Shop Doc – Chips

Today’s Machining World Archive: October 2005 Vol.1, Issue 08

Dear Shop Doc:

We are an aerospace company in California running Aluminum 6061-T6, generating 100,000 pounds of chip waste per month. We work in eight to twelve hour shifts, seven days a week. We use 10-weight hydraulic oil with sulfur added, paying $4.50 per gallon. Right now we are disposing of our chips in bins, and selling them wet to a scrap metal dealer for .40 per pound. The chip waste is machined in “6’s and 9’s,” curls for the most part. We have 500-square feet of floor space available for handling the scrap (not heated).

How can we consolidate our chips to get the highest resale value for them? Would we maximize the value of our scrap by using a briquetting system? Or is simply spinning the chips a better option? We also want to know the best method for recovering coolant for both economic and environmental reasons.



I contacted three manufacturers: Meaden Precision Machined Products of Burr
Ridge, IL, Manth Brownell of Kirkville, NY, and Curtis Screw of Buffalo, NY, to see
how they disposed of their aluminum chips. All three use centrifuges to spin the oil
out of the chips, rather than using briquetting systems, which compact chips into
solid pucks, which are easier to store, leave little residual oil, and can sometimes
bring considerably more money than loose chips. I tried to find out why these
three manufacturers dispose of their chip waste the way they do, and if there is a
better way.

Wes Skinner of Manth Brownell said he receives, from a scrap dealer, about fifty cents per pound for a mixture of aluminum 6061 and 6262. According to American Metal Market, aluminum scrap sells for 55-56 cents per pound; Skinner says he receives a bit less than the market price because there is still about 2% of the oil remaining in the chips after he spins them. He also recovers oil after the chips are spun, which can save significant money.

I also contacted an aluminum broker/ingot producer in California, who wanted to remain anonymous (all aluminum brokers I talked to wanted to remain anonymous), to find out if they prefer pucks to chips. He refused to quote me a price on aluminum scrap, like every aluminum broker refused, but he told me that his company does not pay a premium for pucks because it is difficult to know if the metal is pure.

Then I called PuckMaster, a company that manufactures briquetting equipment, and Prab Inc., a company that makes both centrifuging machines for drying chips and briquetting equipment. Tim Sernett, National Sales Manager at PuckMaster, said that in puck form (produced from the PuckMaster system) aluminum 6061-T6 is presently worth about $0.72 to $0.75 per pound delivered to a primary mill, which will not accept aluminum in chip form, wet or dry. According to Tim, primary aluminum mills typically buy scrap only from a select group of brokers, so usually a manufacturer’s only option is to sell its scrap to a scrap dealer, but PuckMaster says that it offers a brokerage service, via contract to market, and sells this material in puck form to primary mills or to direct export to eliminate the middleman scrap dealer network. Tim calculated that CHIPS could be making $0.25-$0.32 per pound more than he is collecting presently, by selling directly to the primary mill (Tim subtracted between $0.03 to $0.07 for the cost of shipping to the mill, and a brokerage fee). This would mean that the revenue for CHIPS, producing 100,000 pounds of aluminum per month, receiving $0.40 per pound presently, could be $320,000,00 more if the maximum $0.72 per pound was redeemed. However, it is important to realize that if CHIPS produces 100,000 pounds of aluminum chips per month not spun, a significant fraction of that weight comes from residual oil.

Another advantage of PuckMaster briquetting systems is their PLC display, which shows how many pucks have been produced. This helps insure that manufacturers get paid for the true amount of metal that they have recycled.

Also, PuckMaster and other briquetting systems reclaim a significant amount of coolant, which would otherwise have been lost. According to Tim, PuckMaster will remove approximately 18 gallons of cutting fluid per 1000 pounds of aluminum chips processed. Therefore, processing 1,200,000 pounds of aluminum per year will recover 21,600 gallons of coolant, which will be claimed for reuse every year. At a cost of $4.50 per gallon for coolant, CHIPS would recover $97,200 per year in coolant, which could be recycled and reused. This will be a significant increase from CHIPS’ current methods of oil conservation.

Bob Meyers, vice president of sales and marketing from Prab Inc., a company that produces both centrifuges and briquetting systems, has a different perspective. He said that the market for disposing aluminum chips and briquettes can be very regional, and that the most likely destinations for manufacturers to capitalize on their aluminum scrap in California are scrap dealers, who themselves briquette wet, clean chips for bulk shipment to Asia. He said that the value of chip to dealer is pretty much the same if it is brought in wrung or briquetted. Bob calculated that if CHIPS is getting $0.40 per pound for wet chips (10%-15% moisture by weight), he should get approximately $0.50 per pound if the chips are wrung (resulting in 2% or less residual moisture) since he will not be penalized for the moisture. Bob concurred with PuckMaster that any real premium price would be at the large volume broker level who is handling a specific, clean, mag- separated, alloy briquette ready for bulk export shipment. He said that in the case of CHIPS, a Prab Inc. chip processing system (shredder, wringer etc.) could be provided for about $110,000.00 vs. a Prab Inc. briquetter system (including pre-conditioning of the turnings and solids) for around $160,000.00.

So CHIPS, You’re cheating yourself out of money, and you don’t have to. Now that you have some knowledge, call Prab Inc. and PuckMaster and get the chips rolling (or maybe the puck). And tell ‘em Shop Doc sent ya.

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