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EXPLANATION NOTE
to turnkey construction project of a plant
for production of the following:
- sodden cord fabrics based on polyester HMLS threads with production capacity of 5,280 tons/year,
- cord fabrics based on polyamide 66 (PA66) threads with production capacity of 3,065 tons/year
(AM-Cord project)
The AM-Cord project provides the production of new for Russian market and competetiv goods: cord fabrics from polyethylene terephthalate (PETF) and polyamide 66 (PA66).
The world production of tire cords is more than 900 thousands per year.
In Russia and former USSR countries tire production is based on cord fabrics from polyamide 6 which is of the little use for car and aircraft tires as well as tires for long trucks.
Also cord fabrics currently in production aren't sodden with special mixtures for higher adhesion between fabric and rubber. Historically these operations are being made on aged equipment of tire factories.
Therefore prospective of tire enterprises development in Russia will be determined by an ability of tire production from high-quality synthetic cord fabrics.
Polyester cord fabrics
Nowadays world production of polyester cord is about 300 thousands of tons per year . In the end of 80-s - beginning of 90-s the leading engineering and technology companies developed the special technology of polyester cord production which allows to make radial tires for maximum driving comfort and safety. This technology is based on usage of high-molecular polyester threads formed from high-molecular polymer with a forming speed of about 6000 meters per minute. Trade mark of this thread - "polyester thread HMLS".
There are two objective reasons making possible the wide development of HMLS-threads production and their usage for car tires. Using of HMLS threads avoiding the need to pump a tire in a process of its cooling after vulcanization. Besides, the HMLS threads have a feature of side-dent absence.
HMLS thread - high-module, low-shrinkage thread.
High module provides the high strength of thread with low thermal shrinkage. For module characteristics generally used the LASE 5 indicator (strength in 5% stretching). This indicator, also called as "starting module" is the key factor for tires because the operating point of cord in tires is situated in the lowest part of curve "load - lengthening". An important information about thread's features contains in the second part of it's trade mark name - low shrinkage (LS). The meaning is that thread does not significant change its length under the mechanical force and temperature. That means the spatial stability of cord fabric and the tire itself.
Modern requirements of leading tire developers to quality features of HMLS threads are the following:
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high module LASE 5
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>= 4 CH/d tex; (with 5% lengthening)
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low shrinkage in hot air (180 Celsius degrees)
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<= 5%
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lengthening causing breach + shrinkage in hot air
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<=14% + <=4%;
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high strength
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>= 6.8 cH/d tex
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This high requirements to HMLS threads forced the process developers to solve a wide range of problems, major of them are:
- production of high-molecular and minimum unstructured polyethylene terephthalate with providing a thread tenacity in a range of 0.88 - 0.94;
- providing good fibrillated super-molecular structures allowing to reach a high module and low shrinkage after the following drawing out;
- reaching a needed evenness in a process of cooling from filament to filament, in even drawing with spinning preparation, circular and longitudinal at any filament on a forming speed of around 6000 meters per minute.
- Solving a problem of an adhesion between fabric and rubber.
In general the HMLS threads production is very delicate and high technology process.
Raw materials for AM-cord project must be only a high quality amorphous granulate produced from terephthalate acid and ethylene glycol with tenacity of 0.55 - 0.63.
This granulate may be delivered by the Sibur-PETF Inc., Tver or from South-East Asia or Europe. Anyway the technological process must begin from an installation of solid phase additional polycondensation with the following operations:
- one-stage process of high speed forming and drawing out of technical threads with a speed of approximately 6000 meters/min;
- twisting and weaving;
- steeping of cord fabric.
In production program it is advisable to foresee the cord fabric production of the mostly wanted by tire factories kinds, e.g.:
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Structure (basic)
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Production capacity, tons/year
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Production capacity, millions of linear meters per year
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Thread, 111 tex x 2, weighting out: 387 g/linear meter
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1790
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4 .63
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Thread 144 tex x 2, weighting out: 483 g/linear meter
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3490
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7.20
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Polyester cord, total
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5280
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11.83
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Cord fabrics from PA 66
Nowadays the world production of polyamide cord fabrics is about 600 thousand of tons per year. Until the last time the tire production of Russia, China and India were oriented to cord from polyamide 6 when in USA, Europe and Japan fabrics of polyamide 66 are in use.
As we mentioned before for making aircraft tires, huge-sized tires and also the tires for long trucks, cord fabric from PA 6 is of a little use. Such tires have multi-layer skeleton. Huge cycling work of tires is the reason of high heat generation which is slowly dissipating due to multi-layer structure of tire. Unfortunately work temperatures of long-working PA6 cord are very low (110-115 oC) when PA66 cord works under temperatures of about 180 ?C. That's why the PA66 cord is the best choice for this class of tires, in spite of its relatively high cost due to expensive raw materials (hexamethylene diamine and adipinic acid)
The modern requirements of leading tires developers to quality of technical threads from PA66 are the following:
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Parameter
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Measurement unit
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Value
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Breaking load
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sN/d tex
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>= 8.7
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Breaking lengthening
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%
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<= 23.0
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Shrinkage in hot air (160 oC)
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%
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<= 7.5
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As a raw material for AM-Cord project it's advisable to use the free market accessible technical threads 93.5 and 187 tex because the synthesis of PA66 and thread forming require the higher investments those are not profitable for small production capacities.
Production plant will consist of the following machines and equipment:
- Plant of continuous solid-phase polycondensation with production capacity of 20 tons per day;
- Plant for HMLS threads production with two 4-position fiber spinning beams;
- 20 twisting machines (152 spindles);
- 13 rewinding machines;
- 10 looms, including bobbin carriers;
- two-stages steeping aggregate for chemical and thermal processing of cord fabric.
Below there are preliminary technical and economical indicators of AM-cord project. The serious business plan may be developed in a preliminary contract negotiating process.
Preliminary approximation is being made for an investor to help him to make a principal decision about participating in this project realization.
1. Production of goods
Basing on today's world prices on cord fabrics from HMLS threads, the following prices for cord fabrics are projected:
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No
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Assortment
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Production capacity
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Price
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Income
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Tons per year
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Millions of linear meters per year
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1.
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Cord fabrics from PE threads, total
Including:
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5,280
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11.83
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-
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38,160
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- from thread 111 tex x 1 x 2
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1,790
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4.63
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2.8
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12,960
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- from thread 144 tex x 1 x 2
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3,490
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7.20
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3.5
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25,200
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2.
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Cord fabric from PA66, total
Including:
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3,065 |
6.92 |
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27,620 |
| - from thread 93.5 tex x 1 x 2 |
825 |
2.94 |
2.9 |
8,250 |
| - from thread 187 tex x 1 x 2 |
2,240 |
3.98 |
4.8 |
19,100 |
| Total production capacity and income: |
8,345 |
18.75 |
- |
65,780 |
The immediate and most important task is an agreement about delivery amounts and prices with tire factories (Nizhnekamsk, Kirov, Omsk, Krasnoyarsk, Bobruysk).
2. General technology raw and supplementary materials
The general technological raw materials are accessible in a world market.
Amorphous PET granulate prices are projected in a size of 1300 ˆ/ton (tax and fares are included)
Technical thread 187 tex from PA66 prices are projected in a level of 3900 ˆ/ton (tax and fares are also included)
| No |
Raw material |
Requirement, tons/year |
Price, ˆ/ton (without taxes and fares) |
Cost, thousands of ˆ/year |
| General technology raw-materials |
| 1. |
PETG granulate |
6,000 |
1,100 |
6,600 |
| 2. |
Technical thread from PA66 |
3,160 |
3,300 |
10,430 |
| Total cost of general raw-materials |
17,030 |
| 3. |
Supplementary raw-materials and other materials including filling thread, preparations, impregnation mixtures etc. |
1700 |
| Total raw-materials cost |
18,730 |
3. Power consumption
| Sort of energy |
Measurement unit |
Consumption for 1 ton |
Consumption for the year production |
Price ˆ/unit |
Cost of energy for year production, thousands ˆ |
| Electricity |
kWt*hour |
4,000 |
32,600,000 |
6 |
1,970 |
| Natural gas |
M3 |
41 |
420,000 |
3 |
10 |
| Annual power consumption |
1,980 |
4. Personnel
| Personnel category |
Amount |
Average month salary, ˆ |
Annual salary, thousands ˆ |
| Administrative |
40 |
800 |
320 |
| Engineering |
120 |
500 |
500 |
Total: 210 1070
| Social security tax (for Russia - 26.5% starting on 01.01.2005)
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280 |
| Personnel expenses, total: |
1350 |
5. Production and sales expenses
| No |
Expense item |
Annual production expenses, millions ˆ |
| 1. |
Raw materials |
18.73 |
| 2. |
Energy |
1.98 |
| 3. |
Renumeration of labor, including social security taxes |
1.35 |
| 4. |
Amortization (44.0 x 0.1 + 12.3 x 0.05 |
5.00 |
| 5. |
Other expenses, including indirect expenses and equipment exploitation expenses projected in a volume of 7% of total expenses indicated in #1 - #4) |
1.90 |
| Total |
28.96 |
6. Construction and mounting
According to experts appraisal construction expenses may be around 8,000 - 10,000 thousands ˆ.
Expenses of chief-mounting, starting works and guarantee testing, made by company know-how owner, are included in equipment prices.
Total mounting works volume is projected at approximately 225,000 man-hours, including:
- Mounting of polycondensation, forming and drawing machines: ~90,000
- Mounting of twisting, weaving and steeping machines and aggregations ~110,000
- Auxiliary mounting ~25,000
7. Total investment expenses for AM-Cord project
| Expense item |
Value |
| General investments, total: |
59.7 millions ˆ |
| Equipment, including know-how, engineering, chief-mounting, chief-start, total: |
12.3 millions ˆ |
| Construction and mounting |
44.0 millions ˆ |
| Working capital |
2.1 millions ˆ |
| Personnel expenses before starting of production |
1.3 million ˆ |
| Investment placing: |
59.7 millions ˆ |
| - Amortizable actives, total |
56.3 millions ˆ
Including: |
| - buildings, communications |
12.3 millions ˆ |
| - equipment: |
44.0 millions ˆ |
| - Floating funds |
3.4 millions ˆ |
8. Effectiveness indicators of AM-Cord project
| Index |
Values |
General investments, total
Including:
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59.7 millions ˆ |
| - equipment |
44.0 millions ˆ |
| - construction and mounting |
12.3 millions ˆ |
| - working capital |
2.1 millions ˆ |
| - personnel expenses before the production start |
1.3 millions ˆ |
| From the general investments: |
56.3 millions ˆ |
| Capital investments |
| Raw materials expenses |
18.8 millions ˆ |
| Production and sales expenses |
29.0 millions ˆ |
| Sales income (w/o taxes) |
65.8 millions ˆ |
| Annual profit before taxes |
36.8 millions ˆ |
| Profit tax (24%) |
8.8 millions ˆ |
| Net profit |
28.0 millions ˆ |
| Internal funds: |
33.0 million ˆ |
Turnaround time from production start:
Of general investments: |
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| Due to internal funds: |
1.8 years |
| Due to net profit: |
2.1 years |
| Of Capital investments: |
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| Due to internal funds |
1.7 years |
| Due to net profit |
2.0 years |
Conclusion
In the AM-Cord project the newest technologies and the equipment are pawned, that, certainly, will impose increased requirements to the administrative and basic technological personnel.
The volume of output satisfies approximately 60% of need of Russian tire factories if those factories will be ready to process the new production.
Speaking about selling, it is necessary to consider an opportunity of export the ready cord fabrics to the countries of the former USSR, China and the countries of the European Union where needs in cord fabrics from HMLS threads and PA66 threads grows constantly.
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