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If I recall correctly the lube is melted in the pan, bullets put in molten lube and then lube is allowed to cool off/harden thus "lubing" the bullets, once lube re-hardens the cutter is used to remove said bullets from the lube, shave off excess lube and I presume ready to load. Never got into the casting/lube stuff myself.
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I started with that kit. I started casting in the mid '80s and was on a budget. I found one of the 44 cal kits on ebay, used and IIRC I payed $5.00 + shipping for it. The pan had an unknown red lube that worked OK for my 44 Magnum loads. Worked fine and I used it for several hundred bullets before I got the Lee push through kit...
I have one of those Lee Lube and size kits when I first started casting for 357 Mag. back in the early 80s Still have the sizer, but no clue where the cutter and pan are at.