Pricing Formulas & Payability for Ore
Use this page as a reference when drafting offtake contracts or evaluating offers. Each ore family uses an industry‑accepted formula that converts assay → payable metal → net price.
1 General structure (simplified)
Net Pay = (Payable metal × Reference price) ± Penalties/Bonuses – Moisture deduction
Payable metal already reflects treatment‑ and refining‑cost realities (they are baked into the payability percentage).
Reference price = LME, LBMA, Fastmarkets, etc. (USD assumed).
Penalties / bonuses adjust cash value for impurities or by‑product credits.
Need the math done for you? → Use our Payability Calculator (Tools section).
2 Why TC/RC still matter
Smelters quote Treatment & Refining Charges (TC/RC) in their own models. Traders typically convert those dollar costs into lower payability percentages, so the contract stays one‑line simple. When you see “90 % payable Sb,” remember the hidden TC/RC that drove it.
3 Antimony Ore & Concentrate (Sb₂S₃)
| Parameter | Typical contract term |
|---|---|
| Payable % | 90 % of contained Sb when Sb ≥ 45 %; sliding scale 85–90 % (35–45 %). |
| Reference price | Fastmarkets MB 99.65 % Sb ingot, CFR China. |
| Penalties | As > 0.50 % → US $3 per 0.1 % over; Pb > 0.5 % → US $2 per 0.01 %. |
| Moisture limit | 10 %. Excess moisture deducted weight‑for‑weight. |
Worked example
Lot: 45 % Sb concentrate, 1 000 wet t, 6 % H₂O, As 0.18 %.
Dry t = 1 000 × (1 – 0.06) = 940 t
Contained Sb = 45 % × 940 = 423 t
Payable Sb = 90 % × 423 = 380.7 t
Gross value (50 500 $/t) = 380.7 t × 50 500 $ = 5 139 k$
No As penalty (below threshold)
Net Pay ≈ 5.139 M $
4 Gold Ore / Concentrate
| Term | Gravity / oxide ore | Flotation conc. |
|---|---|---|
| Payable Au | 95 % | 90–95 % (grade‑linked) |
| Deductions | 1 g/t free | 1–2 g/t free |
| Penalties | As, Sb, Hg fees by schedule | Higher Hg penalty in conc. |
Reference price = LBMA p.m. fix (USD).
5 Copper Concentrate (25–30 % Cu)
Typical payability shorthand:
Pay Cu = 96.5 % – (1 unit)
Gold credit: 95 % payable, 1 g/t free
Silver credit: 90 % payable, 30 g/t free
Impurity penalties for As, Pb, Hg …
Smelter TC/RC values are embedded inside those pay percentages.
6 Lithium Spodumene 6 % (SC6)
| Payable Li₂O | 98 % at 6 %; +/- pro‑rata 0.1 % steps |
| Reference | Fastmarkets Spodumene 6 %, CIF China |
| Grade premium | ± US $15 /t per 0.1 % Li₂O |
| Penalties | Fe₂O₃ > 0.8 % → US $5 /t per 0.1 %; Moisture > 9 % = weight deduction |
7 $/DMT vs $/PMT — what’s with the jargon?
$/DMT = dollars per Dry Metric Tonne — moisture removed. Critical for ores shipped with variable H₂O.
$/PMT = dollars per Physical (or Provisional) Metric Tonne — the wet weight loaded. Contracts using DMT keep moisture maths transparent.
8 Key take‑aways
Payability % already embeds TC/RC; the simplified net‑pay formula needs only payable metal, price, penalties, and moisture.
Quote impurity penalties outside payability so both parties see the cash hit per extra 0.01 % As, Hg, etc.
Use DMT units when moisture can shift ≥ 0.5 % between lots.
(Updated June 2025)