Question

If fructose costs $1/kg, and we can convert 50% of it to HMF at a cost...

If fructose costs $1/kg, and we can convert 50% of it to HMF at a cost of $5/kg HMF, calculate the potential operating profit if HMF wholesales for $100/kg, and we produce 100,000 kg HMF/yr.

Engineering   Chemical-Engineering   
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Answer #1

Basis 1 kg of fructose

Cost of fructose = $1

Convert 50% fructose to HMF

After conversion

HMF produced = 0.5 kg

Cost of HMF Produced = $5/kg x 0.5 kg = $2.5

Total cost of 0.5 kg HMF produced = cost of 0.5 kg fructose converted + cost of 0.5 kg HMF produced

= $0.5 + $2.5 = $3.00

Total cost of 1 kg HMF produced = $6.00

Wholesale Rate of 1 kg HMF = $100

Operating profit for 1 kg HMF = 100 - 6 = $94.00

Operating profit for a year

= 100,000 kg HMF/yr x $94.00/kg

= $9400000/yr

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