The problems of establishing a new foundry in Kazakhstan utilizing Lost-foam casting technology are discussed in this article. The study’s main objectives are to determine the technical and financial viability of arranging such production in the country. Calculations of the manufacturing program were carried out as part of the study, and a financial- economic model of the project was developed. The research shows that establishing such a foundry is feasible, and the project may be recommended for execution

Latypova, M.

Petrovskaya, A.

Romazanov, Zh.

Silayeva, O.

Tatieva, M.

English

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103METALURGIJA 62 (2023) 1, 103-106ZH. ROMAZANOV, O. SILAYEVA, M. TATIEVA,  M. LATYPOVA, A. PETROVSKAYATHE FEASIBILITY STUDY FOR THE CREATION OF PRODUCTION BASED ON TECHNOLOGY OF LOST-FOAM CASTINGReceived – Primljeno: 2022-06-09Accepted – Prihvaćeno: 2022-08-20Preliminary Note – Prethodno priopćenjeThe problems of establishing a new foundry in Kazakhstan utilizing Lost-foam casting technology are discussed in this article. The study’s main objectives are to determine the technical and financial viability of arranging such pro-duction in the country. Calculations of the manufacturing program were carried out as part of the study, and a finan-cial-economic model of the project was developed. The research shows that establishing such a foundry is feasible, and the project may be recommended for execution.Keywords: foundry, lost-foam casting, investments, technology, financial modeling.ISSN 0543-5846METABK 62(1) 103-106 (2023)UDC – UDK 621.746:621.74.04:658.92.14:338.314=111INTRODUCTIONCastings have a high design precision and practical correspondence to the shapes of the parts. The total en-ergy intensity of billet casting is half that of other tech-nologies. Cast products have relatively low production costs. Foundry production retains leadership among similar industries in the automotive, oil and gas, nuclear industries, as well as in hydraulic engineering, mechan-ical engineering, pump engineering and etc.In Kazakhstan, foundry shops were created at the plants of medium machine building and the mining and metallurgical complex. The absence of market mecha-nisms for the development of the industry did not con-tribute to the implementation of new technologies with higher labor efficiency, and also did not allow obtaining high-quality castings and reducing costs. Therefore, in recent years, the foundry business has become attrac-tive for investment.Today, there are 15 foundries in the country [1], of which only 3 have switched to new casting technolo-gies, whereas the rest are still using outdated sand cast-ing technology. Due to the low quality of manufactured foundry products, Kazakhstan imports up to 90 % of its needs from abroad [2]. Regarding the volume of con-sumption of teeth and crowns for the teeth of excavator buckets, the demand of the country’s mining enterprises is estimated at no less than 2-2,5 thousand tons per year or 13-15 million US dollars.In Kazakhstan, cast iron castings for mechanical en-gineering account for a small proportion of the total vol-ume of cast blanks compared, for example, with Russia Zh. Romazanov, O. Silayeva, M. Tatieva, M. Latypova, A. Petrovskaya, Department of Economics and Business, Karaganda Industrial Univer-sity, Temirtau, 101400, Republic of Kazakhstan.Corresponding author: rzhanat@mail.ruand EU countries. At the same time, the production of cast iron balls, single, small- and medium-scale steel casting dominates in the industry [3].The volumes of metal casting in Kazakhstan in 2016-2020 are shown in Table 1 [3-4]. Hence, despite the crisis -triggered by the pandemic, there has been a 2,0 times increase in the volume of casting by a cost from 18,7 to 37,9 million US dollars, in physical terms – a 1,2 times increase from 42,7 to 49,4 thousand tons.Table 1 Metal casting in KazakhstanIndicator 2016 2018 2020Metal casting / mln USD 18,7 33,7 37,9Iron casting / tons 19 211 32 646 21 462Steel casting / tons 23 181 35 982 27 385Non-ferrous metals/ tons 326 1 308 573Metal casting, total / tons 42 718 69 936 49 420At present, there is a need in Kazakhstan to create efficient foundries aimed at producing high-quality shaped casting for mining, machine engineering, rail-way and other industries. The creation of a foundry based on advanced methods of smelting and processing of cast iron and steel using the LFC (Lost Foam Cast) technology is characterized by low costs, high product quality and allows the manufacturer to have a profitable business. The article by V. Doroshenko [5] indicates that the share of LFC technology makes up about 1,5 % of the global production of foundry products.TECHNOLOGICAL ADVANTAGES  OF THE PROPOSED PROJECTLost-foam casting (LFC) is the process of producing cast products using models made of expanded polysty-rene, vacuum flasks and unbound quartz sand. When 104  METALURGIJA 62 (2023) 1, 103-106ZH. ROMAZANOV et al.: THE FEASIBILITY STUDY FOR THE CREATION OF PRODUCTION…filling the flask, the expanded polystyrene models are gasified by the heat from the liquid metal, and the emp-ty space formed is filled with a hot alloy. The creation of a solid frame in the process of vacuuming sand al-lows the manufacturer to maintain the shape of the model and ensure high quality of the casting surface. After the metal cools down, removing the vacuum leads to softening of the molding material and eliminates the appearance of shrinkage defects in castings.Lost-foam casting technology is used for the pro-duction of conventional and wear-resistant cast iron grades, any steel grades (from carbon to high-alloy, heat-resistant, ovenproof alloys), foundry bronzes, brasses and siluanes. Using this method facilitates man-ufacturing castings of different weights (from several grams to several tons) with a surface purity of Rz40 and dimensional accuracy up to Class 7 according to GOST 26645-85 [6].In the work of O. Shinsky [7] it is stated that in LFC technology the use of molding materials, rods and their mixtures, conventional sets of models and metal molds is not necessary. The exclusion of the process of manual assembly of sand and metal molds and its elements leads to an increase in the dimensional accuracy of cast-ings to the level of Class 7-9, and up to 12,5-25,0 mi-crons in the surface roughness. This simplifies casting processing operations (by 70-80 %), increases the yield of usable (up to 85-95 %) and reduces the consumption of metal, electricity and charge materials.In the work of V. Shulyak [8], a foundry with the Lost-foam casting technology involves technological operations such as:• production of models from expanded polysty-rene;• creation of model blocks coated with non-stick painting;• molding of model blocks into flasks on a vibrat-ing table;• feeding of flasks to the filling area;• pouring metal into flasks under vacuum;• cooling, cutting, stripping castings;• heat treatment.The LFC casting shop differs from foundries using sand molds by its structure, technological process and equipment, material and energy supply, specialization and the number of staff.The main alternative technologies for the production of large and medium-sized castings are sand-clay molds (SCM), vacuum-film molding (VFM, V-process), cast-ing in cold-hardening mixtures (CHM) and lost-foam casting (LFC).The technical advantages of the LFC [9] in compari-son with analogues include such as follows:• the use of relatively simple and cheap equipment;• the reduction of consumables costs (sand con-sumption – 0,5-1 %), which significantly reduces the removal of industrial waste to landfills;• a 10-20 % reduction in the consumption of alloys for casting due to the reduction in profits and al-lowances;• the reduction of costs for thermal and mechanical processing of castings (due to the reduction of gate systems and casting allowances), while the machining time is reduced by almost 30-40 %;• achieving higher accuracy in flatness, in facets and geometric dimensions of castings, which guarantees smaller allowances for machining and accurate production of markings and shapes;• obtaining a high-quality surface of castings, when the surface roughness of steel castings can reach up to 100 microns, for other castings - RZ-70 and more;• a 2-5 % decrease in the number of deficiencies;• the reduction of the number of production opera-tions and equipment for the final processing of castings;• the increase of the level and complexity of auto-mation of technological processes;• reduction of the shop area by 3-4 times due to the exclusion of the equipment of the core, molding and mixing areas;• reduction of qualification requirements for main and auxiliary production personnel;• the increase in the environmental friendliness of production, due to the reduction of pollution of the production areas of the foundry, as well as the reduction of waste of the foundry mixture. In turn, working conditions are improving.According to V. Shulyak [8], the economic advan-tages of the LFC process include such as follows:• the increase of 68-87 % of the yield of suitable castings;• the reduction of the mass of castings by 10-20 %;• reduction of ferroalloys and charge materials con-sumption by 15-25 %;• the 30-90 % reduction in the consumption of molding materials and rods;• the 80-90 % reduction in labor costs at the mold-ing site;• the reduction in single production by 10-20 % and in serial production by 40-60 % of labor costs in finishing operations.The LFC technology leads to a significant reduction in machining costs during the manufacture of complex castings made of wear-resistant steels (teeth, armor Table 2  Comparison of quality indicators of different casting methods / %Production methodCost of toolingCasting metal densityTooling durabilitySurface roughnessSCM 38 81 38 100Pressure die  casting88 88 12 82LFC 82 100 100 42Injection molding 100 35 18 30105ZH. ROMAZANOV et al.: THE FEASIBILITY STUDY FOR THE CREATION OF PRODUCTION…METALURGIJA 62 (2023) 1, 103-106crushers and parts of excavator tracks). In addition, in-vestments in fixed assets when creating LFC production are 2-2,5 times less as compared to sand casting.Y. Stepanova [10] in her work provides a compari-son of the quality indicators of 4 casting technologies in mass production based on the analysis of data from various manufacturers of the American company called “Robinson Foundry” (Table 2).DETERMINATION OF THE PRODUCT RANGE FOR THE PROJECTThe LFC method is used for manufacturing of dif-ferent grades of cast iron and steel castings. It is possi-ble to identify the most suitable brands in order to launch the production in Kazakhstan. Primarily, those, which are in great demand, standardized and well estab-lished in the market.Low-alloy, low– and medium-carbon steels. These include steels for casting of machine parts, which are subject to the requirements of increased strength and high wear resistance, and able to operate under the in-fluence of static and dynamic loads. They are primarily used for the manufacture of wheelgears, gears, rollers, etc. The LFC technology makes it possible to reduce the consumption of liquid metal and minimizes the surface treatment of the end castings, and, in some cases, allows the manufacturer to obtain castings that do not require additional processing.High-alloy steels, including 110G13L (Gadfield steel). Gadfield steel has a high wear resistance when exposed to high pressures or shock loads at the same time. The peculiarity of this steel is that it is strongly riveted (hardened under shock loads) up to HB 600 [11]. It is widely used in machine parts, mainly in the mining industry, which are subject to shock loads and abrasion. It is used for the manufacture of excavator tracks, bucket teeth, ladles, etc. Castings are usually not subject to additional processing, as they are difficult to be proccessed by cutting. The use of the LFC technol-ogy makes it possible to obtain castings that do not re-quire additional processing, which is impossible when casting into sand-clay molds. This enables the manufac-turer to significantly expand the assortment list of the enterprise in terms of casting from 110G13L.Grey and high-alloyed white cast iron and inter-eu-tectoid alloys. Alloyed cast iron is 5 times more durable than carbon steel, and 110G13L steel is 2 times more durable and is used for manufacturing parts, able to op-erate under conditions of abrasive wear at medium im-pact loads [12]. They are mainly used for lining mills and crushers. Casting of these alloys into sand-clay molds is associated with serious technological difficul-ties, especially for castings of complex shapes. As a re-sult, the market has set a high price for products made of this material. Technological limitations are removed by the use of the LFC technology. At a cost comparable to 110G13L, this gives a large profit per unit of a prod-uct made of high-alloy cast iron.Within the framework of the project, it is proposed to organize the production of castings and cast products from low- and high-alloy, low- and medium-carbon steels (grades ST35, ST45, ST55, ST80GSL, ST 110G13L), as well as from gray and high-alloy white cast iron (grades ICH300H18G3, SCH15) and between eutectoid alloys.THE ASSESSMENT OF ECONOMIC EFFICIENCY OF THE PROJECTThe organization of such a foundry requires attract-ing investments in the amount of 8,8 million US dollars (Table 3), which will be both of a capital nature (84,3 %) and used to ensure the company’s activities with working capital (15,7 %).Based on the results of comparisons of alternative options, it is proposed to place the project in the special economic zone “Saryarka” (Karaganda region).Table 3 Investment plan of the projectName Cost / $Design and pre-design work 190 400Construction and installation works 3 156 720Equipment installation and supply, including: 1 623 985technological equipment 891 418auxiliary equipment, snap-in and inventory 732 567Trial operation and attainment of projected capacity 3 808 000TOTAL investments 8 779 105Table 4 Production program / tType of casting Year 1 Year 2 Year 3ST 35 1 493,3 1 702,4 995,580 GSL 1 493,3 1 702,4 995,5110G13L 2 210,1 4 031,9 5 176,8ICH 465,9 913,9 1 672,5SC15, 25 310,6 609,3 1 115,0Total 5 973,2 8 959,8 9 955,4The planned capacity of the proposed production in-volves the production of 9 955,4 tons per year of found-ry products (Table 4), including steel (7 167,9 tons) and iron (2 787,5 tons) casting. The annual production vol-ume will amount to 9,2 million US dollars when reach-ing the planned capacity.The company’s staffing requirements - 100 people.The cumulative net present value (NPV) for a 5-year period will account for about 1 million US dollars and is sufficient to fully cover discounted investments. The discounted internal rate of return (IRR) is 18,9 %. The simple payback period (PBP) of the project is 4,4 years, and the discounted payback period (DPBP) is 5,6 years.The net income for the project is formed from the first year (the time of production launch) in the amount of 0,6 million US dollars and will amount to 33,6 mil-106  METALURGIJA 62 (2023) 1, 103-106ZH. ROMAZANOV et al.: THE FEASIBILITY STUDY FOR THE CREATION OF PRODUCTION…lion US dollars at the end of the 5-year period (Table 5). The profitability of production is expected to average 30 %.REFERENCES[1] Statistical business register according to the code GSTEA 245 «Casting of metals» 2021. Portal of the Bureau of Na-tional Statistics of the Agency for Strategic Planning and Reforms of the Republic of Kazakhstan. https://stat.gov.kz/jur-search/ filter.[2] Statistics of foreign and mutual trade of the Republic of Kazakhstan for 2016-2020. Portal of the State Revenue Committee of the Ministry of Finance of the Republic of Kazakhstan. https://kgd.gov.kz/ru/exp_trade_files.[3] Industry of the Republic of Kazakhstan for 2016-2020. Statistical collection. Nur-Sultan, 2021, 169.[4] The main indicators of the work of the Kazakhstani indust-ry. Operational data for 2016-2020. Portal of the Bureau of National Statistics of the Agency for Strategic Planning and Reforms of the Republic of Kazakhstan. https://stat.gov.kz/official/industry/151/statistic/7.[5] V. Doroshenko. Metal casting by foam models (2007). Portal RB.RU. https://rb.ru/article/lite-metalla-po-peno-modelyam/4857027.html.[6] GOST 26645-85. Castings of metals and alloys. Dimensio-nal tolerances, weights and machining allowances. Mo-scow. PPC Publishing House of Standards (2004).[7] O. Shinskiy et al. Economics, ecology, organization of lost-foam casting production. Foundry production 4 (2017), 53-59.[8] V. Shulyak. Lost-foam casting, St. Petersburg, SLA «Pro-fessional» 2007, 55.[9] Lost-foam casting (2020). Armatool Portal. https://armato-ol.ru/lite-po-gazificiruemym-modelam-tehnologia-prei-musestva/.[10] Y. Stepanov et al. Lost-foam casting: Fundamentals of the-ory and technology, Moscow, Mechanical Engineering, 1976.[11] GOST 21357-87. Castings made of cold-resistant and we-ar-resistant steel. Portal of the electronic fund of legal and regulatory documents. https://docs.cntd.ru/document/ 1200011544.[12] GOST 1412-85. Cast iron with plate graphite used for ca-stings. Stamps, Moscow, PPC Publishing House of Stan-dards (2004).Note:  The responsible for English language is Dana Rahimbekova, Kazakhstan.Table 5  Profit and loss statement for the project  / mln USDYearIndicators 1 2 3 4 5Sales revenue 8,5 14,2 17,7 18,6 19,6Cost of production 6,1 9,4 11,5 12,0 12,6Gross income 2,4 4,8 6,3 6,6 6,9Expenses of the period 0,2 0,3 0,3 0,3 0,3Commercial expenses 0,0 0,0 0,0 0,0 0,0General and administra-tive expenses 0,2 0,3 0,3 0,3 0,3Amortization 0,7 0,6 0,5 0,4 0,3Prot before % and taxes 1,5 4,0 5,5 5,9 6,3Payments of %  on the loan 0,9 0,7 0,4 0,1 -Prot before taxes 0,6 3,3 5,1 5,7 6,3Corporate income tax - -0,5 -1,0 -1,1 -1,3Transfer of losses of previous years -0,6 - - - -Net prot / EBIT 0,6 2,8 4,1 4,6 5,0CONCLUSIONThe study’s findings reveal the country’s underde-veloped foundry business and the existence of substan-tial demand for its goods. The most common foundry goods have been determined in order to the project’s objectives.In compared to similar casting procedures, Lost-foam casting is considered to be the most contemporary and offers a number of technical and economic advan-tages.In general, the project is cost-effective and may be recommended for implementation based on the findings of the suggested financial model.

The feasibility study for the creation of production based on technology of lost-foam casting

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