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Glossary
Mineral resources segment and
Smelting & refining segment
Troy ounce (toz)
other metals chemically bonded to
The troy ounce is the standard unit of
sulfur. Since the application of heat
Metal trading
weight for precious metals such as gold
breaks these bonds, releasing the
London Metal Exchange (LME)
and silver. It equals approximately 31.1
sulfur, such ores are generally refined
The LME specializes in trading of non-
grams. It is named after Troyes, a city in
using pyrometallurgical techniques.
ferrous metals such as copper, nickel,
the Champagne region of central France
aluminum, lead and zinc. The LME
that was the site of a major market in
Oxide ores
trading prices for metals are used as the
Europe in medieval times. Originally used
These ores contain metals in oxidized
international pricing benchmarks for
as a unit of exchange for valuing goods
forms. Unlike sulfide ores, oxides need
sales of refined metal and purchases of
in terms of gold or silver weights, the troy
much more energy to achieve melting.
refining ores.
ounce is still used today in gold trading.
For this reason, the hydrometallurgical
approach is generally used to refine
TC/RC
Metal refining
Treatment Charge (TC) and Refining
Smelting and refining
Charge (RC) are commonly used in the
Refining processes extract valuable
Copper concentrates
terms of purchase for copper concen-
metals from ores or other raw materials.
Used as raw materials in copper smelting,
trate or nickel ore for refining. They are
They fall into two basic types: pyromet-
copper concentrates have a copper
amounts designed to cover refining
allurgical (dry) and hydrometallurgical
content of about 30% by weight. The
costs. For example, copper concentrate
(wet). At SMM’s Toyo facilities in Ehime
remainder consists mostly of sulfur and
contracts may define a purchase price
Prefecture, the copper concentrate
iron. Copper concentrates are made
based on the LME price at a certain
preprocessing undertaken at Saijo uses
mostly from sulfide ores. Ores extracted
date, minus the TC or RC being used at
pyrometallurgical processes and the
from overseas mines have a typical
the time.
nickel refining at the Niihama site uses
grade of about 1%. The ores are then
these ores.
hydrometallurgical processes entirely. The
“dressed” at the mine to increase the
London fixing
term ‘smelting’ is used for the extraction
purity and produce concentrate. Most
Gold is not traded on the LME. Its price
of metal from ores using melting and
of the copper ores imported by SMM
is determined for each transaction
heating (pyrometallurgy). The term
for smelting in Japan are concentrates.
between market participants. The
‘refining’ refers to any process that
financial institutions in the London
increases the grade or purity of a metal.
Bullion Market Association (LBMA)
Nickel oxide ores
Whilst the higher-grade sulfide ores are
agree on a standard price for gold based
Pyrometallurgical refining
used predominantly in nickel refining,
on these transactions and publish it on
The precursor ore is melted at high
nickel oxide ores are more prevalent
the morning and afternoon of each
temperature in a furnace, and refining
than nickel sulfides. The sulfide-oxide
trading day. This “London fixing” price
techniques are applied to separate the
ratio in current nickel reserves is believed
is the benchmark for trading in gold.
metal in a molten state.
to be about 3:7. High refining costs and
technical issues have limited use of oxide
Pound (lb)
Hydrometallurgical refining
ores in nickel refining to date, but SMM
Part of the imperial system of measures,
The ore and impurities are dissolved in
has succeeded in refining nickel from
the pound is the standard unit of weight
a solution, and chemical reactions are
low-grade oxide ores based on HPAL
used in measuring and pricing base
used to separate out the metal.
technology.
in TC/RC calculations. One pound is
Metal ores
Mixed sulfide (MS) ores
equal to 453.59 grams; an imperial ton
Sulfide ores
CBNC produces a mixed nickel-cobalt
equals 2,204.62lb.
These ores contain copper, nickel or
sulfide intermediate containing about
metals such as copper and nickel, and
80 | SUMITOMO METAL MINING CO., LTD. Annual Report 2012
60% nickel by weight. This is used as
Matte Chlorine Leach Electrowinning
a raw material in electrolytic nickel
(MCLE)
Copper-clad polyimide film (CCPF)
production.
MCLE is the technology used in the
CCPF is a polyimide film that is coated
manufacturing process at SMM’s nickel
using a copper base. It is used as a
Matte
refinery. The matte and mixed sulfide
material for making COF substrates.
A matte is another term for metal
ores are dissolved in chlorine at high
sulfides. For raw material, electrolytic
pressure to produce high-grade nickel
Chip-on-film (COF) substrates
nickel production at SMM also uses a
using electrolysis. MCLE is competitive
COF substrates are electronic packaging
nickel matte (of about 75–80% purity)
in cost terms, but poses significant
materials used to make integrated
sourced from P.T. Vale Indonesia.
operational challenges.
circuits for LCD drivers. They connect
Materials segment
these circuits to the LCD panel.
Proprietary ore ratio
Main applications for metals
This ratio is the proportion by volume
Copper
Leadframes (L/F)
of ore procured from overseas mining
Copper is fabricated into wires, pipes
Leadframes are electronic packaging
interests relative to the overall volume
and other forms. Besides power cables,
materials used to form connections in
of smelting ores used as raw materials.
copper is used widely in consumer
semiconductor chips and printed circuit
Typically, off-take rights are proportional
applications such as wiring in vehicles or
boards. They contain thin strips of a
to the equity interest in a mine. In the
houses, and in air conditioning systems.
metal alloy containing mostly nickel
case of Cerro Verde, SMM has secured
or copper.
50% off-take rights for the first ten
Electrolytic nickel
years of production from 2006, based
This form of nickel, which has a purity
Secondary batteries
on a 21% equity interest.
of at least 99.99%, is used in specialty
Secondary batteries are ones that can
steels, electronics materials and electro-
be recharged and used again. SMM
Nickel production process
plating, among other applications. SMM
supplies battery materials that are used
Coral Bay Nickel Corporation (CBNC)
is the only producer of electrolytic nickel
in the anodes of nickel metal hydride
Based in the Philippines, this SMM
in Japan.
batteries and lithium-ion rechargeable
subsidiary produces mixed nickel-cobalt
batteries, which supply power for
sulfides using HPAL technology and
Ferronickel
hybrid vehicles or notebook computers,
exports the raw materials to the SMM
Ferronickel is an alloy containing nickel
among other consumer applications.
Group’s nickel refining facilities in
(about 20%) and iron. Its main use is
Niihama, Ehime Prefecture.
in the manufacture of stainless steel,
which is about 10% nickel by weight.
High Pressure Acid Leach (HPAL)
Based in Hyuga, Miyazaki Prefecture,
HPAL technology enables the recovery
SMM Group firm Hyuga Smelting
of nickel from low grade nickel oxide
produces ferronickel.
ores that traditionally were difficult to
process. SMM was the first company in
Gold
the world to apply it successfully on a
Gold is in demand worldwide for
commercial scale. The oxide ores are
investment and decorative purposes.
subjected to high temperature and
Gold is widely used in industry within
pressure and reacted under stable
the electronics sector because of its
conditions with sulfuric acid to produce
high malleability and ductility.
a nickel-rich refining intermediate.
SUMITOMO METAL MINING CO., LTD.
Annual Report 2012
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