To onlookers, the world foundry
industry has received something akin to a jump-start this year.
Like other markets directly related to industrial activity, the
foundries sector followed the downturn seen in construction and
refractories markets in late 2008 and the resulting stagnation
in 2009. But its fall was not as pronounced as that of other
markets like ceramics and refractories, and 2010 has seen some
true demand return to the sector largely from automotive
industry, its biggest end market.
Part of this jump-start comes from
the protection afforded by China through its insatiable hunger
for industrial development. The Asian countrys castings
output accounts for more than a third of global production,
which totalled almost 60m. tonnes in 2008.
Without Chinas production, Modern Casting
estimates that castings production would have contracted by as
much as 5.8% in 2008 far more damaging than the actual
1.5% contraction the market saw, owing to Chinas
astonishing 7% growth in castings output that year.
Other success stories of the
recession include Brazil, South Korea and Poland all of
which made production gains between 1.6-4% in 2008. One of the
most surprising victims of the downturn was India which
over the last five years had been the fastest growing of the
large casting-producing countries whose output fell by
almost 13% to 6.8m. tpa.
Two other notable victims were
Japan and the USA both important countries for foundries
which suffered casting production falls of 18.8% and 8.8%,
respectively. Like many markets, influences on demand are
largely regionalised and some of these regions are still
struggling to regain pre-2008 production levels.
The global economic crisis
had a significant effect on all types of foundries, Joe
Howden of Amcol International Corp. told IM.
The immediate impact of the crisis was on short lead time
castings, ie. automotive foundries, which then steadily
filtered through to the more specialised segments of the
industry producing infra structure castings.
In addition to falling automobile
demand, large infrastructure projects were cancelled or
postponed in many countries particularly in Eastern Europe
(IM June 2009:
Eastern Europes construction market
Although governments around
the world said they would bring forward infrastructure projects
in order to spend their way out of the crisis, the majority of
these projects have as yet not materialised, Howden
Of course, the foundries market is
itself a huge end use sector for myriad industrial minerals;
many of which are also used in the related markets of
refractories and metallurgy. For these minerals, the effects of
the recession are still being felt and will probably
continue to be felt well into 2011.
Four main minerals are used as
molding sands in the foundries market; silica sand, chromite,
olivine, and zircon (see below). Silica sand is the
most widely used foundry sand owing to its high availability
and low cost, while other, more expensive sands, find
applications in niche castings markets.
Traditionally the use of chromite
was reserved for manganese steel castings, but the mineral has
gained more acceptance in a wide range of ferrous and
non-ferrous castings, and is now commonly used to face large
castings or thick sections.
For chromite, the effect of the
recession was a disruption of mine supply and inventory levels
that suppliers are still battling to correct.
The current challenge is
supplying the foundries with raw material, Zelda du
Preez, CEO of South Africas Rand York SA, told
IM. All foundries were running with
minimum inventory levels and surviving on just in time
deliveries. The ramp up in business has left many
suppliers without stock.
Crucially, South Africa the
worlds largest producer of chromite has faced
difficulties with striking workers at a time when its companies
are already struggling to get material to their customers
through a disrupted supply chain. In May a number of chromite
producers, including Xstrata Plc and Samancor Ltd, declared
force majeure on shipments from the country.
The impact of the South
African strike with our transport unions saw more than 50,000
workers not loading containers or bulk shipments of ferrochrome
and chromite sand, du Preez explained.
Striking transport workers were
then joined by workers from the state-owned power utility,
Eskom, later that same month.
Du Preez revealed: Foundries
were forced to use alternative minerals such as zirconium
silicate, olivine or rutile. The other option was to change the
processes and try to eliminate the use of chromite.
South African chromite supply looks
set to be boosted by a $50m. investment from US foundry
minerals producer, Amcol International.
As part of its investment Amcol is
building a new chromite processing facility at its Ruighoek
Chrome project in North West Province which, at the time of
press, is expected to be completed by early July 2010.
The facility, which will be the
supply base for Amcols new foundry chromite brand
Hevi-sand, will offer mine to customer
supply of customer-specified products with local onsite
customer technical support.
Our technology will allow us
to offer a tailor-made product to the foundries, offering
higher chrome contents, lower silicates levels and sized to the
foundries requirements, Amcols Joe Howden
told IM, adding that the current chromite
supply situation is, in most instances take it or leave
As Howden explained, historically
in developed countries foundries have tended to be clustered
into industrial centres which create identifiable focal points
for supply companies, raw material stocks and logistics trains,
allowing lower cost and just in time supply. With more
foundries being closed in developed countries and opening
elsewhere, industrial centres have been lost.
When this is coupled with
falling local demand, and many products and minerals being
imported from developing countries, just in time
and local stock holding has become more and more costly and
difficult to achieve, Howden commented.
The Ruighoek facility is part of
Amcols response to this problem. The group has numerous
subsidiaries and offices worldwide, which will allow it to
supply its own chromite from mine to customer, with technical
staff to support foundries at site.
Also looking to break into the
foundry minerals market is US company Oregon Resources Corp.
(ORC), a wholly owned subsidiary of Australian company
Industrial Minerals Corp. (IMC), which has been steadily
cultivating a heavy mineral sands deposit in Coos Bay, Oregon
The deposit hosts a suite of
minerals including foundry grades of chromite, high-iron
ilmenite, and zircon, but with a twist: the chromite will sold
as a premium chromite grade but also as a zircon
We see the opportunity to
introduce a differentiated product and value proposition to the
foundries that are looking to improve their end product quality
and save money by reducing the after-casting workroom cost and
rejects, IMC chief executive, Philip Garratt, told
Since our product is a
speciality sand our opportunity and initial focus is to
capitalise on the pricing of other speciality sands such as
bauxite, mullite and zircon, as our material will be a lower
cost substitute for these products, Garratt explained to
Breaking into an established market
as a new supplier poses problems of its own, although the
companys decision to market its chromite as speciality
sand will see it competing with more expensive products a
factor that should prove to be an advantage, if the product can
gain market acceptance.
As any marketer of a new and
innovative product will testify, changing the status quo is
often the most difficult challenge despite the improvements in
environmental performance and value proposition the new product
may offer, Garratt revealed. The foundry industry
has been doing it the same way for years with process changes
and/or product improvements taking several years to be tried
and ultimately adopted.
A significant part of the challenge
is building partnerships with established suppliers, certainly
something ORC has already achieved: US foundry supplier HA
International Inc. will be responsible for selling ORCs
chromite to North American markets, IGC Technologies LLC has
secured exclusive distribution rights for the high-iron
ilmenite, and German minerals trader Possehl Erzkontor GmbH
will be handling chromite sales to Europe.
HA International (HAI) CEO Keith
McLean told IM that part of the attraction to
the project was the untraditional nature of the
deposit: ORC chromite is a unique product. Its not
just a commodity and it has some very specific and valuable
attributes that the South African material
HAI is looking to sell the chromite
to two main markets: the conventional chromite market and the
realm of zircon replacement where the material will be a
lower cost alternative.
The natural market for this
chromite is North America; thats where its sourced
and thats where youll get the best economics,
McLean explained. Unfortunately I dont think
theres enough demand here to absorb the capacity of
ORCs plant, but well sell as much as we can to
Canada, the USA and Mexico.
One benefit of the ORC chromite is
its round grain shape, which allows producers to reduce the
amount of resin needed in the mold formulation. Using
less resin has implications for emissions and product price. If
you can cut your resin usage by 30-40%, along with that goes a
30-40% reduction in emissions. And emissions are a problem for
every foundry, everywhere in the world, McLean
One of the principal end uses for
graphite is in foundries, where the refractory mineral finds a
number of applications. Graphite is commonly used as a foundry
facing or mould wash, aiding the removal of cast metal after
the product has cooled. Similarly, graphite can be used to
lubricate extrusion dies before hot metal is reshaped. Owing to
its high carbon content graphite is frequently used in
foundries to raise the carbon content of hot metal.
For graphite, the recession was a
period of price instability and supply
disruption compounded in late 2009 and early 2010 by poor
weather conditions in China and the countrys government
placing further limitations on production, resulting in mine
closures (see The bright side of graphite).
Many products produced in
foundries are for the automotive market. This is why the
foundries have suffered along with the automotive producers.
Prices for steel and aluminium also made the situation even
worse, Thomas Junker, director of sales and marketing at
Germany-based graphite company, Graphit Kropfmhl AG, told
This year GK expects to increase
graphite sales to the foundry sector by up to 25%, bringing
them back to the sales volumes seen in 2008. The company is
currently developing graphite dispersions based on vein
graphite for foundries. These products are aimed at supporting
the flow of liquid metal, increasing form filling.
The challenge is to provide
high quality products at a competitive price level,
GKs Junker told IM. Supporting the
customer on site to optimise the use of the product and also to
develop tailor-made solutions often makes the
Prices for graphite are beginning
to recover to higher levels and are largely being accepted by
the market. In June, Austrian graphite miner Graphit Bergbau
increased prices for the first time in over three years in an
effort to pass on the increasing cost of production to
customers. After temporarily suspending production at its mine
a few years ago, the company had been supplying customers from
stockpiles and only within the past year has it resumed
Like in many other business
segments, the price of foundry grade graphite is controlled by
demand and availability, Junker commented. Until
now prices have been quite stable, but we see an increase
driven by producers in China. Also the weak euro combined with
rising freight costs makes graphite sold in Europe more
Exchange rates between the US
dollar and the euro may prove to have a negative impact on
graphite. Technografit GmbHs Dominik Georg Luh told
IM: In the short run there are
reasonable order books, but long-term forecasts might be
difficult as we are not sure about the impact of the current
USD/EUR exchange rate situation and the increased raw material
Both calcium and sodium bentonites
are used in foundry applications, with Na bentonite typically
used in more demanding, higher temperature applications.
Bentonite is used to bind together green sand grains used in
core mouldings, with around a fifth of bentonite produced used
in this application.
Like other foundry minerals
bentonite was affected by reduced demand in 2009, although its
use in this sector was fairly robust compared to demand from
its other end markets in oil and gas drilling and iron ore
Angelo Brodetto, from Italian
bentonite producer Laviosa Chimica Mineraria SpA, told
IM: The main world [castings]
producers such as China, India, and Brazil maintained
or slightly increased their volumes. [Meanwhile] during the
last year European foundry markets reduced their production by
Bentonite prices in the USA fell
last year but the trend in 2010 has been firming prices;
although these have largely been from increasing production
costs including mining, labour and packaging.
The onus appears to be on western
bentonite producers to provide reliable foundry mineral supply
at prices that are competitive to those offered by producers in
Consumers look to suppliers
to provide higher technological products at reasonable
prices, Brodetto explained. Suppliers have to adapt
their offers to this demand: offering value-added products and
reviewing their cost structures to compete with offers from
In the last 40 years around 70% of
foundry capacity in developed countries has closed, with new
capacity migrating to Asian countries and developing markets.
This movement in capacity has been driven primarily by
production costs, environmental concerns, and the introduction
of environmental, waste and energy taxation by Western
governments all of which have combined to make foundries
in developed countries uncompetitive.
To counter this trend, within the
past few years there has been a drive by foundries in developed
countries to focus on reclamation and reducing emissions:
From an environment compliance standpoint, a major
development has been the elimination of aromatic hydrocarbon
solvents in polyurethane systems, which are widely used in high
production environments, HAIs McLean told
One such inorganic sand-binding
system is Inotec, developed through a joint venture with
Ashland Inc. and German bentonite producer Sud-Chemie AG, which
is claimed to be emission-free. Inotec has been developed for
automotive casting production in collaboration with BMW
Groups light metal casting house in Landshut,
The real thrust longer term
is for wholly inorganic systems that use no organics at
all, McLean commented. These systems are out there,
but the issue is that organic systems have been developed to
perform so well, with such great economics and productivity,
that no company is willing to forego that and in most
cases cant afford to forego that to go to an
inorganic system thats inherently less productive and
As McLean explained, the cost
difference between organic systems and hybrid/inorganic systems
is largely controlled by the price of oil. Over the past five
years, the average premium a company encountered when moving to
use a biodiesel has been 10-15%. This is coupled with
productivity loss and the inability to reuse much of the
Captive automotive production
is the place where youll likely see an adoption of this
kind of [inorganic] technology, McLean told
IM. But the capital required to go to an
all-inorganic system is large, and it depends on the company
involved: doing the right thing is a form of value to
a group like BMW.
The technology is constantly
improving, however, and good headway has been made to improve
the productivity of inorganic systems; primarily through
adapting the core machinery used to shape sands.
But the fact remains: until
environmental legislation improves or the manufacturing
community can better the performance of inorganic systems,
there will be very few of them operating in the global
Global foundry markets were badly
affected last year, although some countries suffered more than
others. Industry sources estimate that the North American
castings sector reduced by 40-50% last year compared to
Fortunately North American
foundries have rebounded fairly dramatically, McLean
revealed. Surprisingly the rebound comes from the
strength of automotive casting. Carmakers are now manufacturing
at the same rate as theyre selling, so you dont
have these huge swings in inventories.
The European castings market has
started to recover, although it is understood that raw material
shortages combined with shifting old inventories are hampering
this somewhat. The good news for European foundries comes from
the product development area, where it is thought that German
automakers are reassessing iron blocks and moving away from
aluminium for smaller engines, which have higher compression
that is handled better by iron.
These blocks are more sophisticated
and their production if it increases will have good
implications for more technical minerals such as chromite and
In Europe and North America
foundries have benefitted from the fast growing market for wind
turbine blades. Particularly in the USA the wind turbine market
has developed over the past five years, from a market that was
almost nothing to a very promising growth area.
The wind power generation
market has been cutting a real boon over the last few
years, McLean commented. Its a lot of yield
and these are huge castings.
In countries where industrial development is
booming Brazil, China and India the expectation for
the future is growth. The only uncertainty regarding these
regions is how much the growth will be.
Selected new foundry mineral projects
|Amcol International Corp.
||North West Province, South Africa
||new chromite processing facility at Amcols
Ruighoek Chrome project will be the base for the
groups new Hevi-sand foundry chromite grade and
distribution service. The facility is part of a $50m.
investment, which includes the majority share purchase of
Bonmerci Investments 103 Pty Ltd itself in turn
the majority shareholder of Batlhako Mining Ltd, which
|Amcol Minerals Madencilik
||Enez Edirne, Turkey
||new subsidiary of Amcol Minerals Europe with 150,000
tpa bentonite capacity. Most attractive
markets for AMM include foundries and metal casting.
|Askania, North Cape Minerals
||following their merger in January 2010, Sibelco
subsidiaries Askania and North Cape Minerals have
invested $6.8m. in a new silica sand processing plant, to
be built in Spone where Askanias existing
warehouses are located. The project is scheduled for
completion in late 2010 or early 2011.
||Stellite, South Africa
||mining metallurgical grade but planning to produce
foundry and chemical grade chromite
|Cliffs Resources, KWG, Noront Resources, Spider
||Ring of Fire, Ontario, Canada
||the Ring of Fire area in northern Ontario has been a
hive of activity in the past few years, with much of the
attention focused on the Big Daddy chromite deposit
majority-owned by KWG and Spider, with Cliffs
holding 49%. In 2009 the US group successfully outbid
Noront to buy Freewest, giving Cliffs access to the
property. Recently it launched a bid for chromite junior
Spider. Regardless of who ultimately develops this area,
it contains significant reserves of metallurgical and
non-met chromite. Also promising is Noronts
neighbouring Blackbird deposit.
|Gulf Mining Materials Co.
||Wadi Mahram, Oman
||Omans first chromite processing plant, opened
by Gulf Mining in February 2010, with 15,000 tpa
capacity. Aiming to supply non-met grades for abrasive,
foundry and refractory uses.
||New South Wales and South Australia
||the worlds largest zircon miner, Iluka is
presently shifting its production base to two new
projects: Jacinth-Ambrosia in South Australia, and Murray
Basin 2 in New South Wales. The former is expected to
produce 300,000 tpa zircon, while the latter (brought
online in late 2009) is targeting 120,000 tpa.
||Limpopo, South Africa
||company owns three graphite deposits, including
Steamboat deposit which has a grade of 8.8% of 2mm
disseminated flake graphite. Targeting production by end
2010. If successful, Jonkel would be South Africas
sole graphite producer. Initial production would be small
(100 tpa purified graphite).
|Laviosa Sanayi ve Ticaret Ltd
||recent subsidiary of Italys Laviosa Chimica
Mineraria, the company has opened a new bentonite plant
in Fatsa which is currently targeting 50,000 tpa dried
granulated bentonite to initially supply cat litter,
paper and detergents markets. The company also plans to
produce milled grades for foundries in the future.
|Northern Graphite Corp. (formerly Industrial Minerals
||Bissett Creek, Ontario, Canada
||Northern Graphite owns a deposit of flake graphite in
Ontario, initially explored in 1989 but postponed when
graphite prices fell. Results from pre-feasibility study
conducted by SGS Canada expected in Q3 2010. Recently
raised $1.45m. through a private placement.
||chromite, high-Fe ilmenite, zircon
||Coos Bay, Oregon, USA
||developing five heavy mineral sands deposits in
Oregon which contain foundry grades of chromite,
high-iron ilmenite, and zircon, in addition to garnet
suitable for water jet cutting applications. Mine will be
operated similarly to a sand and gravel operation,
producing an average of 925,000 tpa for the first eight
years, and an average of 770,000 tpa for the 12 years
after that. Chromite sand to be principal product,
accounting for 64% of products by volume. See p.45 for an
interview with parent company Industrial Minerals
Foundry minerals at a glance
Silica sand is the
principal foundry moulding material owing to its widespread
availability and low cost. Fine, naturally bonded sands have
traditionally been used in the casting of aluminium, light
copper alloys, and light grey iron. Heavier, naturally bonded
sands are used in the molding of large iron castings.
Applications for all naturally bonded products have declined in
favour of blends of washed sands, bentonites and other binders
and additives, owing to better control and customisation of
product characteristics. Pricing: $18-20/tonne
for Vietnam material, FOB DaNanag.
Chromite sand has
been used in foundries for over 50 years and has steadily
expanded its end market from manganese steel castings to a wide
range of ferrous and non-ferrous castings, and is commonly used
to face large castings or thick sections. Improvements in
product quality and consistency and the incompatibility of
olivine with many synthetic binder systems have boosted
chromites market penetration. Pricing:
$310-360/tonne for South African material, wet bulk, FOB
Olivine sand is
widely used in the casting of manganese steels due to its
basicity. The magnesium content of the olivine enhances its
bonding characteristics when used with clays, reducing
bentonite usage. It is also used in the production of castings
(particularly non-ferrous) that require a fine surface finish
as well as in core manufacturing. Olivine has faced competition
from chromite sands as producers have improved the quality of
their foundry grades and have benefited from olivines
incompatibility with acid-cured binders.
Pricing: $60-90/tonne for US material
(refractory grade), ex-mine.
Zircon sand is a
niche product that is capable of withstanding long exposure to
the highest casting temperatures typically between
1,550-1,650¡C for certain low alloy and low carbon
steels. Its unique characteristics (such as refractoriness, low
linear thermal expansion, and chemical stability) make it an
ideal non-silica foundry sand. But high prices mean it is
usually reserved for the most specialised applications; such as
facings for heavy iron and steel castings poured at high
temperatures, as mold paints or washes to improve surface
quality, high definition cores, and shell casting and
$825-860/tonne for Australian material, standard, bulk,
Other lesser-used sands include:
andalusite, bauxite, ilmenite, kyanite, mullite, perlite,
sillimanite, fused silica and staurolite.
Bentonite has good
bonding characteristics and fast green strength, good hot
strength, high gel formation and low permeability. It is used
to bind green sands (such as olivine) together during foundry
molding and metal casting. Both calcium and sodium bentonites
are used in foundry applications, although Na bentonite is more
stable at high temperatures such as those encountered
during casting of steel, ductile iron, and medium-heavy grey
iron. Ca bentonite is more commonly used for detailed intricate
castings, usually with grey iron, ductile iron, and non-ferrous
alloys. Pricing: $90-115/tonne for US
material, bagged, ex-works Wyoming, railcar.
traditionally used in core and mold washings and foundry
ladles. Low quality flake graphite or amorphous flake graphite
can be mixed with other refractory minerals and shaped to form
crucibles, molds and ladles for multiple metal types. Finely
ground flake graphite or amorphous graphite can also be used
with other minerals to form foundry facing or coating for
molds creating a smooth finish on castings.
Pricing: $700-900/tonne, CIF European port,
FCL Crystalline medium, 85-87%C, +100-80 mesh.
Other additives include alumina (fused and white fused),
gilsonite, kaolin and mica.
Source: Iluka Resources Plc
Source: Industrial Minerals HandyBook,
Oregon Resources: a new
source of foundry minerals
IM talked to
Philip Garratt, CEO of Australias
Industrial Minerals Corp. the parent company of Coos
Bays heavy mineral sands developer, Oregon
Resources about its progress at the US-based project and
the flagship product of the heavy minerals mix: chromite.
Philip Garratt, CEO of Industrial Minerals Corp.
IM: What stage are you at with the Coos Bay
PG: We have commenced the construction of the main
processing facility and expect foundation formwork to be
completed by mid-June 2010. The construction of the wet and dry
mill and all related components is scheduled for completion in
We have just undertaken a drilling
programme on recently acquired leases and we expect assay
results will be available by late September 2010. The areas
drilled are contiguous to our existing resource and I expect to
see assay results comparable to the surrounding leases. We are
hopeful that by the current year-end we will be able to
demonstrate a resource sufficient for a minimum 20-year mine
IM: Who are the main partners involved in the project?
PG: We have a close working relationship with the
minerals division of Weyerhaeuser Corp. [US timber company] and
they are the principal landowner and benefit through royalty
and lease payments. The main project owners are Macquarie Bank
Metals and Minerals division and The Sentient Group. Together
they own approximately 45% of the fully diluted capital of
Industrial Minerals Corp. which is the 100% owner of Oregon
HA International, IGC Technologies,
and Possehl Erzkontor are our primary collaborators in the
project and we appreciate their involvement at various levels
of the business.
IM: When do you expect to begin mining and what are your short-
to medium-term plans for the site?
PG: Mining will commence early in the fourth quarter
 to provide feed for the start-up and commissioning of
the wet plant later, in the same period. The mining plan
involves the removal of surface material and extraction by
front end loaders of ore onto trucks for transportation to the
There are multiple contiguous
deposits and the time taken for extraction of the valuable
heavy minerals varies per deposit. The surface area operated on
at any one time is approximately 5 acres with extraction from
2.5 acres, while contemporaneous reclamation is undertaken on
the recently mined 2.5 acres. The land is reclaimed in
accordance with the requirements of the land owners;
principally Weyerhaeuser Corp.
IM: Which regions are you targeting for sales of chromite,
high-iron ilmenite and zircon?
PG: Chromite will be sold into the North American and
international markets; approximately 40% into North and South
America, 40% into Asia, and the balance to Europe. The
high-iron sales will all be to IGC Technologies LLC, while 100%
of zirc on sales will be into the USA.
IM: What are the main properties of Coos Bay chromite?
How does it differ to other chromite sands?
PG: ORCs chromite was deposited
in ancient beach terraces which have since been uplifted to
their present level. Due to the oceans wave action, these
mineral particles have been rounded, polished, separated by
specific gravity and classified into a very consistent, narrow,
two sieve size distribution, with an 85 to 90 AFS grain
A common or typical chromite sand
is crushed from agglomerated grains and chromite ore. The
resulting crushed sand will be angular, due to the crushing and
the crystalline structure of the chromite mineral, and it will
be a four sieve distribution with an AFS grain fineness of 48
Foundrymen are used to the wider,
four sieve distribution and are usually nervous about using a
narrow distribution sand, because they feel the wider
distribution will allow the finer grains to fill the voids
between the coarse grains and provide a better casting
However, ORCs sand has a
rounded grain shape and narrow particle size distribution,
which allows the rounded grains to pack together tightly;
providing increased grain-to-grain contact and therefore
increasing the contact points for the binder to form more
binder bridges, with more adjacent grains. Due to these
properties we have observed higher tensile strength for the
cores, improved heat transfer and an improved casting
Additionally, the clay content of
ORCs chromite is half that of South African chromite
sand. Crucially, a high clay content can cause the binder
bridges between sand grains to fail. This occurs when the
binder bridge between the sand grains is stronger than the bond
to the sands surface. Adhesion failure results from the
binder peeling away from the surface of the sand grains, and is
typically caused due to a coating on the surface of the
sand such as clay that impedes the ability of the
binder to adhere to the sands surface.
If the surface of the ORC chromite
is not clean, the electrostatic separators, low intensity
magnets and rare earth magnets will not be able to effectively
separate the various minerals, meaning the product would fail
all of the established quality testing parameters and the sand
would have to be discarded or reprocessed. So binder bridge
failure due to an unwanted coating on the sand grains is not a
factor for ORC chromite.
IM: What are ORCs challenges and opportunities in the
PG: Challenges that we faced as we looked to position
as a new supplier to this market ranged from establishing
relationships with customers, through to logistical issues.
These have been significantly addressed by the creation of
working relationships and partnerships with several well
established and respected foundry supply businesses. Since our
product is a speciality sand our opportunity and initial focus
is to capitalise on the pricing of other speciality sands such
as bauxite, mullite and zircon, as our material will be a lower
cost substitute for these products. The opportunity for zircon
substitution in foundries is mainly outside Europe as European
foundries experienced pricing and supply challenges earlier in
the decade and migrated to readily available cheaper
We see the opportunity to introduce
a differentiated product and value proposition to the foundries
that are looking to improve their end product quality and save
money by reducing the after-casting workroom cost and rejects.
We see the potential to collaborate with existing producers of
conventional foundry chromite sand and introduce new exclusive
blended product lines. We have created castings with blended
material and documented the improved performance
characteristics and shake-out. We see potential to introduce
unique blended chromite products to the market in the future
and would expect demand to be stimulated post the introduction
of our premium grade offering.
I believe foundries will need to become much more efficient-
and quality-oriented in [developing] regions and will not be
able to afford the time and money currently wasted on scrapped
castings as well as labour in the workroom rectifying casting
defects. I expect it will take some time for change to occur,
as the misconception is that a $1 saving on casting sand is $1
saved. In fact, buying quality casting sand can reduce the
percentage of scrapped castings and time taken trying to clean
up and grind a casting to meet customer expectation.