\ 1
:
Ductile iron Cupola
Hot metal
Pouring
B
b
Return sand Electric arc
Cores
Spill sand
Sand eparation
h s t
Cote
I I
Impact of foundry pollution Bernard S. Gutow A . T. Kearney, Inc. Chicago, Ill. 60606
Within the next 10 years, control expenditures could result in one third of U.S. iron foundries closing their doors and the eventual layoff of 26,000 employees
790
Environmental Science & Technology
T
he iron foundry industry is defined as those shops that melt iron in furnaces, pour it into molds, and alloy and/or treat the iron in either the molten or cast state. Foundry processes are limited to making gray, malleable, and ductile iron castings. The industry is composed of some 1635 foundries (in 1971) of which 7 1 z were small, less than 100 employees; 2 5 x medium, between 100 and 500 employees; and only 4 large, over 500 employees. Foundries are widely distributed and are located in almost every state with half of them in the Great Lakes states. Approximately 25 of all iron foundries are captive (the remainder being independent), largely producing jobbing type castings. Most foundries are relatively old, although many have been modernized by installing new equipment. Many of the small foundries are marginal oper-
ations with old or obsolete equipment and facilities. Melting is still principally accomplished by cupolas (vertical cylindrical furnaces), ,but output from electric arc and induction furnaces is increasing in importance and tonnage. The principal environmental problem of the iron foundry industry is air pollution caused largely by melting operations. Air pollution from nonmelting operations is more easily controlled, and emissions are considered to be more of a n in-plant environmental problem than an air pollution problem. Water pollution results principally from wet scrubbers installed o n cupolas for air pollution control and from slag quenching on cupolas. Production
Iron castings production has varied widely during the past 10 years, from 10 million to 15 million tons per year.
Shipping 1
feature U
Finishing
Core sand and binder
control Although yearly figures have fluctuated, the general trend has been moderately upward, with a continuing growth projected at 2 wt %/year. Malleable iron output has remained at about one million tons per year, while ductile iron production has shown steady growth and now exceeds malleable production. Principal production categories include cast iron pipe and fittingsrepresenting 23 % of product cast; ingot molds, 11 and miscellaneous castings, 66%:. However, only 65 foundries produce pipe and molds, resulting in 4 % of the foundries producing 34% of the tonnage. The miscellaneous iron castings category includes all malleable and most of the ductile iron output as well as gray iron castings. Principal users are automotive and agricultural equipment industries, which when combined, account for over 3 3 z of all castings produced
z;
(Table 1). Only 66% of the iron casting production is accounted for by 30 major industries, with over 2.5 million tons per year distributed among all other industries. Markets for iron castings have been projected to increase to approximately 17 million tons per year by 1980. The only area in which competition from other products is expected to be a major consideration is in cast iron pressure and soil pipe. Export markets for iron castings are expected to diminish, and imports are expected to increase. However, these represent only a minor factor in the total market. Iron foundry production processes can be divided into two broad categories: melting and nonmelting. Melting operations involve cupolas, electric arc, induction, and reverberatory furnaces. These account for the more important pollution control problems in the iron foundry (see flow diagram). Nonmelting operations include molding, pouring, shakeout, sand preparation, cleaning, finishing, and coremaking. Emissions from these operations are more easily controlled with lower cost, readily available equipment. Iron foundry population has declined steadily from 3200 in 1947, to 1635 in 1971, and is projected to continue declining to about 1000 by 1980. The foundries that have closed, or are expected to close in the next decade, are primarily the small ones without the capital to modernize and mechanize. The necessity for large capital expenditures for pollution control has been a contributing factor, but has not been the principal reason for the closures. Despite the reduction in the number of operating foundries over the past years and the projected continuance of that trend through 1980, the industry will continue to meet the demand for iron castings. Since the average iron castings production per foundry has increased offsetting the loss in founary population, about 16,500 tons per year will be produced by 1980. With the exception of pipe and ingot mold foundries, the vast majority of iron foundries produce
a variety of iron castings, mostly on a jobbing basis. Total employment was about 230,000 in 1968, with average labor input being 23 man-hr per ton of castings. Although almost all levels of skills are utilized in iron foundries, most of the production labor can be classified as unskilled or semiskilled. Emission control
Emission control costs, measured against such factors as sales, total assets, and cost per ton of castings, generally show a declining percentage as foundry size increases. Therefore, a greater emission control burden is placed on the smaller foundries, which also accounts for their inability to cope with this cost. The effect of environmental control on cost of castings varies widely from more than $14 per ton for the smallest foundries to under $2 per ton for the largest foundries. Except for the smallest foundries, these cost increases are not a significantly high percentage of the casting cost. However, the profit structure of the industry is not sufficiently strong enough to absorb this added cost. As a result, the cost will have to be passed o n to the castings customers as a price increase. Since the entire industry is faced with the same problem, price movements may have a negligible effect in shifting demand between foundries. However, it will probably result in some losses to competitive materials in pipe products and to imported castings. Technological changes taking place in the iron foundry industry involve almost every area of activity, but are concentrated primarily in three general directions: melting, mechanization and automation, and pollution and environmental control. Although the first two result in lower labor costs and higher productivity, the high capital costs involved in all areas have accelerated the rate of closing of small foundries. The effect of government influence, both federal and local, on iron castings purchase is minimal, since very few iron castings are bought directly by governments. The one exception is cast Volume 6, Number 9, September 1972
791
TABLE 1
Distribution of miscellaneous iron castings 1967 Distrlbution Tons x 1000 %
Industry user
Motor vehicle parts and accessories Farm machinery Motor vehicles Internal combustio Construction mach Enameled sanitary ware (1965) Heating equipment (1965) Valves and pipe fittings Pumps and compressors Cooking utensils ( Refrigeration mac Power transmission equipment Railroad and street cars Motors and generato Miscellaneous machi electrical Note: Does not inclu Source: Department
iron pipe, where government specifications and cost control tend to promote lower cost, competitive products. Price increases of $2 to $14 per ton, caused by the need to recover costs of installing and operating pollution controls in iron foundries, will have some effect in promoting the use of competitive products and materials over iron castings, particularly in pressure and soil pipe. It will also, at least temporarily, adversely affect the foreign balance of trade by reducing exports and increasing import of iron castings. Export markets, however, represent a minor factor in the total market. Competition within the iron foundry industry will be affected to only a limited degree since all foundries are faced with the same need for installing pollution controls. However, the need for higher increases, $14 per ton or more, among the very small foundries will undoubtedly adversely affect their competitive positions and will result in increased closings among small shops. Foundry closings
The rate of closing of small foundries, undiminished for the past 25 years, is expected to continue at least for the next 10 years. The reasons have been economic-principally the need for 792 Environmental Science & Technologj
2593
27.4
558
5.9
505 295 247 207 199 165 160 144 140 132 106 104 91
5.3 3.1 2.6 2.2 2.1 1.7 1.7 1.5 1.5 1.4 1.1 1.1 1.0
75
0.8
Industry user
Printing trades machinery Hardware Textile machinery Industrial trucks and tractors Household laundry equipment Special industry machinery Machine toots-metal forming Special dies, tools, jigs, and fixtures Paper industries machinery Ball and roller bearings General industrial machinery Food products machinery Woodworking machinery Metalworking machinery All other Total
1967 Distribution Tons x 1000 %
67
55 55 51 47 44 44 40 29 24 22 20 20 19 3212 9470
0.7 0.6 0.6 0.5
0.5 0.5 0.5 0.4 0.3 0.3 0.2 0.2 0.2 0.2 33.9 100.0
r ingot molds.
eau of the Census, 1967 Census of Manufactures.
capital expenditures to replace equipment, reduce labor costs, and increase productivity. The added need for highcost pollution controls, which yield no return on investment and, in fact, actually increase operating costs, has accelerated the rate of closing of smaller and marginal foundries. The number of foundries having fewer than 20 employees that manage to survive until 1980 will be very small, probably under 100, compared with over 700 only 10 years ago. Older foundries, and those still operated manually, will also experience a high percentage of closures. Since foundries expected to close are primarily small ones with low capacity, the total displaced tonnage is not expected to be great in relation to total available capacity. Principal problems will be that as the very small jobbing foundries disappear, there will be few foundries left that will be willing to take small orders for one or two special castings. Most foundries obtain their metallic and nonmetallic raw materials from suppliers and dealers located in their general areas. These in turn get their materials from steel plants, refractory firms, quarries, and similar companies. The principal exceptions are the scrap dealers located in every community
who buy local scrap, process it, and sell it to foundries. Since the total foundry tonnage is expected to continue to grow, the closing down of individual fo~indriesis not expected to have any national effect on suppliers. Local dealers and supply firms may be affected if the only foundry in an area closes down, but most will continue to supply the same materials to other foundries in the area. The net effect of the continuing decrease in the number of iron foundries, while the total casting tonnage has continued to grow, has been to increase the average output per foundry from 3S00 tons per year in 1947 to 8700 tons in 1969. This is projected to be 16,500 tons in 1980, and further illustrates the rapid disappearance of the small foundries. Since pollution control costs result in price increases, products such as pipe and molds, which are sold as finished products directly to consumers, will experience a direct increase in the cost of final products. However, for most jobbing castings, which constitute only a small percentage of the weight of the product in which they are used, the overall effect on the final product cost is relatively minor. For example, the cost of the average automobile has been
estimated to increase about 50 cents owing to the installation of pollution control equipment in iron foundries. Employment effects
The principal effect of the closing of foundries is expected t o be on local employment and' to a lesser degree on national employment. An estimated distribution of foundry closures has been made, resulting in a state-by-state analysis of the efect on employment (Table2). The total number of employees estimated t o be dislocated by foundries projected t o close in the next 10 years is 26,630, or about 11% of total foundry employment. Approximately half or their equivalent will be reemployed in other iron foundries, which will increase their business by picking up that given up by the closed foundries. Net unemployment is therefore estimated t o be approximately 13,300. However, many of these foundries are expected t o close for reasons other than the need
for installing pollution controls. Pollution control will only accelerate the rate of closings. Approximately 2266 of the 13,300 foundry workers estimated to be unemployed a s a result of foundry closings through 1980 will possess skills directly transferrable t o other industries. If local demand for these skills exists a t the time o f a foundry closing, these workers will be absorbed into other industries. However, the majority of foundry workers are semiskilled or unskilled which creates a need for retraining and, in some cases, relocation t o new areas. Expenditures for air pollution control in iron foundries are estimated a t $24 million in 1972, increasing annually t o $131 million in 1975, after which controls are assumed t o have been largely installed and annual expenditures will drop off. The major problem facing foundries has been identified as raising capital funds for installing controls. It represents a problem of financing nonproductive expense in an industry with earnings always marginal.
TABLE 2
State
EmFoun- Foundry ployee dry distri- ~ 1 0 5 - dislocabution ines tions
65 -
3
23 -
1,025 -
-
-
9 86 15 28 1 -
4 41 6 12 -
40 1,585 265 595
16
9 16
165 415 -
31
1 3 104 79 38 24 11 11 8 11 51 122 35 7 26
2 35 27 14 13 5 7 5
1 25 48 20 5 13
-
20 1,820 1,190 740 425 165 120 140 75 1,065 1,950 775 115 475
State
Foun- FounEmdry ployee dry distri- clos- dislocabution in95 tions
___
2 7 1 9 44 85 29 3 164 18 14 166 10 15 1 43 59 12 8 33 21 13 93
-
-
2 -
85 -
4 18 -
65 565
36 1 59 9 8 63 3 9
1,315 465 10 2,745 420 170 2,865 120 205
17 31 5 3 18 12 6 33
745 920 190 95 600 195 150 1.540
16
-
- -
-
-
-
,
,,%
Special inducements may have t o be provided by various levels of government t o assist and encourage foundries t o make the necessary expenditures rather than closing their doors. Of the many alternatives considered, those which are most likely t o be successful have been identified as subsidies or grants covering large portions o f the capital investment for pollution control, and/or large direct offset charges against income taxes. Because iron castings output is expected t o continue to grow, even though many iron foundries will close, the overall effect on the industry will not be as catastrophic as might otherwise be expected. Raw materials will continue t o be required in undiminished quantities, and castings customers will continue t o be supplied in spite of some local inconveniences. Even the unemployment, created by closing of many small foundries, will be compensated for partially by the need for many surviving foundries t o expand t o pick up the displaced castings tonnage. . The widespread distribution of iron foundries, and the location of foundries in almost every community, are expected t o create a local, rather than a national, problem. This will be true particularly where a small foundry is practically the only industry in a community. I n these cases, attraction of new industry or.relocation of some workers to other communities will be necessary. With the possible exception o f some scrap yards serving isolated communities where a foundry closes, the effect of iron foundry closures on supplier industries in most areas is expected t o be very minor. Volume 6 , Number 9, Scplember 1972 793
