Ice mining sell direct or manufacture fuel blocks?

I just cant seem to make the math work. Perhaps it is the genes that have been passed down but still…

It seems selling the raw compressed blocks in all cases makes far more profit than refining even at the best of stations/implants and combining with PI products to build fuel blocks based on what they are selling for…

This doesnt seem right–what would be the incentive to ever produce fuel blocks which do have a high demand?

What am i missing

I didn’t do the math either, but I think the thing you’re missing is: Location.

If you’re in an area deep in null space, or in a wormhole, I suppose it becomes much more worthwile to create the fuel locally instead of importing it.

i am asking about high sec space. i see tons and tons of fuel blocks and people mining/producing but the math seems to be a negative sum game.

especially when the cost per compressed ice comes out higher than the end products

Chances are it’s easier to haul compressed ice and build blocks locally, so compressed is more valuable.

Items to not have a set price. People may be importing the PI from somewhere else where it’s cheaper. People may be using uncompressed ice mined locally and bought for less than the compressed version. People may be producing the fuel blocks elsewhere and haul them to wherever you are to sell them at that market (although I doubt that, but I don’t dabble in market or trading so I may be wrong).

If you notice that something is not worth producing for you, that’s a good sign you shouldn’t produce it. But because EVE’s prices differ between regions in space, it may be profitable for someone else.

Or they may be lazy and don’t bother to check the up-to-date prices while producing fuel even at times when it’s running at a loss.

This same topic came up last year, for your reading enjoyment:

Very easy: if inputs are more expensive than outputs then simply stop making that darn thing.
Also as was foretold - the shutting down of many moon mining athanors is causing drop in fuel demand. Things may change in few weeks (end of May/start of June) due to Forsaken Fortress patch.

Ok you are right i was given this patch notes today. I was not aware that all high sec citadel and structures would be removed soon so now I see why price drop.

Thanks

Nothing is being removed. Just that most athanors in hisec where anchored for ores and not moon goo - hence once regular ore was gone most went into low power or is sold / reprocessed. End result is decrease in fuel consumption.

A lot of fuel blocks are manufactured by people who mine the ice and harvest the PI. Their cost is their time. The possibility of selling the raw materials at a higher price may not have been considered - or maybe they enjoy making stuff and don’t care about profitability - Eve is, after all, a game.

It´s a persistent problem in every MMO with the characters that does both, recollecting and manufacturing.

Many of these tend to think that since they recollect their own resources, they are free, so they are content with a price below market costs.

It is a dumb mindset and not everyone is dumb, but there´s engough of them to keep the picture as you see it: Manufactured products at cost, or even a bit lower.

you need to get your formula straight.

  1. You work with enough runs to make the data meaningful.
  2. you have to know if you place orders to SO for Long Term (LT) , or to BO for Short Term (ST).
  3. you need to have an idea of the volumic price of the items you sell, that is the price to ask someone to move them to the trade hub. If it’s you you also need to pay yourself for the trip. 100isk/m³ is good, but you can take less, or more, depending on your distance.
  4. you need to know which items you produce and which one you purchase from the hub, in order to get their price from the hub
    • if you are producer of an item, then the price of that item is the price you would sell it, minus the taxes, minus the volumic price.
    • if you are consumer of an item, then the price of that item is the price you would buy it, plus the taxes, plus the volumic price.
  5. you need to get your system cost index, and taxes, to get your job gross cost. Also add a base price from starting a job, and a hourly price for the manufacturing queue in isk/h of production. You choose those.
  6. add your margin . eg if you want to make 10% margin, you multiply the total cost by 100/(100-10) ; add the hub taxes depending on the amount of time you accept to move the order (% = brokerfee(×1+0.25×relists)+hub taxes)
  7. if THAT price is worse than the one in the market, then sell your raw products, building is not worth your time.

A few years ago I recall a corpmate complaining that his buy order for a T2 module was filling slowly and that was delaying his project. I pointed out that he was offering roughly half current production cost so why would anyone sell to him?

Nothing has changed, buy orders typically offer less than current material cost. let alone invention and assorted taxes. None the less, people do sell to buy orders and a lot of market activity is arbitrage trade where people are buying and selling the same product in the same market profitably. Selling prices for T2 items in Jita are frequently less than the cost of materials to make them in the same market.

Some of this is stockpiled product manufactured when costs were lower, some is hangar cleanup where you really don’t care about the price and some is people who are bad at math. None the less, it is possible to run a profitable business manufacturing and selling these items. Under price product is not a large percentage of total volume and it tends to sell quickly so the market spends most of its time in a profitable range.

CCP doesn’t want you to make ISK playing the game, that is what their RMT via PLEX is for. You’re supposed to mine ice for the “content” nothing more.

It is a dumb mindset and those players should be banned for life from playing game.

Sometimes, as I showed on my previous post, it’s actually a correct formula. Some material can be not worth moving to a hub because the hauling cost is too high.

They can be a by product of another activity, eg modules from missions can be reprocessed. loot from kills also. They can be excess from your PI production, that you know you will never need.
In that case, and assuming the volume of the product is lower, they can be considered as free in the production formula.

Stop the mathing! You’re making my head hurt. You dont work for NASA or something do you?

dude that’s just basic math.

I oversimplified a lot, because you should not take the price from the market. Those “prices” you use should actually consider the volume that is sold on the hub, the quantity you intend to use, the tendency of the market over the last week, as well as making a harmonic regression to consider cycling effect over the last year (for the volume of trade, the number of items sold at BO, the number of items sold at SO, etc).

Also your cost index should have a lower value because if you craft a lot you will raise up to that value(typically in sqrt(manufacturing jobs available) )

That was just a gross evaluation of what is required to ensure you make profits. Devil is in details.

Of course nothing forces you to do all of that. You can accept a loss in precision, but then you need to bound that precision loss in order to increase your cost by that precision.

I was joking.

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