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The risks and chances of investing mining machinery

Posted on August 18, 2012 04:44 AM, in nicole009py

The risks and chances of investing mining machinery

Through a comparative analysis on the development of mining & quarrying equipment  industry in 31 provincial regions and 20 major cities in visualized form of data map, the report provides key data and concise analyses on the mining & quarrying equipment mfg. industry in China, a list of top 20 enterprises in the sector as well as the comparison on investment environment in top 10 hot regions. In addition, the report truly reflects the position of foreign enterprises in mining & quarrying equipment mfg. industry across China based on a comprehensive comparison of operating conditions among different enterprise types. This report is based on Chinese industry classification (Industrial Classification For National Economic Activities, GB/T 4754-2002).
Additionally, by original creation ofDistribution Index, the report directly shows the difference in various regions of Mainland China in terms of mining & quarrying equipment mfg. industry, providing an important reference for investors' selection of target regions to make investment.
What will you get from this report?
First, our work contains both silver explorers and silver producers and thus they cannot really be compared exactly. Notice that the producers sell at a much higher market capitalization per ounce than the explorers. There are several reasons for this, first a mine has great capital expenditure involved in the roads, buildings, machinery, housing, power and water systems. Additionally, in most cases the exploration costs were higher because the project had to be taken to feasibility and the mine put into production.This brings us to another important factor, are we looking at an open pit situation or are we looking at an underground mine? An open pit mine can be easier to put into production and far less capital intensive than an underground mine.
Another factor that I have seldom seen discussed is rate of production. Specifically, in an underground mine how many ounces are pulled up out of the shaft in a 24 hour period? This is important because some companies like to brag about huge resources and yet the mineshaft only allows a certain quantity of ore to come to surface. Now having a large resource is important but if you have a tremendous quantity of silver underground but can only bring an extremely small amount of it to surface your income statement will reflect that fact and your stock price may stall out leaving investors that do not understand the dynamics of mining confused.

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Tags: the, risks, and, chances, investing, mining, machinery

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