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For many shops, handling and recycling chips is simply a messy inconvenience with limited payback. Such operations often receive little attention because they are commonly viewed as housekeeping chores that contribute little to the bottom line. For one precision manufacturer, however, viewing chip handling and recycling as an important aspect of its overall manufacturing process has led to increased scrap payback, less waste and a cleaner shop. The key is a chip compactor with a high-volume, energy-saving design that occupies no more space than a typical machining center.

Based in Minneapolis, Minnesota, Production Engineering Corporation was founded in 1957 to serve the needs of an emerging computer industry and quality-conscious defense contractors. Today, the company provides complex, precision parts for the medical and aerospace industries. According to Clint Emmert, vice president of manufacturing, the shop had always been conscious of scrap because most of its jobs require a great deal of metal removal—enough to generate 1.5 tons of aluminum chips on a daily basis. However, the company’s attention to chip handling accelerated during the past few years when scrap payback couldn’t keep pace with increases in the cost of aluminum.

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“Looking back, a new era was beginning for companies like ours generating aluminum chips—not just because the material’s value was increasing, but also because new technology was being developed to meet those needs,” Mr. Emmert says. “All of the emerging environmental and worker-safety issues had to be addressed as well.”

The company’s chip-processing operation consisted of filling barrels for daily pickup by a local scrap dealer. The dealer paid a flat rate per pound of chips. In addition to not receiving the prevailing market rate for its scrap aluminum, the shop was penalized because the chips were wet with machine coolant that had to be removed before the smelting process could begin.

The shop had used Anglock vises from Kurt Manufacturing for a number of years, so it turned to the provider of workholding, gaging and chip-management products for a solution to these issues. Having experienced its own scrap problems on a large heat-sink job, Kurt demonstrated how it improved its bottom line by performing chip compacting and coolant removal in-house. The company recommended its Chipmunk compactor system, which it developed based on its own experience.

Mr. Emmert says what sets the Chipmunk apart from other compactors on the market is its simplistic design and its kinetic energy drive, which produces an 8:1 compaction ratio. “We want to produce the densest chips possible for the best payback and lowest cost of operation, so the density quality of the briquettes is very important to us,” he explains. “Plus, the device itself is a high-volume machine for its compact size, and it is simple and easy to operate.”

The Chipmunk features a single auger feeder that operates from a compression plate, which forms and compresses the wet chips into 3.5 by 1.25 inch continuous, extruded briquettes. According to the manufacturer, its 30-hp motor is approximately half the size of motors used in most hydraulic compactors. Additionally, the machine compresses out more than 95 percent of coolant residue, resulting in firm, dry briquettes that require no further coolant removal. The recovered coolant collects in a separate reservoir at the base of the system for filtration and reuse.

Upon arrival of the new compactor, Production Engineering partnered with a new local recycler and changed its entire chip-management process. To replace the old 55-gallon barrels, the new recycler provided the company with boxes measuring 48 by 48 by 48 inches, each holding 3,000 pounds of compacted briquettes. Chips produced by the company’s machining centers are placed in movable carts that are lined up for loading into the compactor. After loading, the Chipmunk operates unattended to automatically fill each box with briquettes. Filled boxes are weighed, placed in a truck trailer located at the nearby loading dock, and replaced with empty boxes until the trailer is filled.

With this new method, none of the chips accumulate on the plant floor, and all chips are processed on the same day that they are produced. The compactor’s coolant-recycling capability has also helped the shop eliminate issues with coolant draining. In addition, there are no “short weighing” problems because the company already knows how much each box of briquettes weighs, give or take a few pounds. Every 30 days, the shop receives a check based on market prices for the compacted aluminum chips along with a settlement report. This report is verified against the weight of the shipped briquettes to ensure the shop receives full credit.

The result is a sales improvement of 10 cents per pound of aluminum chips. “At 3,000 pounds of chips per day, that’s very important to our profitability—and the higher return gets better as the price of aluminum increases,” Mr. Emmert says.

Having a rigid, flow-through process for chip handling has improved more than just return on scrap. The shop is now much cleaner, especially the floors, which are free of spilled coolant and stray chips. Virtually nothing is wasted or discarded because chips and coolant are saved, and the Chipmunk system occupies much less space on the shop floor than the 55-gallon barrels previously used to collect chips.

“Our workers understand that chips are a byproduct and must be treated with as much care as finished parts,” Mr. Emmert says. “Also, our customers appreciate top-notch housekeeping because they know it contributes to a more positive worker attitude, which in turn contributes to quality and efficiency.”