What role do ore grades and feedstock quality play in materials gross margin?

In mining, the grade of the ore being extracted determines how much metal is recovered per ton of rock moved, which directly sets the unit cost of production. Higher grades mean fewer tons, less energy, and less processing to produce the same output, which translates into a wider gross margin at any given metal price. Chemical and paper producers face a parallel dynamic around feedstock quality and location. Over long horizons, asset quality is often the single most durable driver of gross margin differences among peers.

Why are basic materials gross margins so cyclical?

The products sold are commodities, which means realized prices are dictated by global supply and demand rather than by any single producer. When demand tightens and prices rise, the fixed cost base of a mine or mill is overwhelmed by the revenue expansion and gross margin widens sharply. When prices fall, the same cost base crushes the margin and can push firms below breakeven. This is structural to the industry and is why cycle-through-cycle margin discipline, not any single year, tends to be the more useful lens.

Top Basic Materials Stocks by Gross Margin

Top basic materials companies ranked by gross margin, latest annual filings.

What Gross Margin Means for Basic Materials Companies

Gross margin in basic materials is the spread between realized commodity prices and the direct cost of extracting, smelting, or processing the output. Miners, chemical producers, steelmakers, and paper-and-packaging firms all sit in this sector and share a common trait: they market largely undifferentiated products whose prices are set by global markets. That makes ore grades, energy inputs, and plant utilization the primary drivers of how much margin survives direct production costs.

Why It Matters in Basic Materials

Gross margin in this sector is a read on ore quality, operational efficiency, and input-cost positioning. A producer with richer ore, lower-cost feedstock access, or newer integrated facilities earns a wider spread at any given commodity price. It is worth noting that reported gross margin is extremely sensitive to the price cycle, and also that inventory accounting, byproduct credits, and royalty structures differ across firms, which complicates like-for-like peer comparison.

What to Read Alongside

Pair gross margin with Revenue to size the commodity-cycle backdrop, Operating Margin to include corporate overhead, and Free Cash Flow because capital intensity varies enormously across mining, chemicals, and paper subsectors.

Data as of FY 2025 78 companies Rhea AI

#	Symbol	Company	Sector
1	RGLD	Royal Gold, Inc.	Basic Materials	69.32%	$18.48B
2	NEM	Newmont Corporation	Basic Materials	64.33%	$111.09B
3	SSRM	SSR Mining Inc.	Basic Materials	59.91%	$5.87B
4	SHW	The Sherwin-Williams Company	Basic Materials	48.85%	$88.22B
5	LIN	Linde plc	Basic Materials	48.83%	$225.93B
6	CTVA	Corteva, Inc.	Basic Materials	47.29%	$51.28B
7	SSD	Simpson Manufacturing Co., Inc.	Basic Materials	45.85%	$7.96B
8	ECL	Ecolab Inc.	Basic Materials	44.46%	$79.46B
9	HL	Hecla Mining Company	Basic Materials	43.72%	$10.65B
10	ESI	Element Solutions Inc.	Basic Materials	41.96%	$9.37B
11	RPM	RPM International, Inc.	Basic Materials	41.44%	$14.76B
12	PPG	PPG Industries, Inc.	Basic Materials	41.32%	$26.04B
13	NGVT	Ingevity Corporation	Basic Materials	39.53%	$2.66B
14	CF	CF Industries Holdings, Inc.	Basic Materials	38.45%	$17.70B
15	IFF	International Flavors & Fragrances Inc.	Basic Materials	36.16%	$21.57B
16	CRH	CRH Public Limited Company	Basic Materials	36.13%	$64.97B
17	KWR	Quaker Houghton	Basic Materials	35.97%	$2.88B
18	JHX	James Hardie Industries plc	Basic Materials	35.77%	$16.25B
19	BCPC	Balchem Corporation	Basic Materials	35.74%	$5.75B
20	DD	DuPont de Nemours, Inc.	Basic Materials	34.50%	$19.45B
21	AXTA	Axalta Coating Systems Ltd.	Basic Materials	34.43%	$8.03B
22	SXT	Sensient Technologies Corporation	Basic Materials	33.45%	$5.47B
23	SOLS	Solstice Advanced Materials, Inc.	Basic Materials	32.17%	$9.88B
24	NEU	NewMarket Corporation	Basic Materials	31.46%	$8.21B
25	APD	Air Products & Chemicals, Inc.	Basic Materials	31.41%	$66.79B
26	AVNT	Avient Corporation	Basic Materials	31.15%	$3.91B
27	FUL	H.B. Fuller Company	Basic Materials	31.11%	$3.18B
28	MLM	Martin Marietta Materials, Inc.	Basic Materials	30.72%	$32.33B
29	SMG	The Scotts Miracle-Gro Company	Basic Materials	30.59%	$3.61B
30	WLKP	Westlake Chemical Partners LP	Basic Materials	29.81%	$0.75B
31	RS	Reliance, Inc.	Basic Materials	28.74%	$21.35B
32	EXP	Eagle Materials Inc.	Basic Materials	28.27%	$6.48B
33	IOSP	Innospec Inc.	Basic Materials	27.69%	$2.25B
34	VMC	Vulcan Materials Company	Basic Materials	27.38%	$36.49B
35	AMRZ	Amrize Ltd	Basic Materials	25.68%	$28.35B
36	CBT	Cabot Corporation	Basic Materials	25.32%	$4.52B
37	HCC	Warrior Met Coal, Inc.	Basic Materials	25.01%	$4.73B
38	MTX	Minerals Technologies Inc	Basic Materials	24.99%	$2.34B
39	KOP	Koppers Holdings Inc.	Basic Materials	23.83%	$1.01B
40	HWKN	Hawkins, Inc.	Basic Materials	22.61%	$2.71B
41	SLVM	Sylvamo Corporation	Basic Materials	21.93%	$1.50B
42	EMN	Eastman Chemical Company	Basic Materials	21.07%	$8.40B
43	CE	Celanese Corporation	Basic Materials	20.45%	$4.82B
44	OEC	Orion S.A.	Basic Materials	19.91%	$0.43B
45	KNF	Knife River Corporation	Basic Materials	18.35%	$3.83B
46	MATV	Mativ Holdings, Inc.	Basic Materials	18.26%	$0.64B
47	MTRN	Materion Corporation	Basic Materials	17.27%	$5.80B
48	AA	Alcoa Corporation	Basic Materials	16.94%	$12.53B
49	UFPI	UFP Industries, Inc.	Basic Materials	16.77%	$5.07B
50	BCC	Boise Cascade Company	Basic Materials	16.46%	$2.94B
51	MOS	The Mosaic Company	Basic Materials	15.78%	$7.46B
52	CC	The Chemours Company	Basic Materials	15.53%	$2.27B
53	CMP	Compass Minerals International, Inc.	Basic Materials	15.33%	$1.08B
54	VHI	Valhi, Inc.	Basic Materials	14.22%	$0.45B
55	CSTM	Constellium SE	Basic Materials	14.05%	$3.88B
56	HUN	Huntsman Corporation	Basic Materials	13.21%	$1.78B
57	STLD	Steel Dynamics, Inc.	Basic Materials	13.16%	$37.48B
58	KALU	Kaiser Aluminum Corporation	Basic Materials	13.12%	$2.80B
59	ALB	Albemarle Corporation	Basic Materials	13.00%	$14.80B
60	NUE	Nucor Corporation	Basic Materials	11.93%	$61.95B
61	WS	Worthington Steel, Inc.	Basic Materials	11.71%	$1.89B
62	SCL	Stepan Co.	Basic Materials	11.57%	$1.45B
63	KRO	Kronos Worldwide, Inc.	Basic Materials	11.46%	$0.95B
64	ASIX	AdvanSix Inc.	Basic Materials	10.84%	$0.54B
65	CENX	Century Aluminum Company	Basic Materials	10.14%	$4.55B
66	AMR	Alpha Metallurgical Resources, Inc.	Basic Materials	9.62%	$1.93B
67	TROX	Tronox Holdings plc	Basic Materials	9.28%	$1.11B
68	LYB	LyondellBasell Industries N.V.	Basic Materials	8.55%	$19.85B
69	MTUS	Metallus Inc.	Basic Materials	8.21%	$0.89B
70	RYAM	Rayonier Advanced Materials Inc.	Basic Materials	8.10%	$0.62B
71	CLW	Clearwater Paper Corporation	Basic Materials	7.43%	$0.37B
72	OLN	Olin Corp.	Basic Materials	7.40%	$2.14B
73	WLK	Westlake Corporation	Basic Materials	7.28%	$9.90B
74	GPRE	Green Plains Inc.	Basic Materials	6.55%	$1.06B
75	DOW	Dow Inc.	Basic Materials	6.34%	$21.89B
76	CLMT	Calumet, Inc.	Basic Materials	5.94%	$3.65B
77	TSE	Trinseo PLC	Basic Materials	5.58%	$0.01B
78	MERC	Mercer International Inc.	Basic Materials	4.93%	$0.05B

How this ranking is built

Companies are ranked by gross margin as reported in their most recent annual filing with the SEC. Figures shown are in US dollars (or percent, as noted), rounded to two decimals.

Source: annual 10-K / 20-F filings from companies trading on US exchanges (NYSE, Nasdaq, AMEX).
Fiscal year: whichever annual period the company has most recently filed. Fiscal years don't always align with the calendar year, so the "as of FY" stamp above reflects the most common year across the table.
Filtered out: warrants, preferred shares, and duplicate listings that share a parent company's financials.
Update cadence: refreshed as companies file new annual reports (typically within 60–90 days of fiscal year end).

Not financial advice. This is a research tool, not a recommendation.