What do refined resources cost?

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ยท@beelzaelยท
32.490 HBD
What do refined resources cost?
![Screenshot taken from an occupied shard mine plot, writing from me.](https://files.peakd.com/file/peakd-hive/beelzael/23ynN5A1TQyxiNUsoVZdQWh8BzwQLNUPK6AWfjdm96WeFqjWCDre2sW4WjDPQcmos4cZn.png)


   
  
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 #### Prologue
  
While I still creep around with my 5 plots and produce only natural resources, I'm already thinking about my master plan for expansion. Prices are dropping, so there are some deals on the market - and the next boost for land will come. Hence, I need to have my strategy in place, and that includes working on refined resources (RR).

If we treat Praetoria like real life fpr a second, we can use the "normal" business theory of 30-30-10-30 as parts of price set on a product. 30% are cost of ingredients (in this case, grain for natural resources, or natural resources for RR), 30% work cost (cost for cards and staked DEC comes to mind), 10% is the fix cost (plots) and 30% should be profit. 

In this post, I want to see how that would work out for Praetoria at the moment, reviewing strategies for SPS and Midnight Potions, starting witht he latter.
  
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 #### Settings

Let's say we don't produce any resources, nor grain, but buy anything on the market. We only need one plot than, which we will use for the according resource. 

Also, to make things easier to calculate, we will have 10k production points, 5 GF from the Chaos Legion set, with the production boost of 10%, excluding the 10% for taxes.

Death and Fire are currently the cheapest of those cards, for around 16 cents per BCX, so $6,10 per card, $30,50 total. Badlands can host hose nicely, $17 for the plot. $5 for the power core. $50 for staking.

Total: $102,50
___

**Technical of the Plot:**

Production points: 10,000 * 1,1 (boost) * 0,9 (tax) = 9,900 PP

Grain per hour: 100, translates to 0,889 DEC/h
  
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 #### Midnight is coming!

To produce Midnight Potions, we need Aura, to produce Aura, we need a Permit, got get a Permit, we need Research, to get Research, we need a lab. The lab costs us 50,000 PP = 500 Grain = 4,48 DEC.

[Research Tutorial - Click here](https://support.splinterlands.com/hc/en-us/articles/18072745438484-Research-FAQ)

>For every 10,000 PP a landowner devotes to research, they will receive 1 research token (minus 10% for taxes).

>0.005 Wood, 0.002 Stone, and 0.0005 Iron are consumed per production point per hour. Research Hut Workers also consume 0.01 Grain per production point per hour.

We already deducted the tax from our total PP, so we produce a net of 0.99 Research per hour for the cost of 

- 100 Grain
- 50 Wood
- 20 Stone
- 5 Iron

At current prices, that's <u>5.45 DEC per Research Point</u>.

For the 10k Research, we will accordingly need: 

- 1,010,101.01 Grain
- 505,050.5051 Wood
- 202,020.202 Stone
- 50,505.05051 Iron

*Yes, I only copied those numbers because they look funny. Don't stone me!*

Short: A total of <u>55,042 DEC</u> for the 10k needed for the Aura Lab. And over 400 days. Just saying to emphasize that **THIS IS A SIMULATION!**
___

Cost so far: 102,500 DEC + 4,48 DEC + 55,042 DEC = <u>157,546.48 DEC</u>

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###### Aura is up!

We have the permit, let's build the lab. Same cost to build, 4,48 DEC. 
[Aura Tutorial - Click here](https://support.splinterlands.com/hc/en-us/articles/36813082132244-Aura-FAQ)

>Aura production is 0.0005/hour, the same rate as iron. 

>Aura Labs require the same grain, wood, stone, and iron inputs as Research Huts and Shard Mines. 

Very good. In order to create a midnight potion, we need 40 Aura. 0,0005 Aura/PP/h brings us to a production of 4,95 Aura per hour. The cost for that is at 5,45 DEC/h, just like for 1 Research as PP is the same. 

It takes us a little over 8h and 44 DEC to produce 1 potion. We can produce 2,97 Potions a day, or 1,085 Potions per year. That makes a total cost of 47,735 DEC per year.



![image.png](https://files.peakd.com/file/peakd-hive/beelzael/48FmV6ZWM9YfGcsb27upYTi5pUzJoiPEonwptwCa79A4uKaJsPZGF2t5rDWjWB7eFf.png)


If we consider the investment and calculate for 1 year, the cost per potion would be (157,546 DEC + 48,180 DEC) / 1085 Potions = 189 DEC/Potion. But in the second year it would be already down to 116,7 DEC/Potion. It falls slower from there, naturally in somewhat exponential functions.




  
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 #### But where's the profit?

Nowhere to be found. At least not with our setting. It's impossible to make profit with Midnight Potions at the moment, even when only considering the production cost. 

At current prices, selling a Midnight Potion creates a loss of 19 DEC, a minus 43%. It makes more sense to sell the natural resources, for now.

![image.png](https://files.peakd.com/file/peakd-hive/beelzael/23tbHAHxMd1t45PDEcr8aGfpXQneykdghpybeQUb89CmnL3DPhd5QHk2sPaGJJeVEWYrk.png)

##### WHY?????

Boosts. I double checked my math, and it adds up. Then I went to the wonderful BLT and searched for my always favorite show-case, Azircon. Here's the deal:

![image.png](https://files.peakd.com/file/peakd-hive/beelzael/23tGTqrFt3JZppnMaPYiUQJQMbyKMjBjgnQFmGR5RYPB4AMWgAv7i3pULBdxpcBUV4ZW8.png)

The base aura production would be only 73,3 Aura/h. But with all the boosts (Runi, Title, Totem), it goes up to almost 240 Aura/h, which makes it profitable. 

I would still argue that it makes more profit to put all the boosts on Stone, though.

https://images.hive.blog/0x0/https://files.peakd.com/file/peakd-hive/saydie/23tSMrBK495yadzSKriVB9FkEtftyayqE76JDxWPJsATmCdvqi8G8tHKVfT9SQ4p8MEBX.png

 #### SPS

Okay, I did not want to do this, but since I already was on Azircon's stat page, here's a deduction from his stats:


![image.png](https://files.peakd.com/file/peakd-hive/beelzael/AJg2awCrVCkf12WfxHRC6p47xC19ZYUFyefP1FJBSZ37ohXjGkNFk8hr2jCJY7h.png)

14.414 SPS for 408,818 boosted PP = 3,82 SPS for 108,300 Base SPS = 0.35 SPS per 10,000 PP = <u>2.8 DEC/ 10,000 PP / h</u>

Cost: 5,45 DEC/h

Again, a loss of around 45%. I did not factor in the 10% terrain bonus, but that doesn't really change too much here.

  
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 #### Conclusion

If my math is right, neither SPS nor Aura/Midnight potions are the way to go for my strategy. Sure, that all might shift with upcoming new sinks, but I don't know that yet. For now, it doesn't make sense to me. 

That comes also with the fact that I do not have any boosts. So, the next post will probably be about exploring the different boosts and all that. Maybe then it will make more sense ๐Ÿ˜…


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Former posts:

[Calculating Land part 1 - How to get your ROI](https://peakd.com/hive-13323/@beelzael/i-just-cant-make-land-work-post-looks-huge-but-most-is-math)
[Calculating Land part 2 - Are pools worth it?](https://peakd.com/splinterlands/@beelzael/a-jump-into-the-pool-making-sense-of-land-part-2)
[Calculating Land part 3 - Organic Growth](https://peakd.com/hive-13323/@beelzael/just-another-land-math-monday-making-sense-of-land-part-3)
[Land Plot Efficiency for non-whales](https://peakd.com/hive-13323/@beelzael/land-plot-efficiency-for-non-whales)
[Card-Production-Coefficient - Combining LPE and ROI](https://peakd.com/hive-169191/@beelzael/lpe-and-roi-unite)
[Renting for Land - at what cost?](https://peakd.com/hive-169191/@beelzael/renting-for-land-at-what-cost)
[Risks to my strategy](https://peakd.com/hive-169191/@beelzael/what-could-go-wrong)


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Thank you very much for reading, I hope you enjoyed it at least as much as I enjoyed writing :-D If you have any comments or feedback - please let me know! And don't forget to leave your own posts for me to curate. Thank you very much!

If you don't play the game yet, you can use my referral: [Click here for referral :-)](https://splinterlands.com?ref=beelzael)
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