Paper Balers by Mark Henricks

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With talk of balers in the recycling industry comes talk of specialized markets, each with specialized baling needs; of China’s insatiable thirst for steel and the resulting rise in baler manufacturing costs; of the repercussions for buyers now shouldering this added financial burden; and of the balers, both vertical and horizontal, auto-tie and two-ram, each featured with ever-improving automation technologies and reporting capabilities—those highly-sellable, hi-tech bells and whistles that don’t, necessarily, add up to a quantum leap forward in baler quality.

The buyer, regardless of baling needs, expects ease of operation in a baler, accurate reporting on productivity, reliable diagnostic support and, in the end, a quality, dense bale. The current industry trends, relevant though they are to any informed baler purchase, serve merely to underscore these industry ABCs. “The main reason for baling,” says Roger Williams, vice president of sales for American Baler Company, an industry leader in the manufacturer of open-end auto-tie balers, “is to put raw material into a storable format. By reducing the space it took up as a loose product, the customer can maximize his freight costs.”

With less labor involved at their end, domestic mills and overseas markets will pay a premium—currently around $150 apiece—for quality, 1,000 pound mill-size paper bales. Subtracting the roughly $20 per bale a processor would have had to pay for the loose paper, plus another $25 in costs to create the bale and get it to market, the processor stands to earn up to $100 per bale. A high-volume operation, producing 30 bales per day using automated, horizontal auto-tie balers, could conceivably bring in $3,000 a day through its baling operations.

The potential value of a bale, though, depends largely on the efficacy of the baler in compacting materials and on its long-run reliability. Fancy new bells and whistles aside, the quality of a baler’s structural design is paramount. The touch-screens produced by Parker CTC and other control technology manufacturers have gone far in improving safety in baling operations (liability is a growing concern among manufacturers); they have facilitated improved maintenance and streamlined the steps necessary to — in the case of two-ram balers often used in recycling — switch between multiple materials from bale to bale merely by the push of a button. But the screens, as with the switches, starters, pressure transducers, Programmable Logic Controllers (PLCs) and other electrical components now packaged with balers, introduce their own unique problems into operations.

“The PLCs and the computers are not the keys to these machines,” says John Sacco, president of Sierra International Machinery, distributor of IPS Balers for the non-ferrous market and exclusive distributor of MACPRESSE balers. “The keys with balers are the hydraulics and the structure, the bread and butter. You can just as easily have a half a million dollar piece of equipment down for a faulty $40 electronic component.”

You can, as Sacco explains, have the best computer but the lousiest machine. The best machines, according to Greg Leon, director of marketing and sales for PTR Baler & Compactor Company (formerly Philadelphia Tramrail Co.), are those fabricated from structural steel, as with his company’s line of vertical balers. Operations that are tight for space, low on capital or low in volume tend to opt for these less-expensive machines, which typically require manual tying off of bales, a process that can take anywhere from 7 to 10 minutes apiece. A horizontal auto-tie, in contrast, can accomplish the job in less than a minute.

As such, vertical balers are favored by the likes of Costco, Home Depot, and other retail chains that aren’t necessarily high-volume processors but are constantly inundated with corrugated paper. Rather than toss the paper and thus money in a dumpster out back for hauling to the nearest landfill, they’ve found it far more economically- and environmentally-sound to toss the material in a vertical baler throughout the day, reduce it 15:1 in size, then turn around and sell it.

“With a vertical baler, users want to reduce their weight stream and increase their payback,” says Leon. “With one of our balers, they know they’re getting a machine that will do so for 15 to 20 years.” Most baler manufacturers, he points out, use plate or form steel and fabricate parts by bending them. “With form steel, if you take it and bend it, it remains a quarter inch thick,” making it less rigid or durable than structural steel. With structural steel, due to the method of forming it in a U-shaped channel, corners come out twice as thick as any one side, twice as tough as form steel.

Leon has no qualms about his company’s reputation for manufacturing the highest-priced vertical balers on the market; prices, due to the current state of the steel market, are only going up. Where a given vertical baler sold for $7,500 last year, it now commands $10,000 or more this year. Prices have escalated accordingly for the higher-capacity, higher-priced horizontal machines—the auto-ties favored by high-volume operations running 24-7 and dealing, for instance, with mountains of cardboard; and the two-ram balers required by operations processing non-ferrous metals.

Certainly innovations account for some of these added costs: investments in new pump designs have allowed manufacturers to increase the pressure generated by balers and thus reduce cylinder sizes, which in turn improves the overall processing speed; and with emerging technology machines are increasingly capable of troubleshooting and performing routine maintenance on their own.

Still, talk among baler manufacturing representatives inevitably reverts to steel prices, which last year rose almost 250%. Recent internet headlines tell the tale: “China’s Steel Sector Still Red Hot,” “Steel Makers to Suffer Heavy Losses.” As it is, China’s steel producers account for some 20% to 30% of the steel industry’s total profit. Investment in steel by the Chinese has escalated at a rapid pace in past years due to soaring international steel prices—around $100 higher per ton than domestic prices in China. With this built-in profit margin, Chinese steel producers are able to increase profits by raising their prices and shifting these costs to smaller steel-dependant manufacturers.

As a result, some baler manufacturers have taken to alternate, less costly construction methods as a way of shoring up declining profits. “They’ll do a study,” says Leon, “decide, ‘Hey, we don’t need as many welding hours, or we don’t need these stiffeners here, or we can replace these metal switches’—which may last 300 life cycles—‘with plastic switches that cost only $50,’ even though they may only last 50 life-cycles.” Somewhere, this catches up to the manufacturer and, ultimately, the buyer.

“With the increase in steel prices,” says John Sacco, “the buyers must understand that, when they opt for the less-expensive equipment, they’re buying a Band-Aid.” The buyers, in light of their particular needs, financial restrictions and the current market prices, may find a cheap-fix to be the most profitable in the short term, but the most costly in the end.