Background
Crushed
stone is one of the most
accessible
natural resources, and is a
major basic
raw material used by
construction,
agriculture, and other
industries. Despite the low
value of its basic products, the
crushed stone industry is a
major contributor to and an
indicator of the
economic well-being of a nation.[3]
The demand for crushed stone is
determined mostly by the level
of construction activity, and,
therefore, the demand for
construction materials.[4]
Stone
resources of the world are very
large. High-purity
limestone and
dolomite suitable for
specialty uses are limited in
many geographic areas. Crushed
stone substitutes for
roadbuilding include
sand and
gravel, and
slag. Substitutes for
crushed stone used as
construction aggregates include
sand and gravel, iron and steel
slag,
sintered or expanded
clay or
shale, and
perlite or
vermiculite.[5]
Crushed
stone is a high-volume,
low-value
commodity. The industry is
highly competitive and is
characterized by many operations
serving local or regional
markets. Production costs are
determined mainly by the cost of
labor, equipment, energy, and
water, in addition to the costs
of compliance with
environmental and
safety regulations. These
costs vary depending on
geographic location, the nature
of the deposit, and the number
and type of products produced.
Despite having one of the lowest
average by weight values of all
mineral commodities, in the
United States the constant
dollar price of crushed stone
has changed relatively little
during a recent 20 year period.
As a result of rising costs of
labor, energy, and mining and
processing equipment, the
average unit price of crushed
stone increased from
US$1.58 per metric ton,
f.o.b. plant, in 1970 to US$4.39
in 1990. However, the unit price
in constant 1982 dollars
fluctuated between US$3.48 and
US$3.91 per metric ton for the
same period. Increased
productivity achieved
through increased use of
automation and more
efficient equipment was mainly
responsible for maintaining the
prices at this level.[4]
Transportation is a major
factor in the delivered price of
crushed stone. The cost of
moving crushed stone from the
plant to the market often equals
or exceeds the sale price of the
product at the plant. Because of
the high cost of transportation
and the large quantities of bulk
material that have to be
shipped, crushed stone is
usually marketed locally. The
high cost of transportation is
responsible for the wide
dispersion of quarries, usually
located near highly populated
areas. However, increasing land
values combined with local
environmental concerns are
moving crushed stone quarries
farther from the end-use
locations, increasing the price
of delivered material.
Economies of scale, which
might be realized if fewer,
larger operations served larger
marketing areas, would probably
not offset the increased
transportation costs.[4]