Copper Foundries

SIC 3366

Companies in this industry

Industry report:

This industry consists of companies primarily engaged in manufacturing copper and copper-alloy castings, except die-castings. Establishments that produce copper castings and also are engaged in fabricating operations for a specific product are classified in the industry of the specific product. Therefore, some of the companies considered to be a part of the copper foundry industry are not included in this classification, although some of the statistics covering the copper foundry industry do include these "captive" foundry departments of manufacturers.

Industry Snapshot

Copper processing actually has many divisions, including such diverse activities as mining, smelting, refining, and fabricating. Copper is mined and refined before alloys are added to it. Copper and copper alloys are sold to fabricators who create such products as forgings, rods, bars, and tubes that are used in the construction industry, telecommunications industry, and various manufacturing industries.

Copper is renowned for its corrosion resistance, electrical and thermal conductivity, machinability, color, and ease of finishing. Foundries combined copper with several other elements to create alloys with a wide range of qualities. Copper-based castings are strong and corrosion-resistant, making them essential as a basic tool in the building, plumbing, and automobile industries.

Foundries cast copper in many different ways. The most common of these are sand casting, centrifugal casting, continuous casting, investment casting, permanent mold casting, and shell mold casting. Sand casting, in which molten metal is poured into a sand mold, is the most widely used method of producing large quantities of copper and copper alloy castings. Because the cost of the sand mold patterns is usually reasonably low and sand is an incredibly reusable and then recyclable resource, this method of casting is ideal.

Centrifugal casting consists of pouring molten metal into a revolving or rotating mold, which in turn holds the molten metal against the wall by centrifugal force. This method is often utilized for casting bearings, gears, or machinery pieces. In a continuous casting system, molten copper alloy is fed through an open-ended mold to yield bar, tube, or other shaped cables.

Investment casting--also called precision casting--has an extensive history that predates the Egyptian pyramids. In the late twentieth century, it was still used to produce decorative copper applications and aircraft parts.

In the late 2000s, the industry reported 413 foundries primarily engaged in manufacturing copper and copper-alloy castings, with shipments valued at an estimated $1.4 billion and industry-wide employment of 10,920 workers. On average, each foundry employed 28 workers who generated about $4.2 million. Top producing states were California, Pennsylvania, Ohio, Texas, and New York. Collectively, these states held nearly 37 percent in market share. Foundries in the United States produced more copper-based castings than every nation except China.

Organization and Structure

One of the mainstays of the U.S. copper industry is the Copper Development Association (CDA). Its members include the primary copper producers, miners, and smelters described in SIC 3331: Primary Smelting and Refining of Copper; manufacturers of mill products such as sheet, strip, rod, bar, tube, and pipe described in SIC 3351: Rolling, Drawing, and Extruding of Copper; as well as the copper foundries of this industry. CDA tracks market statistics and publishes handbooks, reports, and bulletins as part of its efforts to broaden copper markets in this country and abroad.
The American Foundrymen's Society (AFS) comprises the foundries of the United States, Canada, and Mexico. It is a professional, technical, and management association that works with government leadership to influence Congress on legislative issues, prepare educational programs, and perform research for its members and interested lay people.

Background and Development

Copper-based castings have a long history. Copper artifacts have been dated back to 8700 B.C., and smelting was being performed as early as 5000 B.C. Casting, especially sand casting, is one of the oldest known methods of producing metal components. As agricultural equipment, shipping equipment, and plumbing developed, so did the need for advanced castings. Nonferrous castings, including copper-based castings, also became essential to the modern world with the proliferation of automobiles, televisions, airplanes, and telecommunications equipment.

In the 1950s and 1960s, induction furnaces were used in most foundries to melt brass and other copper alloys. Core, or channel, furnaces and coreless, or crucible, furnaces were both induction furnaces in which current was induced into the metal before it was melted. The temperature of the metal to be poured was carefully monitored by a pyrometer. Pyrometers became increasingly accurate and easier to read as the technology improved during the 1960s.

There were tremendous advances in technology and environmental science from the 1960s through the 1980s. As foundry practices began to adapt to these advances, the improvements saved money, increased efficiency, and assisted U.S. foundries in maintaining world leadership in the field, which was becoming an increasingly difficult task with the emergence of casting producers in foreign countries. Many of these foreign foundries boasted state-of-the-art facilities, low labor costs, and subsidized work. Having difficulty competing with these imports, U.S. foundries accused their foreign counterparts of dumping products below costs.

The metalcasting industry is a basic component of all industrial societies, but the economic upheavals in the 1970s and 1980s brought tremendous change to the industry. Many foundries had to close their doors, while many merged into larger companies.

Although shipments for the copper foundries industry increased from $853 million in 2005 to more than $999 million in 2006, the Copper Development Association (CDA) reported that overall consumption of refined copper in the United States actually declined 7 percent to its lowest level in 15 years. The domestic level of consumption of copper in 2006 was more than 30 percent less than the peak in 2000. A weak housing market and record high copper prices that prompted destocking of supply caused the low overall demand for copper products in the United States in 2006.

According to the CDA, the supply of copper and copper-alloy products by fabricators declined 2 percent in 2006. Included among fabricators are brass mills, wire mills, and powder producers along with foundries.

Copper prices spiked in 2006 after closing 2005 at $2.16 per pound. The price went to $2.50 per pound by March 30, 2006, then shot up to $4.08 per pound on May 23 of that year. The price fell back to $2.85 per pound by the end of 2006, only to rise again in April 2007. Through the second and third quarters of 2007, the U.S. producer price averaged more than $3.50 per pound, leading to further concerns about copper substitutes, particularly, aluminum substitutes for copper in electrical equipment, automobile radiators, and cooling and refrigeration tube.

Current Conditions

According to the Copper Development Association, over 40 percent of copper demand is utilized in construction with residential construction responsible for about two-thirds of that total, or 439 pounds of copper for one standard single-family structure. Overall residential construction fell 28 percent from 2006 and 2009, with new starts projected to grow a mere one percent in 2010.

Furthermore, during the first nine months of 2008, the price of copper averaged $3.65 per pound before plummeting to $1.45 in December as the economy worsened. Copper prices trended upward reaching $2.82 per pound in September 2009. Fluctuating prices led to further copper substitutes to include optical fiber in place of copper for telecommunications applications and plastics instead of copper in water and drain pipe, as well as plumbing fixtures.

Copper-alloy castings were expjected to increase 2.1 percent between 2009 and 2010 even though imported castings would account for 27,000 tons during the same time period. Economic conditions were expected to gradually improve for the casting industry; however, increased imports were likely to keep gains to a crawl. Overall metal casting shipments were forecast to rise six percent in 2010 and only one percent annually through 2018.

Industry Leaders

Federal-Mogul Corp. of Southfield, Michigan, had 2006 sales of $6.3 billion from all of its automotive parts ventures. Asbestos claims caused the company to enter Chapter 11 bankruptcy protection in 2001, but Federal-Mogul exited Chapter 11 late in 2007, posting revenues of $6.9 billion. The company's revenues plummeted to $5.3 billion in 2009 as the economy worsened. Phelps Dodge was acquired by Arizona-based Freeport-McMoRan Copper & Gold Inc. in March 2007. Other industry leaders in the late 2000s were Phoenix-based Phelps Dodge; Tucson-based BHP Copper North American Operations; JSJ Corp. of Grand Haven, Michigan; and Revere Copper Products Inc.

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