Joseph Kelly of 8th ward dwelling 354 St. Louis was an Irish immigrant (listed as railroad contractor on census) Capt Joseph Kelly as you mentioned was a former British soldier who brought his expertise of drill to bear when he formed a unit of men as part of Father John B Bannon's Temperance and Benevolence Society in St Louis in 1857. His first SOS card lists him as Capt Co E 1st Regt. Washington Guards at Camp Jackson. The Second listing for him appears as a result of his commission in the CSA as Captain Searcy's Battalion, Parson's Div in Oct 1862. Parson's knew Kelly from his time under Parson's in the 6th Div MSG see OR Series I, Volume III, p. 37. Bannon was #2 under Patrick Ryan, Vicar General at the "Old St. Louis Cathedral" (now under the Arch in St. Louis). Kelly appears to have led his unit through Wilson's Creek where he was wounded and then after Pea Ridge the unit was entered into the CSA as Co F of the 5th Missouri. Patrick Caniff succeeded Kelly as Capt of Co F when Kelly was promoted to Col. on Parson's staff. Caniff later was killed at Franklin TN in 1864. Col Kelly died May 1870 in St. Louis.
The Missouri state gazetteer 1860 lists his unit as meeting and drilling every week. See:
http://books.google.com/books?id=s80yAQAAMAAJ&pg=PA285&lpg=PA285&dq=capt+joseph+kelly+washington+blues&source=bl&ots=eWPXk1Vl-2&sig=OXrP9verzKC8wygJusgFJ-xSZbY&hl=en&sa=X&ei=43lGUa6qGYThqAHkyID4CA&ved=0CDcQ6AEwAzgK#v=onepage&q=capt%20joseph%20kelly%20washington%20blues&f=false
(Its long but works has to be cut and pasted)
The book "Missouri Brothers in Gray....Letters of William J Bull and John P Bull " seem to have the most detail of the actual transshipment and what steamboats were used. On Page 5 and 6 direct reference is made to Capt Kelly and the Washington Blues being the guard on one of the boats.
http://books.google.com/books?id=s80yAQAAMAAJ&pg=PA285&lpg=PA285&dq=capt+joseph+kelly+washington+blues&source=bl&ots=eWPXk1Vl-2&sig=OXrP9verzKC8wygJusgFJ-xSZbY&hl=en&sa=X&ei=43lGUa6qGYThqAHkyID4CA&ved=0CDcQ6AEwAzgK#v=onepage&q=capt%20joseph%20kelly%20washington%20blues&f=false
Given the comments of McNamara and the Bull brothers I feel pretty good about saying Capt. Joseph Kelly of the Washington Blues and members of that unit were escorts of guns and powder in May of 1861 from St. Louis to Jeff City.
The original source of the powder is a bit sketchier. Several possibilities or combinations thereof exist
1. Powder and arms were purchased by various individuals involved in the Militia unit formations in the ethnic neighborhoods of St. Louis and consolidated to be shipped.
2. Powder and arms were released to units by Capt Bell of the Federal Arsenal prior to he being relieved of duty. He was known to be a supporter of the St. Louis Grays movement.
3. We know that powder and arms were shipped to St Louis from Baton Rouge Federal Arsenal on the J.C. Swon, arriving at the St. Louis docks on May 8, 1861 and part of that shipment may have been a source. see Encyclopedia of St Louis Vol 4 pg 2433
4. Jim McGhee reports that Brig. Gen. Harding in his memoirs states he bought powder and arms for the purpose.
My personal opinion is to lean towards a conglomeration of 1,3, and 4, if we are to believe McNamara's claim of 70 tons. If that amount is true and only one choice is allowed then I think #3 makes the most sense. The quantity is appropriate, it would be easier to just handle the material on the dock moving from one steamship to another. Remember Kelly was a wholesale grocer in the city and had the shipping contacts to help facilitate the movement as well. Part of this shipment apparently was taken or at least reported to be taken to Camp Jackson and was one of the stated reasons Lyon marched out with the German regiment.
John R