, issued a formal order to close the Kosaka mine[5]. Kuhara Fusanosuke (久原房之助), who had arrived to wind the mine down, argued strongly that the business had to be kept going, and by winning the personal backing of Inoue Kaoru (井上馨) he had the closure order withdrawn — a historic reversal[6]. In 1902 the flash smelting of kuroko ore was at last established and production began in earnest[7], and in 1906 Kosaka achieved the turnaround of ranking first among all mines in Japan by value of output[8]. The experience of surviving the threat of closure and winning through by technical innovation was retold inside the company for decades as the origin point of Fujita-gumi's management philosophy.
The success of kuroko flash smelting was rated a technical landmark for the Japanese non-ferrous metals industry, and at a stroke Fujita-gumi acquired standing as one of the country's leading mining companies. The strong will to keep the business going and the appetite for technical challenge that Kuhara Fusanosuke had shown were handed down inside the organisation as the core of the management culture of Fujita-gumi and later of Dowa Mining, and went on serving as the driving force through crisis after crisis. Kosaka's technical success was not merely one firm's achievement: it was widely recognised as a symbolic event that contributed to the modernisation of Japanese mining as a whole.
Hanaoka and Yanahara, and a deliberate spreading of the mines
To prepare for the falling grade of the Kosaka orebody, Fujita-gumi set out a policy of actively acquiring new mines. In 1915 it bought the Hanaoka mine in Akita Prefecture for ¥1.28 million, only to run into declining grades immediately after the purchase[9]. The following year, 1916, it had the good fortune to discover the large 堂屋敷 Doyashiki orebody, and Hanaoka grew into the main mine after Kosaka[10]. In the same year it consolidated eleven small mines in Okayama Prefecture into the new Yanahara mine, securing in parallel a stable supply base for sulphide ore[11].
By acquiring mines of two different characters — non-ferrous metal mines and sulphide mines — and combining them, Fujita-gumi made explicit a strategy of deliberately breaking free from dependence on any single mine. A structure took shape in which the earnings base rested on several mines spread across geographically distinct areas, Akita Prefecture and Okayama Prefecture, and Fujita-gumi consolidated its footing as one of the country's leading mining companies. Unable to rely on Kosaka alone, it started up or bought more than thirty mines over this period[12], and Fujita-gumi was counted among the four great companies of Japan's copper industry, building from the late Meiji years into the Taisho years a position on a par with the 財閥 zaibatsu of the day[13]. Spreading risk across both ore type and geography became an important pillar when later crises had to be ridden out, and settled in as a structural element supporting the company's flexibility.
In 1917 Fujita-gumi took zaibatsu form and separated its mining division as Fujita Mining[14]; then, through the recession that followed the First World War and the financial panic of the early Showa years, in March 1937 it merged the partnership Fujita-gumi and was reorganised as Fujita-gumi Co., Ltd.[15] In May 1942, under the Pacific War, two national-policy companies — Teikoku Kogyo Kaihatsu (Imperial Mining Development) and Tohoku Kogyo — took equity stakes[16], and under wartime controls the company's management became deeply bound up with state policy. Through these changes, a wholesale renewal of the board in 1945 became the occasion for changing the trade name to Dowa Mining[17], and after the war the company listed on the Tokyo Stock Exchange in 1949[18], beginning its course as an independent listed company. The sixty-odd years of accumulated mining experience, counting from the acquisition of Kosaka in 1884, formed the managerial resource on which that post-war restart as an independent firm was built[19].
Notes
- 創業百年史 (A Hundred Years Since the Founding, Dowa Mining, 1985)↩
- Dowa Holdings, annual securities report (corporate-history section)↩
- 藤田組史 (A History of Fujita-gumi)↩
- Dowa Holdings, annual securities report (corporate-history section)↩
- 創業百年史 (A Hundred Years Since the Founding, Dowa Mining, 1985)↩
- 創業百年史 (A Hundred Years Since the Founding, Dowa Mining, 1985)↩
- Dowa Holdings, annual securities report (corporate-history section)↩
- 創業百年史 (A Hundred Years Since the Founding, Dowa Mining, 1985)↩
- 創業百年史 (A Hundred Years Since the Founding, Dowa Mining, 1985), the section on the acquisition of the Hanaoka mine↩
- 創業百年史 (A Hundred Years Since the Founding, Dowa Mining, 1985)↩
- 創業百年史 (A Hundred Years Since the Founding, Dowa Mining, 1985)↩
- 企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
- 企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
- 企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
- 企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
- 企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
- Dowa Holdings, annual securities report (corporate-history section)↩
- Dowa Holdings, annual securities report (corporate-history section)↩
- Dowa Holdings, annual securities report (corporate-history section)↩
References & sources
- Corporate Histories: A Century of Meiji, Keizai Shunju-sha (1968), the Dowa Mining entry.
- Dowa Holdings (annual securities reports), including the corporate-history section; the source of the consolidated revenue and profit series from the 1970s onward.
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