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How much does a baler really cost?
Learn how to calculate the life cycle cost of any baler
Buy the right baler, and you can save so much money that the machine will be “free of charge!” Don’t believe me? Continue reading, and I will calculate the operating costs for six balers and show you where the real costs (and savings) in operating a baler lie.
A baler is a big investment. Unfortunately, it’s way too easy to fixate on the purchase price when comparing offers for different balers. A quality baler should last for many years. To know what the machine actually costs your company, you need to look at more factors than just the purchase price; energy consumption and consumables are the two most important.
To get an overview of the costs, we need to calculate the life cycle cost of the balers. Only when we have done that can we really compare the offered machines and see which one will be the cheapest for our company. We will calculate the cost for three different scenarios and six different channel balers. The idea is to clearly describe how we calculate the different parts of the life cycle cost so you can easily make your own calculations. We estimate the life expectancy of the machines to be 15 years (even though a well maintained baler can operate much longer than that).
The life of the baler in three parts
There are different ways to calculate life cycle costs (also called whole life costs). In this post, we have chosen to divide the life of a baler into three phases:
Acquisition
This includes choosing which baler to buy and the transport, installation and commissioning of the baler.
Operation
Here we find all the major costs such as electricity, personnel, service, and consumables.
Divestment
It also costs money to retire the machine. It must be dismantled, transported away, and perhaps scrapped. But it could also be sold on the second-hand market.
Acquisition
The acquisition part involves several costs that we may summarize as “start-up costs.” This is simply the cost of getting started with the machine. These include:
- Choosing a baler: cost to specify needs, meeting with the seller, review of tenders. This takes time and may require travel to look at reference facilities.
- Purchase price
- Transport to your facility
- Installation
- Training
- Commissioning
The only cost in this list that can really affect the life cycle cost is the purchase price. In practice, the other “start-up costs” are too small to make any difference when calculating the cost of a machine’s entire life from the cradle to the grave.
Operation
Operation is the longest and most expensive phase of a baler’s life. It includes costs for:
- Power consumption
- Staff
- Service
- Repairs
- Wear parts
- Consumables
- Financial costs
Three examples
To calculate the life cycle costs for different balers, we use three fictional companies (called “Small,” “Medium,” and “Large”) with different requirements. Requirements and conditions are specified as follows:
Volume per year – the amount of material that the company must bale per year.
Types of material – types of material (OCC, newsprint, soft plastic, etc.) and density before compaction.
Operating conditions – how the baler will be operated:
- Number of staff shifts
- Number of operating days per week
- Number of operating days per year
- Operational machine time per day (Actual number of hours the baler is in operation)
Capacity requirement – amount of material that needs to be baled per hour to handle the amount of material to be baled per year: Volume per year/operational machine time per year=capacity requirement per hour.
For each company, we calculate the costs for two different types of balers that suit the company’s requirements and compare the results. We estimate a “lifetime” as 15 years. However, it is quite common for well-maintained balers of good production quality to have a longer lifespan than 15 years.
Small company
Volume per year: 15 000 tonnes
Types of material: OCC and other materials with a density of 50 kg/m³ before compaction.
Operating conditions:
- 1 shift/day (8 hrs total)
- 5 days/week
- 220 days/year
- Operational machine time per day: 6,5 hrs
- Total number of operating hours 15 yrs: 21 450
Capacity requirement: 10,5 tonnes/hr
Baler 1
Presona LP 60 VH1 – a prepress baler with a 37 kW motor
Purchase price: €165 000
Baler 2
Shear baler with 75 kW motor
Purchase price: €140 000
Medium company
Volume per year: 40 000 tonnes
Types of material: Various types of plastic with a density of 30 kg/m³ before compaction.
Operating conditions:
- 2 shift/day (16 hrs total)
- 6 days/week
- 270 days/year
- Operational machine time per day: 13 hrs
- Total number of operating hours 15 yrs: 52 650
Capacity requirement: 11,4 tonnes/hr
Baler 1
Presona LP 85 VH2 with cross strapping – a prepress baler with a motor capacity of 90 kW (2×45)
Purchase price: €250 000
Baler 2
Shear baler with motor capacity :165 kW (3×55)
Purchase price: €212 500
Large company
Volume per year: 200 000 tonnes
Types of material: Various types of paper (OCC, newspaper etc.) with a density of 50 kg/m³ before compaction.
Operating conditions:
- 3 shift/day (24 hrs total)
- 6 days/week
- 270 days/year
- Operational machine time per day: 20 hrs
- Total number of operating hours 15 yrs: 81 000
Capacity requirement: 37 tonnes/hr
Baler 1
Presona MP 270 MH “MEGA” – a baler with precompression and a motor capacity of 240 kW (2×75 + 2×45)
Purchase price: €700 000
Baler 2
Shear baler with motor capacity: 300 kW (4×75)
Purchase price: €600 000
Power consumption
Balers are large machines, and regardless of manufacturer and model, a lot of energy will be used. But the differences in electricity costs between two balers with similar capacity can be surprising!
Small – energy cost 15 years
| Baler | Operating hours 15 yrs | Motor size | Total kWh 15 yrs | Cost Germany (€0.1818/kWh) | Cost USA ($0,0693/kWh) |
|---|---|---|---|---|---|
| Presona LP 60 VH1 | 21450 | 37 kW | 793 650 | €144 286 | $55 000 |
| Shear baler 75 kW | 21450 | 75 kW | 1 608 750 | €292 471 | $111 486 |
| Money saved: | €148 185 | $56 486 |
The tables show the difference in electricity consumption over 15 years and two examples of actual electricity costs. Electricity prices are prices for non-household / industry for Germany (high electricity price) and the USA (low electricity price) and include “non-recoverable” taxes.
Medium – energy cost 15 years
| Baler | Operating hours 15 yrs | Motor size | Total kWh 15 yrs | Cost Germany (€0,1818/kWh) | Cost USA ($0,0693/kWh) |
|---|---|---|---|---|---|
| Presona LP 85 VH2K | 52 650 | 90 kW | 4 738 500 | €861 459 | $328 378 |
| Shear baler 165 kW | 52 650 | 165 kW | 8 687 250 | €1 579 342 | $602 026 |
| Money saved: | €717 883 | $273 648 |
Large – energy cost 15 years
| Baler | Operating hours 15 yrs | Motor size | Total kWh 15 yrs | Cost Germany (€0.1818/kWh) | Cost USA ($0,0693/kWh) |
|---|---|---|---|---|---|
| Presona MP 270 MH | 81 000 | 240 kW | 19 440 000 | €3 534 192 | $1 347 192 |
| Shear baler 300 kW | 81 000 | 300 kW | 24 300 000 | €4 417 740 | $1 683 990 |
| Money saved: | €883 548 | $336 798 |
Conclusion – engine size is important
It is easy to forget how the motor size affects the operating costs of a machine like this. Large motors in combination with high electricity prices can be a costly affair. Both pre-press balers and shear balers can be equipped with frequency converters to reduce their energy consumption.
If we calculate the cost for 15 years, it is clear that you can save a lot of money by choosing an energy-efficient baler. In our examples, you can see that even with a low electricity price, you can almost buy a brand new baler with the money you save. If you have a high electricity price, you can buy one or more new balers with the money you save on lower electricity consumption!
Consumables (wire)
Wire to hold the bales together is a large and costly consumable for balers. Each bale requires several meters of wire. A baler with an efficient tying mechanism can use two meters less wire per bale, which means great cost savings over 15 years!
Below we calculate the total wire cost for our three companies.
First, we need to calculate the amount of wire used per bale. The difference in how much wire different balers use is really about how much wire is left after the twist. We call this leftover part the “pigtail,” as shown in the photo. The pigtails serve no purpose. They are just a waste of money.
There is money to be saved here! You will find the details on how to calculate the wire consumption beneath the photo.
Small – wire usage per bale
| Presona LP 60 VH1 | Shear baler 75 kW | |
|---|---|---|
| Bale size (h×w×l) | 750×1100×1200 mm | 750×1100×1200 mm |
| Wire around the bale | 19 500 mm | 19 500 mm |
| Wire for tying | 3 000 mm | 3 000 mm |
| Wire for pigtails | 1 000 mm | 3 000 mm |
| Total wirelength/bale | 23 500 mm (23.5 m) | 25 500 mm (25.5 m) |
| Difference | -2 000 mm (-2 m) | |
Thus, the difference is two meters or just over eight percent more wire per bale for the shear baler in the example. That doesn’t sound like much, but what does it mean in costs over 15 years?
Assuming each bale weighs 500 kg, the Small company will produce 30,000 bales (15,000,000 / 500) per year and 450,000 (15 × 30,000) bales over 15 years. The wire price is calculated at €0.05/m, which means that you can save €45,000 by choosing a baler that saves on wire, see the table below.
Small – wire cost 15 years
| Presona LP 60 VH1 | Shear baler 75 kW | |
|---|---|---|
| Number of bales 15 yrs | 450 000 | 450 000 |
| Meters of wire 15 yrs | 10 575 000 | 11 475 000 |
| Wire cost 15 yrs | €528 750 | €573 750 |
| Money saved | €45 000 |
Medium company
The bales in the Medium company are as large as in the Small company, but here cross strapping is also used to hold together the plastic that has been compressed. That adds three wires. Since the cross strapping is done from the side, the wire length will be (750 + 1100) × 2 × 3 = 11100 mm. The wire for the ties will be 150 × 2 × 6 = 1800 mm, a total of 12900 mm or 12.9 meters for the cross strapping. In the table below, I have summarized all wire usage.
Medium – wire usage per bale
| Presona LP 85 VH2K | Shear baler 165 kW | |
|---|---|---|
| Bale size (h×w×l) | 750×1100×1200 mm | 750×1100×1200 mm |
| Wire around the bale | 30 600 mm (19 500 +11 100) | 30 600 mm (19 500 +11 100) |
| Wire for tying | 4 800 mm (3000 + 1800) | 4 800 mm (3000 + 1800) |
| Wire for pigtails | 1 600 mm (1000+600) | 4 800 mm (3000+1800) |
| Total wirelength/bale | 37 000 mm (37 m) | 40 200 mm (40.2 m) |
| Difference | -3200 mm (-3.2 m) |
So here, the difference is 3.2 meters of wire per bale. The Medium company’s bales weigh an average of 500 kg, which means that it produces 80,000 bales per year and 1.2 million bales in 15 years.
Medium – wire cost 15 years
| Presona LP 85 VH2K | Shear baler 165 kW | |
|---|---|---|
| Number of bales 15 yrs | 1 200 000 | 1 200 000 |
| Meters of wire 15 yrs | 44 400 000 | 48 240 000 |
| Wire cost 15 yrs | €2 220 000 | €2 412 000 |
| Money saved | €192 000 |
Choosing a baler with an efficient tying mechanism saves you €192,000 (almost the price of a completely new baler) in 15 years!
Large company
In the Large company, the bales are larger than in previous examples: 1100 (h) × 1200 (l) mm, which gives us a wire length of 23,000 mm + knot wire of 3000 mm, a total of 26,000 mm excluding pigtails.
Large – wire usage per bale
| Presona MP 270 MH | Shear baler 300 kW | |
|---|---|---|
| Bale size (h×w×l) | 1100×1100×1200 mm | 1100×1100×1200 mm |
| Wire around the bale | 23 000 mm | 23 000 mm |
| Wire for tying | 3000 mm | 3000 mm |
| Wire for pigtails | 1000 mm | 3000 mm |
| Total wirelength/bale | 27 000 mm (27 m) | 29 000 mm (29 m) |
| Difference | -2000 mm (-2 m) | |
Here, the bales weigh an average of 900 kg, which means that the large company produces 222,222 bales (200,000,000/900) per year and 3,333,300 bales (15 × 222,222) over a 15-year period.
Large – wire cost 15 years
| Presona MP 270 MH | Shear baler 300 kW | |
|---|---|---|
| Number of bales 15 yrs | 3 333 330 | 3 333 330 |
| Meters of wire 15 yrs | 89 999 910 | 96 666 570 |
| Wire cost 15 yrs | €4 499 996 | €4 833 328 |
| Money saved | €333 332 |
In this example, €333,332 can be saved during the lifetime of the machine.
Expenditure that does not affect the evaluation (very much)
Staff
The cost of personnel is usually the largest single expense of operating a baler. People are needed to fill the conveyor belt with material, remove finished bales and handle and maintain the machine. However, when we calculate the life cycle cost to compare balers, the cost of personnel is not that important. The amount of material to be loaded onto the conveyor belt is the same regardless of which baler is used. In these examples, we assume that the balers have approximately the same level of automation. All in all, this means that the amount of personnel and thus the personnel cost is generally the same regardless of the machine.
Note that this does not apply if you compare the cost between buying, for example, two smaller balers or a larger one. Each baler needs its own staff, conveyor belts, front loaders, and so on. Personnel costs are always lower if you choose one larger baler instead of multiple smaller ones.
Maintenance
Regular maintenance is vital to avoid unplanned outages and give the baler a long life. The machines in our examples have similar service needs. For that reason, we decided not to include this cost in our evaluation. However, a general tip is to make sure that you have a service partner who is geographically close to your facility. That way, the service partner can remedy urgent problems quickly, and there will be fewer travel hours to be paid.
Repairs
It is difficult to calculate the cost of unexpected repairs precisely because they are unexpected. The best way to avoid them is to buy good quality balers and follow the service recommendations. Therefore, we do not include repair costs in our calculations when we evaluate balers.
Wear parts
Wear parts are things on a baler that are expected to wear and should be replaced at regular intervals. These are, for example, blocks under a press carriage or the shear on a shear baler. The cost over 15 years is relatively small, so we omit it from our calculations when evaluating balers.
Financial costs
Cost of capital employed must, of course, also be included in the analysis. However, we omit them here when we evaluate balers because the purchase prices, and thus the capital costs, do not differ much.
Divestment
Once the machine has done its job in your company, it’s time for divestment. Maybe the baler has a value in the used market and can be sold, or maybe it’s time to sell it for scrap.
Costs associated with divestment are:
- Dismantling
- Transport of the baler from your facility
- Costs of sale (warehousing, possible brokerage fee, etc.)
- Cost of scrapping
Summary – save this much on baler costs!
It’s time to sum it all up! By buying a baler that has low operating costs, you can save a lot of money. As you will see in the tables below, you can buy one or more new balers for the money you save.
Here we present the life cycle cost (purchase price, energy cost, wire cost) for the three example companies. (As we said before, there are other costs, but since they are quite similar no matter which machine you choose, we haven’t taken them into account.)
Small – baler life cycle cost
| LP 60 | Shear baler 75 kW | |
|---|---|---|
| Purchase price | €165 000 | €140 000 |
| Energy cost (Germany) | €144 286 | €292 471 |
| Wire cost | €528 750 | €573 750 |
| Total cost 15 yrs | €838 036 | €1 006 221 |
| You save: | €168 185 |
Medium – baler life cycle cost
| LP 85 VH2K | Shear baler 165 kW | |
|---|---|---|
| Purchase price | €250 000 | €212 500 |
| Energy cost (Germany) | €861 459 | €1 579 342 |
| Wire cost | €2 220 000 | €2 412 000 |
| Total cost 15 yrs | €3 331 459 | €4 170 830 |
| You save: | €872 383 |
Large – baler life cycle cost
| MP 270 MH | Shear baler 300 kW | |
|---|---|---|
| Purchase price | €700 000 | €600 000 |
| Energy cost (Germany) | €3 534 192 | €4 417 740 |
| Wire cost | €4 499 996 | €4 833 328 |
| Total cost 15 yrs | €8 734 188 | €9 851 068 |
| You save: | €1 116 880 |
The numbers speak for themselves! Do not stare blindly at the purchase price! Instead, calculate what operating costs will be throughout the life of the machine. It pays off. I promise, no matter what balers you compare!
Try our calculator!
We have built a calculator to help you choose between balers.
Jesper Hultqvist
Marketing guy at Presona. Likes to create customer value through information and digital services. Dog owner and fly fisherman.
