I have not had much success recovering much usable material from aluminum chips. My furnace is electric.(Electric Crucible Furnace Update) My crucible, a 9" piece of 4" Sch 40 steel pipe with a steel bottom welded on. a It holds about 9 pounds of melted alum with out spilling all over. I tried reclaiming about 20 pounds of chips. I began by packing the pipe with as much of the chips as I could pound in. During the melt there was a lot of "smoke" or fumes, I am guessing from residual cutting fluids etc. I should add, the chips were mostly from machining castings from pops cans. I only get about 6-7 pounds of ingots from 10 pounds or cans.
I was expecting the chips to fall as they melted, but they did not move much at all. Using my stir rod, 3/8" rebar. I poked at the chips, they were just a spongy mass. It did shrink a little and I added more. I got very little liquid aluminum from what I tried to melt. The process, as I tried it, was not successful at all.
I am thinking the thin chips were mostly oxidized aluminum from the heat of machining which I am unable to convert to usable casting allow.

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