Alchemy is a complicated process that combines two materials in order to make small quantities of a more valuable substance. Explaining it to an unfamiliar reader is going to take a little bit of work, so please bear with me as I take you through it. Also, be aware that this is an expensive project, moreso than basic moon mining. There is more at risk here than investing in a battlecruiser blueprint and, though the profits are appropriately higher, this will not be for everybody.
In short, alchemy is a special process that takes basic moon materials and combines them to make small quantities of a more valuable material, and also returns a small portion of the ingredients as a byproduct. The process takes place at a "POS" and essentially represents an alternative way to produce high-end materials, that are further reacted and eventually used to make advanced materials for tech two ships and modules.
In a previous article, I dealt with a tutorial of how to set up POSes and anchor structures there to be used. If you are unfamiliar with how POSes function, please read that article first.
In an alchemy reaction, a POS runs a Silo containing one ingredient, and a second silo that contains a second ingredient. These are then combined in a Simple Reactor Array that contains the alchemy reaction blueprint. The reactor produces an unrefined version of the product into a third silo. That product is then taken to a station and refined, resulting in a small quantity of the desired product, and a larger amount of one of the ingredients, as a byproduct that may be re-used.
Instead of a silo, it is possible to substitute a Moon Harvester for one or both of the ingredient inputs, assuming that the moon contains the correct materials. If a decent moon is available, it is possible that this may be the best way to profit from it, rather than selling the raw mined materials on the market.
Note that the Unrefined Fluxed Condensates reaction is an exception to the general rule, and does not produce a byproduct.
An industrialist decides that he wants to make Dysporite. He sets up a medium Gallente Control Tower, and anchors three silos and a simple reactor array. He puts the Unrefined Dysporite Reaction blueprint into the reactor array and puts it online. This particular reaction requires 100 Cadmium and 100 Mercury per hour, so he fills one silo with Cadmium, and a second silo with Mercury. These silos are then connected to the reactor, and the final silo set up to receive the Unrefined Dysporite that will be produced.
Voila, everything is in place. Each hour, the reactor takes 100 Cadmium and 100 Mercury out of their respective silos, and puts a single unit of Unrefined Dysporite into the third silo. The unrefined product may be removed to a station, where a character with good skills will be able to refine it into 40 Dysporite and 95 Mercury (less station refining taxes). The Dysporite can then be removed to Jita for sale, and the Mercury re-used at the POS.
The process may be expressed as follows: 100 Cadmium + 100 Mercury --> 40 Dysporite + 95 Mercury.
The History Of Alchemy
Alchemy was introduced by CCP in the midst of a period of great market inflation, when it seemed likely that a single coalition could conceivably gain control of the majority of Dysprosium and Promethium moons in the game. Until the recent Dominion expansion, these two moons were the key to making any tech two goods. Before Dominion, the price of these two moon materials determined the price of t2 ships, modules, ammunition, and various other goods. They were an unavoidable bottleneck in the production chain, subject to market manipulation, the whims of nullsec alliance leaders, and vulnerable to monopolies.
Unlike earlier cartels on certain tech two goods, that occurred before CCP introduced invention to bypass the tech two blueprint holders, a near monopoly on those two moons would affect every single tech two module and ship in the game. Eventually, this might even make tech two goods inaccessible to large portions of the game.
Thus, before it happened, CCP acted and introduced alternative means of producing the goods that Promethium and Dysprosium were used to make. Alternative ways to make other, less rare materials were introduced as well, to act as a hedge against a similar thing happening to them.
With the Dominion patch, tech two goods are less prone to bottlenecks amongst advanced materials. Alchemy receives a buff to the amount of products, however, keeping certain kinds of Alchemy very profitable, indeed.
Normal Reactions Vs. Alchemy
Normal moon material reactions combine equal amounts of two moon materials into a product, called an intermediate material. That product is then reacted with other materials to make advanced materials. These can then be used with blueprints to make tech two components. Those can then be used with invention blueprint copies to make tech two modules and ships.
The process of running a reaction requires several POS, and is difficult to understand even for advanced players. Because maintaining multiple POS is so labor-intensive, entire corporations can be based around producing a single advanced material, and the reactions involved with it. Many reaction ingredients are so expensive when bought in Jita that reacting them occurs at a loss, unless a moon containing an expensive ingredient is available to be mined, rather than purchased. Sound complicated and unpleasant? It is. I stay away from reactions.
In contrast, Alchemy only involves two ingredients. Because most alchemical reactions yield a large amount of byproducts, it is very easy to buy the cheaper ingredient and re-use it, if a decent moon is available. Maintaining a single POS is easy enough for a single casual player to handle, and is a wonderful source of passive income because the reaction takes place whether you are logged in or not, so long as the POS is fueled and the ingredients are available.
The Business Model
The value of alchemy products are subject to rapid and chaotic fluctuations. What is without value one day, may be coveted the next. Often, goods are hoarded in order to increase their market value. Other times, a person that has been hoarding may decide that it is time to turn a profit, and dump a huge amount onto the market, driving the price down overnight.
With that caveat, I will suggest to you a business model that is profitable at present. It may become less profitable if many people try it. If things really change, it may even operate at a loss, as several alchemy reactions do. So remain constantly aware of the cost of your ingredients, and the value of your product.
The basic idea here is that, having done the math, I find reacting Dysporite to be the most profitable alchemy reaction at this time. Let me take you through what is required.
Refining Your Product
If you are refining in an NPC station, this means that you need a character that has trained (at minimum) Refining V, Refinery Efficiency IV, and Cybernetics III. With special refining implant installed, you can get nearly 100% efficiency in an NPC station (less taxes). You also need standings to be as high as possible in order to avoid having the NPC corporation that controls the station taxing you. Having corporate standings of 6.67 or higher with a station owner is sufficient to avoid taxes entirely.
If you don't know how to plug in an implant, it's very simple. Open your training queue and pause your skills for a moment, then right click on the implant and select "Plug In." The implant in question here is the awkwardly titled "Hardwiring - Zainou 'Beancounter' H50" which runs for about 25mil and adds a +2% bonus to refining. There exist other versions that only give a +1% bonus (the H40, which runs for 1.2mil) and an expensive version that adds a +4% bonus to refining yield (the H60, which runs for over 100mil).
If you are refining at a player-controlled outpost in null-sec, the base refining amounts can be much lower. In order to get a perfect refining of your product, you must train Refinery Efficiency to V, and Scrapmetal Processing to IV. This is a rather intensive skill regimen, but market mavens often train this in order to get the best yield from from purchased modules that can be converted to minerals at a profit. Finding someone in your corporation that you trust to refine for you may be more practical if you have not trained these skills, and do not wish to. Also note that player corporations will almost always tax even their own members, so there may not be a way to avoid taxes if you are refining at an outpost. Because the unrefined product is so small, it may be to your advantage to fly it to empire rather than deal with player-set taxes. This carries the disadvantage of not having the byproduct be located near your alchemy tower.
General Shopping List
Here is what you will need for a basic mining and reaction POS:
- 1 Gallente Control Tower Medium (200mil)
- 1 Simple Reactor Array (11.25mil)
- 3 Silos (13.5mil each, 40.5mil total)
- 1 Unrefined Dysporite Reaction (blueprint, .9mil)
- 30,000 Cadmium (~36mil)
- 30,000 Mercury (~48mil)
You must also keep your tower fueled. Consult my other article for the varieties of fuel needed, but note that medium towers consume roughly twice as much fuel, per hour, compared to a small. They can store a correspondingly larger amount as well, though. Note that if you are reacting in high security space, you will require starbase charters as an additional variety of fuel, depending on where you are anchoring it. E.g. if you are anchoring your tower in a Caldari region like The Forge, you would need a Caldari State Starbase Charter as an additional variety of fuel. Don't worry, they aren't that expensive.
The Cadmium and Mercury are best purchased in Jita, where the vast majority of moon products are bought and sold.
If you have read the second part in my series on moon mining, you should already know the basics of setting up a POS and the various structures. Getting the silos to connect to the reactor is very similar to setting up a moon harvester's relationship to a silo. Anchor the silos, open the processes tab in the POS management window, and change their types to Cadmium, Mercury, and Unrefined Dysporite, respectively. Put them online. Anchor the reactor but do not online it, and approach it until you are within 2000 meters. Right click on it and access its contents, then drag the Unrefined Dysporite Reaction blueprint into it. Open the processes tab in the POS management window, and drag the icon to the right of each ingredient silo onto the appropriate icons located to the left of the reactor. Then drag the Unrefined Dysporite icon to the right of the reactor onto the blank space to the left of the Unrefined Dysporite silo. Online the reactor and hit the 'Apply' button at the bottom of the processes window. If everything is working correctly, once the reactor is online, it should indicate that it is starting up in red text.
Let's Do It
The above goods cost over 336mil isk, plus the price of fuel. A hefty investment, but one that should pay for itself in about two months. The math is as follows:
Each hour that your POS should cost about 140,000 isk in fuel (a general rule of thumb for medium POS). Each hour it will consume 100 Cadmium and 100 Mercury, costing approximately 282,000 isk, total. Thus, each hour that your POS is online and producing, it is costing 422,000 isk in materials.
Each hour, your POS will produce a single unit of Unrefined Dysporite, amounting to 40 Dysporite and 95 Mercury with a perfect refine and no taxes. That amount of Dysporite is worth about 560,000 isk, and the Mercury byproduct is worth about 128,000 isk, for a total of 688,000 isk goods produced, per hour.
Even if you lose 5% of the product to taxes, that's still about 230,000 isk profit, per hour. That's 5.5mil per day, or 165mil profit per month. Thus, in two months you will be seeing a profit. If ever you tire of the business, and have not had your POS blown up, you can resell that to recoup much of your investment. Alternatively, you may sell the POS as-is, set up on the moon, to another member of your corporation. Or even sell the corporation itself, if you're the CEO. I bet a fella could make a lot of isk setting these up and reselling them.
I hope this has made alchemy a little clearer to you, and that your head isn't spinning. If you are ambitious enough to try this, please be sure to let me know how it goes. If you have any questions or issues, feel free to post on the Ten Ton Hammer forums and I will see if I can help you out.[protip]
- For your Reference, here is a list of all the Alchemy Reactions currently in EVE Online:
- Dysporite (Cadmium and Mercury)
- Ferrofluid (Cadmium and Hafnium)
- Fluxed Condensates (Vanadium and Platinum)
- Hyperflurite (Chromium and Vanadium)
- Neo Mercurite (Platinum and Mercury)
- Prometium (Cadmium and Chromium)