Introducing minerals into the mix certainly adds complexity to profit calculations. All ore types with the exception of Veldspar and Mercoxit (only found in wormholes and null sec) are refined into more than one mineral. It's highly likely that best prices for different minerals will be offered in different systems. So that either means more warping around or taking a certain loss on the income.
For the purposes of this post, I only considered the highest regional prices for ore and minerals irregardless of their specific system location. The region of my choice was The Citadel of Caldari State. Prices vary across regions and change every day, if not every hour, so you have to constantly keep updating your records.
There's three different parts to getting the 100% refining yield. First, there's the refining skills that you have to train (Refining, Refining Efficiency, specific ore refining - i.e. Veldspar Processing). Second, the tax rate on refining at the stations depends on your standings with the corporation that owns the station. Third is the base refining yield of the station: most high-sec stations have base yield of 50%, but some have it as low as 35%.
 |
| Station stats on yield and tax; Net Yield = Station Base Yield + your refining efficiency |
The first hurdle is more or less easy to overcome. It's only a matter of training time. Training up Refining up to level V to be able to train Refining Efficiency is highly recommended. You don't have to train Refining Efficiency to level V, because training specific ore Processing skill a few levels should provide more than enough skills to be able to get the net refining yield to 100%. Make sure the station that you use for refining also offers 50% base yield. The lower the base yield, the higher you have to train the processing skills.
The refining tax rate of the corporation is an issue that is much tougher to work around. If you don't have any standings with the corporation, then 5.00% tax rate will be applied on all refined materials. To get the tax rate to 0.00% you have to grind up the standings with the corporation to above 6.67 and that will take some time. It is quite unfeasible for a new player to gain that unless you are part of the corp whose members have already gained that standing and can refine the ore for you.
The best you can do at this point is try to refine at the stations whose corporation you have the best standings with. It will likely be the school that you have started with at first, unless you have been doing lots of missions for some other corporation already.
Now time for some numbers! Just to remind you: my Refining skill is at level IV and I'm refining at a station with the base yield of 50% and tax rate of 5.00%. Overall, my net refining yield comes out to 90.5% (minutes 5% tax) and I'm using the best regional prices for ore and minerals regardless of their specific system location.
To determine if it's better to sell the raw ore or sell the refined minerals, I took a look at how much tritanium I can extract from veldspar ore (333 units of Veldspar = 1000 units of tritanium with 100% refining and no tax).
 |
| Veldspar refines into Tritanium |
I selected 333 units of Veldspar in the refining window and got the quote: I receive 860 units, the station takes 45 units and 95 units are lost in the refining process.
 |
| Getting the quote for refining |
333 Units of Veldspar @ 12.91 ISK/unit market price = 4299.03 ISK
860 Units of Tritanium @ 4.56 ISK/unit market price = 3921.60 ISK
With the current skills and tax rate it is 377.43 ISK LESS profitable for me to refine rather than sell the raw Veldspar ore. Let's take a look at a theoretical yield of 100% and no tax:
333 Units of Veldspar @ 12.91 ISK/unit market price = 4299.03 ISK
1000 Units of Tritanium @ 4.56 ISK/unit market price = 4560.00 ISK
Under 100% refining rate and no taxes it is 260.97 ISK MORE profitable to refine than to sell the raw Veldspar ore. Adding the 5% tax, it'll still be more profitable to refine, although with a much smaller profit margin.
Let's take a look at a more complicated ore, such as Pyroxeres. Pyroxeres ore is refined into Mexallon, Nocxium, Pyerite and Tritanium.
 |
| Pyroxeres refines into Mexallon, Nocxium, Pyerite, Tritanium |
333 Units of Pyroxeres @ 48.00 ISK/unit market price = 15984.00 ISK
- Total profit = 15984.00 ISK
103 Units of Mexallon @ 55.03 ISK/unit market price = 5668.09 ISK
9 Units of Nocxium @ 509.17 ISK/unit market price = 5600.87 ISK
51 Units of Pyerite @ 5.17 ISK/unit market price = 263.67 ISK
726 Units of Tritanium @ 4.56 ISK/unit market price = 3310.56 ISK
- Sum and total profit = 13824.85 ISK
That's 2159.15 ISK I would lose if I was to refine Pyroxeres with my current skills and station tax rate.
It seems that I have to invest a lot more time into training Refining skills. Refining at level V won't be enough to break even under current market conditions either. I would have to train Refining Efficiency and specific ore Processing as high as possible to get the 100% refining yield. To get the station tax rate down, I would also have to do some missions for the corporation that owns the station.
If you will be mining for a while, then refining skills are well worth investing into. However, it's more of a long-term skill rather than something that has to be trained right away. A new character starting out in mining would benefit much more from simply training up skills related to mining yield.
It all highly depends on market conditions though. The advice in the last paragraph may become useless within a week, or actually be useless right now somewhere else besides The Citadel region. It's a very good idea to do your own calculations like I showed here for your current location. Just get the refining quote for the ore of your choice, see how much minerals you get out of it and do a quick calculation to see if it's worth to refine.
One more thing to note: whereas you would sell the ore to the highest bidder at a particular station, refining the ore will give you multiple minerals, and those may have highest bidders at different stations. So it's up to you to decide whether it's worth your time to travel around the region to squeeze a couple of extra ISK out.
On the other side of things, I took a few days off to let the Industry skill train up to level V. There's one more day remaining before I can start training Mining Barges. The skill queue for the last two days was:
- Drones IV
- Industry V
The Retriever is now within the reach!
Thanks for the info! I had done some basic calculations and came to the same conclusion, but since I'm a pretty new player, I wasn't sure if I was missing something. You explained all the factors to take into consideration.
ReplyDeleteI'm very glad I could be of help. Mining and manufacturing are all about the calculations and they can get pretty confusing. If you are trying to determine your profit margins frequently, my advice is to set up an Excel spreadsheet and simply plug in the market prices as opposed to going over the equations manually every time. Happy mining out there!
ReplyDelete