RE: Refining? - CoachHi Littleguy!
I doubt there is anything to be concerned about regarding bottlenecks at smelters. In fact, what I have heard is exactly the opposite: Asian based smelters are bidding to buy concentrate from smaller mines just to keep up with demand, and are paying more for the cons than the local Penoles smelters in Mexico. So far the incremental mine production has been very small relative to capacity and unless some very large projects commence production, I doubt that will change.
I have heard that some companies negotiated deals where the shipping costs to overseas smelters is subsidized. So the net effect on the bottom line is minor, although the company may face exposure to spot market volatility between the time that the concentrates are loaded on to the ship, and the arrival of the cons several weeks later before the revenues are booked. I guess it is up to each company to negotiate the best deal they can after considering all the options open for shipment.
Keep in mind that environmental laws may be very different overseas from what the standards are in North America, and it is my understanding that the ore from Nuestra Senora has very low levels of arsenic, cadmium, and other nasty contaminants. Therefore a local smelter may be willing to pay a premium to buy the concentrates. It is a sellers market.
cheers!
COACH247