The Impact of Country of Origin on Equipment Capital Costs

Many variables must be considered when making equipment purchase decisions.  Most of those variables, such as equipment types, sizing, features, preferred manufacturers, and operating costs are obvious considerations in the process.  For example, production demands will have a significant impact on equipment sizing. 

What about capital cost?  On the surface, this may also seem like an obvious and straight-forward variable to consider, but the recent U.S. tariffs imposed on China underscore that it isn’t as simple as balancing the capital cost with the desired features or preferred manufacturers. A single equipment manufacturer may utilize facilities in multiple countries based on parts costs and availabilities, labor availabilities, or manufacturing capacity.   This means that pricing structures within those companies may not be uniform, even within a single product category.    

To demonstrate, we can consider one contributor to the 2019 update of CostMine’s Mine and Mill Equipment Guide. This contributor, a leading supplier of mining equipment across the globe, provides a total of twenty-five (25) data points annually.  For 2019, all of their non-Chinese manufactured equipment pieces saw a modest 1.5% increase in prices, while Chinese manufactured equipment saw a much more significant 15% increase.  Only three (3) of the twenty-five (25) machines in our guide are manufactured in China, so the equipment procurement process now demands the question of capital cost, followed by the question of country of origin.  In some instances, alternative equipment selections may be required.   

Mine & Mill Equipment Costs: An Estimator’s Guide

This guide includes both Capital Costs and Hourly Operating Costs for over 3,000 pieces of equipment commonly found in mines and mills around the world, from $500 slusher buckets to $50,000,000 walking draglines.  Published October 2019.

Included are mobile and stationary equipment for surface and underground mining, reclamation and processing of coal, metals, and industrial minerals. 

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