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Metal Casting Technologies : September 2007
2007 OVERVIEW AsianFoundry 30 www.metals.rala.com.au Table 2.1. The major Exports and their relationship to the Foundries CHINA EXPORTS IN Y2005 ASIA: 48% EUROPE: 22% NORTH AMERICA: 23% VALUE IN BN US$ GROWTH OVER 2004 % TYPICAL CASTINGS CONSUMED DIRECTLY & INDIRECTLY IN THOSE MACHINES THAT ARE APPLIED TO PRODUCE THE EXPORT MERCHANDISE The RoW: 7% Office machines and automatic data processing machines 111 2 Diecast Mg/Al alloy, precision castings, instruments, gadgets. Telecommunication & parts 95 39 Copper/bronze switches, plastic injection moulding machines, dies & fixtures. Electrical machinery & household appliances 76 27 Motors, gears, switches, pipe, tubes and machine tools & moulds. Apparel & clothing accessories 74 20 Textile machine components, electrical instruments, motors, pumps Textile yarn, fabrics and made up articles. 41 23 Machine tools, control boxes and instruments & printing machines. Metal Products 27 31 Furnaces, moulds, patterns, wires, dies and control equipment General industrial machinery and parts. 26 30 Gears, valves, pumps, meters, flow units, transformers, dies, tools and injection molded parts. Road Vehicles 22 33 Automotive castings, forgings and engineered castings. Iron & steel 19 39 Ingot molds, continuous casting machines, cast roils -steel & SG iron Footwear 19 25 Al & steel moulds, injection-moulding machines for plastic and rubber components. Industrial Minerals, refractories & ceramic 55 25 Mining equipment, motors, pumps, and crushers, grinding media, tools, sieves and heavy engineering castings. Bulk chemicals & industrial commodities 115 20 Valves, machine tools, instruments, mixers, pumps, pipes and engineering tools and gadgets. The Jewellery 6 24 Precious metals processing, precision casting and meal polishing. Others 76 15 - Total Exports 762 28 Manufacturing =Castings=Foundry The castings growth and a gradual shift to value chain of foundry development are predominantly due to internal quality awareness, its growing importance and the consumption. The customs data do indicate that from 1998- 2006 the overall exports of castings have never exceeded a gross tonnage of 1.5-1.7 m tonnes per year that again supports local industry robustness. 3.0 The Future & the Value Evolution The castings growth will not be dramatic, as the future mix will experience consolidation of the market, closure of small scale, energy inefficient and polluting foundries. The existing regional imbalances particularly in the State Owned foundries will reduce, as the business model will change from captive type castings consumption to independent profit driven enterprises. This will lead to actual number of casting foundries reduction thereby leading to mergers and joint management of key strategic groups under government bodies for automotive, energy-turbine, diesel, railway, tractor, mining and pipe industries. Whilst the government will continue to attract FDIs in manufacturing industries so will be the resultant inflow of investments in the foundry sectors already multinational and homegrown castings groups have invested in green field sites for tonnage matching the western economy of scales 120 to 200 K tonnes per year. Even in aluminum wheel, pistons, engineering, diecast and lost wax processing industries there is a buoyant mood for large-scale investments in new technologies, plant layout with ultramodern in-house facility for machining centers. A number of local foundries have invested in overseas distribution networks including owning some warehouses and castings design & service enterprises especially in Germany, US, UK & Japan. The current mix is mainly consisting of 53% grey iron, 24% ductile iron, 12% cast steel, 6% al/Mg alloy, 3% Malleable and 2% Cu/Zn alloys in an estimated 14-17 m tonnes market, the projected growth in Y2020 mix will mostly shift toward ductile at 38% and Al alloy at 15% increasing at the expense of grey iron, cast steel and malleable castings. Y2020 tonnage is projected to reach 28 -30 m tonnes. Lean manufacturing systems coupled with new investments in overseas management talent in foundry industry is expected to enhance the competing ability of the local enterprises.