COMPARATIVE COSTS OF NICKEL SULFIDES AND LATERITES

Although relative production costs of nickel from laterite and sulphid e deposits have changed during the period 1988 to 1994, cash break eve n costs of the average sulphide producer remain below those of the ave rage laterite producer, Sulphide producers have higher direct producti on costs but lower net production costs because of significant byprodu ct credits, However, total costs, which include capital, are now equal for the average laterite and sulphide producers, Relative production costs have been influenced by simultaneous yearly changes in byproduct and nickel prices, oil prices and exchange rates as well as real chan ges in actual production, transport and capital investments, In the ab sence of major shifts in energy or byproduct prices, the average sulph ide producer will continue to experience lower cash operating costs ga ined through capital investments than the average laterite producer, T his suggests that the average nickel sulphide operation is more able t o withstand cyclic nickel price downturns.