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Mining Cutoff Grades

Joined
27 April 2006
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I am new to both this forum and trading in general. I have been heavily researching the commodities area but am getting confused with different grades of different metals. I am wondering if anyone knows what cut-off grades are for each particular metal and the difference between the low and high grades. metals of particular interest are

zinc
copper
lead
aluminium
uranium
gold

if anyone has any thoughts or input would be appreciated. im sure there are a few other begginers who would appreciate this as it would help greatly in assessing the value of mining companies interests.
 
A cut off grade defines what you will mine for a profit.
It will vary for every mineral, for every location, and reflect geological conditions and prevailing metals prices.
For example, you can mine surface gold grading much less than a gram per tonne and make a profit, but you would not touch 2 grams per tonne a few kilometres down because it would be too expensive.
As the prevailing metal prices rise, the cost of extracing metals from lower grade ore bodies becomes less of an issue.
As a result, copper mines that were once too expensive are now being opened up, while nickel ore bodies that would never be touched at $15,000/tonne are now being mined at $20,000/tonne.
You need to do a fair bit of homework on every company, and then every mine, to determine what's good and what is not - I have not discovered any short cuts in the last 5 years, so if there is anyone who has a better idea, please come forward.
 
I found this article on the World Gold Council website
http://www.gold.org/value/markets/faqs/index.html

This section of the article is relevant to this thread regarding gold grades


So in regards to a decent gold grade it depends on type of mine and cash cost of extracting the gold.

For an open pit mine grades as >1 g/t is profitable. So an open pit mine with 3-4 g/t would be significant.
 
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