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In the fall of 1993, cups being produced at Buffalo China developed a mysterious crack at the handle, turning them into scrap before they left the factory.

"We lost quite a bit of money while it was happening," said Nikolas J. Ninos, director of research and development. Without cups, sales of the company's dinnerware stalled.

Ninos called on faculty at his alma mater, Alfred University's College of Ceramics, to help solve the mystery that threatened the 600-worker company. Out of that effort grew the Whiteware Research Center at Alfred.

Producers of porcelain or "whiteware" typically break 15 percent to 20 percent of their output before it leaves the factory. By conducting studies that can cut waste, the research center in Allegany County is helping Buffalo China and other employers sharpen their competitiveness in the face of rising imports, companies and researchers said.

"There's a perception that the technology is mature, but if that was true, we wouldn't be in business," said William M. Carty, director of the Whiteware Research Center.

In addition to Buffalo China, the center's members include Victor Insulators in Victor and Lapp Insulator Co. in LeRoy. Since its founding six years ago, the center has doubled its roster to 16 members, who underwrite its $500,000 annual budget.

Although several of its member companies compete against each other, the center steers clear of industrial battles, officials said. Research on basic subjects like the physical properties of clay can help several members without giving one an advantage. With about 10 researchers, the center has funded more than 20 research projects since it was founded, on topics such as the optimal firing schedules and clay's molecular properties.

"We're all working with the same raw materials," said Michael J. Dempsey, ceramic engineer at Victor Insulators. "Basically, it's dirt."

The $4.5 billion whiteware market accounts for about 12 percent of the ceramics industry in the United States, according to estimates tracked by the American Ceramics Society in Columbus, Ohio.

But domestic makers are losing ground to an onslaught of imports. U.S. produced dinnerware, for example, accounts for 27 percent of the market, down from 32 percent in 1991, according to the Ceramics Society. Domestic producers face rivals on two fronts, with low-cost producers in Asia and high-end producers of fine china like Spode in Europe.

Porcelain products range from dinner plates to sanitary plumbing fixtures, but the technology to make them is similar. Clay is mixed with finely ground quartz and other ingredients, shaped, then baked at temperatures over 2,000 degrees. The result is a strong, waterproof and corrosion-proof material that lends itself to insulating an electrical current -- or to holding hot foods and liquids.

"People have been making plates for a thousand years -- Buffalo China's been making them for 100 years," said Ninos. "There's a lot of know-how, but what we found was, there's not a lot of "know-why.' "

Why, for example, did the company's cups start splitting apart in 1993?

Researchers at Alfred traced the crack to overly large quartz particles in the raw material, Carty said. Quartz gives porcelain its glass content. But the particles that should have been about the width of a human hair were five times that. When they expanded in heating, they produced structural flaws that turned the cup to scrap.

Today, Buffalo China tests each batch of clay as it comes in the door -- and during processing. Losses in some processes have been cut to under 10 percent, Ninos said.

Basic research into the chemistry of porcelain has also permitted the company to modify processes to use less expensive ingredients. By investing $180,000 in processing equipment, Buffalo China saves $150,000 annually in materials costs, he said.

"It used to be that the body formula was like the formula for Coca-Cola -- it was locked up and closely guarded," he said. But as knowledge about clay grew, the focus has shifted from a secret recipe approach to managing chemical trade-offs.

Insulator companies face a similar set of problems for a very different product -- giant tubers of ceramic used on high capacity power lines.

The porcelain shapes made at Victor Insulators can be a foot wide and more than three feet tall, Dempsey said. Products require "firing" cycles in a kiln of four or five days, much longer than required for plates. Losing a product late in its production cycle means a substantial energy loss as well as labor and material costs.

"Despite the best efforts of our suppliers, there are dramatic inconsistencies in raw materials," he said. "It's not uncommon to have 80 or 85 percent yields."

Victor Insulators traces its roots back to telegraph operator Fred Locke, who invented porcelain insulators in 1894 after finding that wood and glass tended to fail in wet weather. The company operates now on the spot in Victor where Locke's factory was built.

But the industry's history doesn't guarantee it a future. One manufacturer in Columbia has achieved yields of about 95 percent, Dempsey said. And while imports of insulators are low today, the production standards for electrical equipment are nearly the same throughout North and South America.

While porcelain makers may never match other manufacturers' yields of better than 99 percent, "it's certainly possible to get in the upper 90s," Dempsey said.

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