Cash costs, in mining, are the costs of production, at site level, per unit of output.
Cash costs include operational cash costs at site level. This:
- includes transport, refining and administration costs and royalties
- excludes non-cash costs such as depreciation and amortisation
- excludes costs not at site level (such as head office costs).
The value of the by-products is deducted from the final cash cost of the metal. For example, if a copper mine produces gold as a by-product, then the value of the gold produced will be deducted from the cash cost of the copper. This is the usual accounting treatment for by-products in most industries.