Nonmetallic Mineral Mining & Quarrying
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Industry Overview
The nonmetallic mineral mining and quarrying industry in the US includes about 3,300 companies with annual revenues of about $22 billion. Major companies include Vulcan Materials, Martin Marietta Materials, and subsidiaries of foreign firms such as Lehigh Hanson and Oldcastle Materials. The industry is fragmented, with many small firms serving local geographic markets.
China and India have the largest nonmetallic mineral reserves in the world. Lime, zeolites, asbestos, and garnet are the world's most highly mined minerals. Large nonmetallic mining companies outside the US are Rio Tinto (United Kingdom), DeBeers (South Africa), HeidelbergCement (Germany), and CRH (Ireland).
Competitive Landscape
Demand is driven by construction spending and agricultural spending on fertilizers. Large companies have some economies of scale in purchasing and administrative systems, and have the production volume to supply large construction projects, such as new highways. Small companies typically own just one mine and compete in a local market based on superior customer service.
Imports of nonmetallic minerals account for about 5 percent of the US market. Major sources of imports include Canada, Saudi Arabia, Venezuela, Iraq, and Mexico. US exports, mainly to Canada, Japan, China, Mexico, and Germany, represent about 5 percent of domestic production.
Products, Operations & Technology
Major products include crushed and broken limestone (35 percent of revenue), construction sand and gravel (20 percent); crushed and broken granite (10 percent); potash, soda, and borate (5 percent); kaolin and ball clay; and phosphate rock (each less than 5 percent). Other products include gypsum, bentonite, clay, and other broken stone. Phosphates and potassium salts are used to make fertilizers. Crushed stone, sand, and gravel are also referred to as aggregates.
Most quarries are open-pit mines where the surface is blasted to reach stone mineral and stone deposits. Benches are cut in to the walls to enable access to deeper deposits. The rock is blasted from the mine face, loaded into trucks, and carried to the primary crusher, which breaks it into smaller pieces. These smaller pieces are carried to the surface by conveyor and sorted by size. The aggregate is then transported to customers, usually by truck. Some mines further process onsite, whereas smaller mines may ship the aggregate to third-party processing facilities. Processing includes further crushing, sorting, washing, and leaching.
Transportation costs can exceed the price of products, so aggregates typically supply local markets. While aggregates have traditionally been transported by truck, some companies also use railroad cars, and to a lesser extent, barges. Publicly funded projects, such as road, airport, and municipal building construction, can account for as much as 50 percent of aggregates sales. Fluctuations in energy costs can also influence aggregate prices significantly.
Mines and quarries can be quite large, but their use depends on local demand. Each year hundreds of mines are idled, closed, or abandoned and hundreds more opened or reactivated. The changing locations of construction and highway projects drive these decisions. Environmental regulations require companies to return abandoned quarries back to their original look and use.
Research and development expenditures are small, generally less than 1 percent of revenue.
