Cost Profit

Cost Profit

Our MAX-4000 SP Aluminum Sweat Furnace (3 primary burners) is capable of producing 625,000 lb/month of aluminum ingot (re-melt sow ingot commonly called RSI sow) That figure is based on an average of 50% aluminum recovery from scrap (50% aluminum/50% other metals or combustible material) operating a total of 400 hrs per month. Our most successful customers operate their furnaces using 2, 10 hr. shifts, 5 days a week. There is a total workforce of 4 operators, 2 per shift.  Based on your tonnage per month available, the MAX-4000 SP would be your best choice.  

Capital Investment

MAX-4000 SP AL Sweat Furnace w/Install and training – $ 198,000.00

Gas and electrical services to our equipment – 20,000.00

Shipping of all components to install equipment – 8,500.00

Build of furnace tools specific to the type of  operation – 10,000.00 – $236,500.00

This total cost is assuming that the facility already has the following:

Concrete pad and a building with a minimum of a 60 ft. X 80 ft work area with a minimum of a 20ft. peak in roof height.
Fork lift with 6 Ton capacity.
Skid steer loader with bucket and grapple (Medium size, heavy duty work load)
3 phase 100 AMP electrical service
Gas supply within 100 ft. of furnace capable of providing 6,000 cu/ft/hr @ 5 PSI Natural or vaporized liquid propane-15 PSI.

Note that the building can be a pole shed type, lean-to type, or fully enclosed type of structure.

Operating Costs and Maintenance
Average operating costs reported back from our customers average are as follows:

Fuel – $0.02.5 per lb. of aluminum processed (based on today’s natural gas prices)
Operators/forklift/loader/electricity – $0.01.5 per lb of aluminum processed
Furnace maintenance – $0.0025 per lb of aluminum processed

 

Cost Profit Analysis


Recycling Services International, LLC provides EPA compliant equipment for processing aluminum scraps from a multitude of end use sources. Our furnaces use the “latest available technology” to provide energy and control efficiency.

The “finished” products from the furnaces are as follows:

  • Aluminum Ingot….various grades depending on segregation of materials for re-melt in spec material furnaces.
  • Clean Ductile, Clean HMS 1 or HMS 2 steel…ready to ship to steel mill for direct charge into their furnaces.
  • Dross Skimming, furnace hearth dross and ash are to be used in rotary furnaces making spec material.

There is zero waste with this type of operation.

 

Our MAX-4000 SP Aluminum Sweat Furnace (3 primary burners) is capable of producing 625,000 lb/month of aluminum ingot (re-melt sow ingot commonly called RSI sow) That figure is based on an average of 50% aluminum recovery from scrap (50% aluminum/50% other metals or combustible material) operating a total of 400 hrs per month. Our most successful customers operate their furnaces using 2, 10 hr. shifts, 5 days a week. There is a total workforce of 4 operators, 2 per shift.  Based on your tonnage per month available, the MAX-4000 SP would be your best choice.

 

Capital Investment

 

MAX-4000 SP AL Sweat Furnace w/Install and training …………………………………………….$ 198,000.00

 

Gas and electrical services to our equipment……………………………………………………………..20,000.00

 

Shipping of all components to install equipment………………………………………………………….8,500.00

 

Build of furnace tools specific to the type of operation …………………………………………………10,000.00

$ 236,500.00

 

This total cost is assuming that the facility already has the following:

  • Concrete pad and a building with a minimum of a 60 ft. X 80 ft work area with a minimum of a 20ft. peak in roof height.
  • Fork lift with 6 Ton capacity.
  • Skid steer loader with bucket and grapple (Medium size, heavy duty work load)
  • 3 phase 100 AMP electrical service
  • Gas supply within 100 ft. of furnace capable of providing 6,000 cu/ft/hr @ 5 PSI Natural or vaporized liquid propane-15 PSI.

Note that the building can be a pole shed type, lean to type, or fully enclosed type of structure.

 

Operating Costs and Maintenance

Average operating costs reported back from our customers average are as follows:

Fuel…………………………………………………$0.02.5 per lb. of aluminum processed (based on today’s natural gas prices)
Operators/forklift/loader/electricity……..………….$0.01.5 per lb of aluminum processed
Furnace maintenance……………………………….$0.0025 per lb of aluminum processed

Some of our customers are reporting total operating costs and maintenance costs totals of 4 cents per lb. and some at 5 cents per lb. processed depending on location and fuel type.

 

Average maintenance includes the following:

Annual  refractory (furnace lining) repairs or replacements……………………………$ 5,000.00

Annual inspection service (as required by EPA)……………………………………….$ 2,500.00

Annual average components replacement costs ……………………………………….$ 1,500.00

Annual pouring accessory and safety equipment costs…………………………………$ 1,500.00

Total average annual maintenance and accessories        $10,000.00

 

Note that furnace lining replacements are done as needed per area due to damage or wear. It is rare that the entire lining is replaced all at one time. Much of it depends on how much care the operators take in the process.  For example, the primary floor and walls average replacement every 2 years, holding chamber floor every 3 years, holding chamber walls and both roofs every 5 years, afterburner chamber every 5 years, stack refractory every 10 years.

 

Permitting and Compliance

The MAX series furnaces all are compliant with CFR 40 part 63 MACT ruling. The ruling requires at least 0.8 seconds retention time in the afterburner chamber. All MAX series furnaces have at least 1.5 seconds retention time figured in the afterburner chamber only. We have not been denied a permit in the US or Canada at this point of time. We use a compliance consulting company to apply for permits at an average cost of $2,500 per permit. Permit fees vary from state to state but the annual average is $700 to $4,500.  Many states allow for a Permit by Rule where others require a full title 5 permit.

Also required is proof of a minimum of 1600 deg. F operating temperature in the afterburner chamber while processing. Compressed data is required in 15 minute averages and 3 hour block averages. We provide proof of compliance with the use of a data logger and a data management program that is included in the price of the equipment.

Profitability

Profit from these units depends mainly on the cost of the material being introduced into it. A general guideline we use, based on reports from our customers, is a profit margin of 15% to 25% return on your material investment.  There are many variables such as the grade of aluminum, amount of loss due to type of scrap, freight costs to the mills, and spot prices of finished product. For instance:

380 type aluminum sow price average today is $1.00 per lb. The scrap type is automotive cast (irony cast aluminum) at a cost of  $0.50 to $0.80 per lb depending on how much steel is in the castings. The price of  HMS 1 scrap steel is around $.12 per lb. Metal loss minimum (oxidized aluminum) is 4% and gets higher with thinner material types such as aluminum sheet (as much as 7% melt loss). So if you are processing 70% aluminum recovery scrap (irony aluminum) at a cost of  $0.50 per 100 lb.……

 

Matrial…………………$50

Cost to process………….  5

Metal loss………………   2

 

Total investment            $57

 

Finished aluminum……$70.00

Finished steel………….. 3.60

 

Total finished…………$73.60 minus $57.00 = $16.60 per 100 lb. profit

 

That equates to $1,245,000.00 profit on an average output of 7,500,000 lbs of aluminum per year. A 17% return off of the scrap material investment. Average output figure based on 20 hr day, 5 days a week, at 1,500 lb per hour molten aluminum.