Nonmetallic Mineral Mining and Quarrying (United States)

A Histometrics investor primer · NAICS 2022 code 2123 — the rollup of three child industries

NAICS (the North American Industry Classification System, the U.S. government's standard code for an industry) code 2123 — Nonmetallic Mineral Mining and Quarrying — is the four-digit industry group that gathers every U.S. operation mining minerals that are neither a fuel (coal, oil, gas) nor a metal ore. It sits inside Sector 21 (Mining, Quarrying, and Oil and Gas Extraction) → Subsector 212 (Mining except Oil and Gas) → this group, and it splits into three child industries: 21231 (stone), 21232 (sand, gravel, clay, and ceramic/refractory minerals), and 21239 (other — the chemical and fertilizer minerals). This primer synthesizes the three child-industry primers beneath it and is written for both public-market investors (listed producers, diversified materials and mining groups, sector funds) and private investors (family/private-equity operators, and owners of mineral and royalty rights). Figures are U.S.; data vintages are noted throughout. [1][2][3]

The one idea to carry through this primer. 2123 is not one industry — it is a spectrum stretching from crushed rock to lithium. At one end sit the construction-aggregate businesses (stone, sand and gravel) — cheap, heavy material whose price is set by freight, so each pit is a local price-maker with a gentle cycle and near-zero energy-transition risk. At the other end sit the chemical and fertilizer minerals (phosphate, potash, soda ash, salt, borates, lithium) — sold at globally set prices, so those producers are price-takers on a violent commodity cycle, several of them tied to farming, energy, or batteries. The middle child straddles both worlds, because it holds construction sand and the frac sand pumped into shale wells. One code, three business models, three ways to invest. [1][5][6][7][8][9][10]

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1. Overview

Nonmetallic mineral mining is, by tonnage, the largest mining complex in the United States — far larger than coal or metals — even though its dollar receipts are modest. In 2022 the group booked $36.33 billion of receipts across 2,460 firms, and in 2023 it ran 5,293 establishments (pits, quarries, and plants) employing 90,102 people with a $7.42 billion payroll — about $82,000 of pay per worker, well above the private-sector average, the signature of skilled, capital-heavy, continuous-process mining. [2][3]

The reason an investor should care is that this one code contains three genuinely different bets, and confusing them is the most common error in the sector:

• Stone (21231) — ~49% of receipts — is overwhelmingly a construction-aggregates business: crushed limestone, granite, and traprock whose economics are set by freight, not a national price. Prices grind higher almost every year, even in recessions; the cycle shows up in volumes. Near-zero transition risk. This is where most of the clean public-market investability lives. [5][8][9]
• Sand, gravel, clay, and ceramic/refractory minerals (21232) — ~35% of receipts — is itself a spectrum: construction sand and gravel (a freight-moated local-pricing business like stone), industrial "frac" sand (a high-beta bet on shale drilling), and clay (a defensive, diversified specialty-minerals business). [4]
• Other nonmetallic minerals (21239) — ~16% of receipts — is the chemical-and-fertilizer-minerals bucket: phosphate, potash, soda ash, rock/brine salt, borates, and brine lithium. These are global commodity price-takers — leveraged bets on world prices, several of them on the U.S. "critical minerals" list. [4]

Ways in.

• Public markets: aggregates producers (most cleanly Vulcan Materials and Martin Marietta), diversified building-materials groups, a thinned-out field of frac-sand names, one real specialty-clay name, and the fertilizer/lithium/salt producers. There is no pure-play nonmetallic-mining exchange-traded fund (ETF, a basket security that trades like a share) — every route is bundled or diversified. [8][9][12][15][16]
• Private markets: direct or private-equity (PE) ownership of a long fragmented tail of operators across all three children, and ownership of the mineral and royalty rights under a pit or mine (a per-ton or percentage royalty as material is extracted). [13][17][24]

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2. What's inside — the three child industries, and how they differ

2123 contains three children. The table below is the heart of this primer: it is where they genuinely diverge — on size, commodity, who the customer is, how the price behaves, who owns the assets, and how you invest.

The contrast table

*Share of group by 2022 Economic Census receipts and 2023 County Business Patterns employment. Rows may not sum to 100% due to rounding. HHI = Herfindahl-Hirschman Index, a 0–10,000 national-concentration score where below 1,500 is "unconcentrated." Sources: [2][3][4][5][6][7][8][9][10].

The six contrasts that matter

1. Relative size — and a labor mismatch. Stone is nearly half the group; sand/gravel/clay is a third; chemical minerals is a sixth. But employment tilts differently: 21239 is ~16% of revenue yet only ~11% of jobs — a tiny-headcount, high-capital, continuous-process business (~43 workers per site, ~$100k average pay), whereas sand/gravel/clay is ~35% of revenue but ~41% of the jobs and nearly half the sites, because it is a swarm of small pits. [2][3][4]

2. The master split: local price-maker vs. global price-taker. This is the deepest divide in the group. Stone and construction sand and gravel are freight-limited local businesses — a heavy, cheap ton cannot travel more than ~25–50 miles economically, so each pit is a price-maker inside its haul zone, and prices rise even through recessions. The chemical minerals in 21239 are the opposite: no U.S. producer sets the world price of phosphate, potash, soda ash, or lithium, so those owners are price-takers whose margin is the thin, swinging residual between a globally set price and a largely fixed cost base. The middle child (21232) contains both — construction sand behaves like stone, while its frac sand behaves like a global energy commodity. [5][8][9] · [4]

3. Price behavior. Construction rock (stone + sand and gravel, ~70% of the whole group) shows sticky-to-rising prices and cyclical volumes — U.S. crushed-stone value climbed from ~$12.69/ton (2020) to ~$18.50/ton (2025 estimate) even as tonnage softened. Frac sand is boom-bust (price fell ~16% in 2025 on oversupply). Chemical minerals swing violently with world prices — the largest U.S. phosphate miner's net sales nearly halved from 2022 to 2024 on roughly flat volumes, and lithium prices fell ~80%+ from their peak. [5] · [4]

4. Concentration inverts intuition. The smallest child is the most concentrated: 21239 (HHI 674) because its sub-markets — phosphate, potash, soda ash, boron — are each tight oligopolies of a handful of firms. The aggregates children are the most fragmented (stone HHI 341; sand/gravel/clay HHI 102). The group HHI is just 137.9 — dragged low by the enormous fragmented aggregates base — so nationally this looks like one of the least concentrated corners of mining. But that national number hides the truth in every direction: aggregates are locally concentrated (a town may have two deliverable pits), and the chemical minerals are nationally concentrated market-by-market. [2][4]

5. Land tenure and royalties. The aggregates children sit almost entirely on private or state land, where local zoning is the binding constraint and there is no federal production-royalty regime. The chemical minerals are different: phosphate, potash, and sodium (salt/soda ash/trona) are leasable under the Mineral Leasing Act of 1920, so much of that output comes from federal ground where the U.S. Treasury collects a production royalty (~2–5%) — while lithium remains locatable (claimed, historically royalty-free) under the General Mining Law of 1872. One group; two entirely different federal-land regimes. [18][20]

6. Energy-transition exposure spans the full spectrum. Stone, construction sand and gravel, and clay carry near-zero stranded-asset risk — roads, foundations, grids, and data centers consume rock under every decarbonization scenario. Frac sand is the loser corner — its demand is ~81% tied to shale completions. And parts of 21239 are transition winners — brine lithium and lithium-iron-phosphate (LFP) battery chemistry open new demand for lithium and phosphate. So within one four-digit code you can find a transition-neutral business, a fossil-fuel-exposed one, and a battery-materials one. [5][6] · [4]

A note on the code's boundary. All three children capture extraction and beneficiation only (mining plus physical prep — crushing, washing, screening, concentrating). The far larger downstream manufacturing steps sit in other codes: burning limestone into cement or lime, sawing stone into countertops, and — critically — a phosphate miner's fertilizer plant or a lithium chemical-conversion plant (all in Sector 325/327 manufacturing). That is why a company's results never match the "2123" figure: the biggest dollars at a Mosaic, a Nutrien, or a Vulcan sit in the downstream links, not the mining link. Keep the frames labeled. [1]

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3. How big it is

Two federal yardsticks measure two different universes. Both are correct; keep them separate — mixing them is the most common error in reading this group.

3a. The business (U.S. Census Bureau — our ground truth for 2123)

CBP (County Business Patterns) is the annual employer-business series (counts, employment, payroll — no revenue); the Economic Census is the five-year revenue and concentration benchmark. Our ingested ground truth for 2123 provides these figures — but not a group-level physical tonnage, reserve total, unit value, or per-industry SBA (Small Business Administration) size standard, because those are not defined at this level. Where this primer needs physical or price data it draws on the U.S. Geological Survey (USGS) commodity series (§3b) and says so honestly.

The rollup is internally consistent. Because every establishment carries exactly one primary code, the children's 2023 CBP figures sum cleanly to the parent: 2,440 + 2,617 + 236 = 5,293 establishments, and 43,124 + 36,740 + 10,238 = 90,102 employees — both exact. Payrolls reconcile ($3.41B + $2.96B + $1.05B ≈ $7.42B), and 2022 receipts reconcile ($17.72B stone + $12.84B sand/gravel/clay + $5.77B other ≈ $36.33B). One honest exception: firm counts do not add up — the three children list 2,562 firms (969 + 1,437 + 156) but the parent shows only 2,460, because a single firm operating in more than one child is counted once at the group level (~102 firms de-duplicated). [2][3][4]

National concentration is very low. The Economic Census puts the four largest firms at 18.8% of group revenue (CR4), the top 8 at 26.3% (CR8), the top 20 at 39.9%, and the top 50 at 54.4%, with an HHI of 137.9 — far below the 1,500 "unconcentrated" line, and lower than any child except sand/gravel/clay. Nationally this is a fragmented industry group; it only looks concentrated locally (aggregates) or within a single commodity market (phosphate, potash, soda ash) — see §8. [2]

3b. The physical commodity (USGS — the authoritative volume/value measure)

The USGS (U.S. Geological Survey, the federal agency that tracks nonfuel mineral production) reports by commodity, not by NAICS code, so its universe does not line up one-to-one with 2123 — but it is the only source for tonnage, unit value, reserves, and trade. USGS values run larger than Census receipts because they count the whole commodity chain (including non-employer and captive pits the business census misses) in a more recent year; do not add USGS and Census figures.

"Mt" = million metric tons; "t" = metric ton. Sources: [5][6][7][8][9][10].

The physical scale is staggering. Crushed stone (~1.5 billion tons) plus construction sand and gravel (~0.87 billion tons) is roughly 2.4 billion tons of construction rock a year — the physical backbone of the built environment and, by weight, one of the largest extractive flows on earth. Yet its dollar value is modest because the material is cheap: this is a penny-a-pound, freight-dominated business, not a high-unit-value one. The chemical minerals are the mirror image — small tonnages at much higher unit values, several of them strategically critical.

Reserves. USGS calls U.S. resources of stone, sand, gravel, and clay "plentiful" to "extremely large" and publishes no numerical national reserve tonnage — for those children the binding scarcity is permitted material within economical haul distance of a growing market, not rock in general. For the chemical minerals, reserves and import-reliance vary sharply by commodity: soda ash sits on the world's largest trona deposit (Wyoming) and the U.S. is a net exporter, while potash is ~92% import-reliant and phosphate ~13–16%. Company disclosures are more informative than any national figure (e.g., Vulcan ~16.6 billion tons of aggregate reserves). [5][6][7][8][9] · [4]

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4. The investable universe

Because listed companies bundle these mining codes with downstream processing, foreign operations, and adjacent products, the names below describe investable companies, not clean shares of any 2123 child. This section — and only this section, plus §10 — carries tickers, market caps, yields, and valuation shorthand. Figures are approximate mid-2026 order-of-magnitude values, not federal statistics, and move with the market.

Stone & construction sand and gravel (~70% of the group) — the aggregates majors

Sand and gravel and crushed stone ride inside a combined "aggregates" segment, so a pure single-code financial statement does not exist. Every name here is leveraged to local construction volumes and pricing, not a national stone price.

Note: Summit Materials is no longer public — Quikrete completed a ~$11.5B take-private in February 2025, shrinking the listed aggregates field. Dimension stone (the ~4% cut-block niche inside stone) has no U.S.-listed pure-play since Rock of Ages went private in 2016 — it is private ground only. [12][6]

Industrial (frac) sand — a thinned-out public field

A decade of boom, bankruptcy, and take-privates left only a handful of listed names, all high-beta bets on shale completions.

• Atlas Energy Solutions (NYSE: AESI) — Permian in-basin sand plus owned logistics (the Dune Express conveyor); the largest listed play. [12]
• Smart Sand (Nasdaq: SND) — Northern White (Wisconsin) sand; micro-cap. [8-child]
• ProFrac Holding (Nasdaq: ACDC) — pressure-pumper with captive sand; hybrid.
• U.S. Silica (private, Apollo, 2024) and Covia (private, Sibelco) hold much of the tonnage.

Clay & ceramic/refractory minerals — one real public name

• Minerals Technologies (NYSE: MTX) — world's largest bentonite producer, but most value is downstream specialty products. Oil-Dri (NYSE: ODC) is a litter-levered micro-cap. Most premium kaolin/bentonite sits with private/PE/foreign owners (Thiele, KaMin, Sibelco, Wyo-Ben). [15]

Chemical & fertilizer minerals (21239) — producers, all levered to world prices

• Diversified fertilizer — Nutrien (NYSE/TSX: NTR) (world's largest potash producer) and Mosaic (NYSE: MOS) (largest U.S. phosphate miner) are the large-cap proxies. [16]
• Near-pure U.S. play — Intrepid Potash (NYSE: IPI) (New Mexico/Utah potash + Permian produced-water royalties) is the closest clean listed name. Compass Minerals (NYSE: CMP) is the rock-salt + sulfate-of-potash name. [16]
• Lithium / boron via majors — Albemarle (NYSE: ALB) (Silver Peak, NV — the only commercial U.S. lithium-brine operation) and Rio Tinto (NYSE: RIO) (U.S. Borax), plus development-stage lithium (Lithium Americas, Ioneer) for project optionality. [17]
• Much of the two biggest chemical commodities — salt and soda ash — is private/PE/foreign: Cargill and Morton in salt; WE Soda (Turkey's Ciner group) and Sisecam in Wyoming soda ash; J.R. Simplot (private) in phosphate. [24]

Royalty / land vehicles and funds (a structural gap across the whole group)

Unlike precious metals (Franco-Nevada, Wheaton), there is no large pure-play royalty/streaming company for aggregates, frac sand, clay, or fertilizer minerals, and no dedicated ETF for any child. Nearest listed royalty/land exposures: FRP Holdings (Nasdaq: FRPH) and Natural Resource Partners (NYSE: NRP) (aggregate royalties, diversified); LandBridge (NYSE: LB) (Permian surface royalties including frac sand); and Sweetwater Royalties (Green River Basin, private). Fund routes are all diluted: XLB (materials), PAVE / IFRA (infrastructure — materials only ~13–22%), MOO / VEGI (agribusiness), LIT (lithium/battery), XME (metals & mining). This is a stock-selection and private-diligence group, not an index one. [14][24][28]

No federal dataset quantifies the public/private/PE/foreign ownership split at any of these codes — precise percentages would be speculative. (A Martin Marietta management estimate puts roughly two-thirds of U.S. aggregate production in private hands — a management figure, not an official statistic.)

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5. How the money works

The economics rhyme across the group — abundant reserves added by acquisition not exploration, percentage-depletion tax shields, per-ton royalties — but the magnitude and source of commodity-price risk is exactly what separates the children.

The shared foundation: freight, reserves, depletion, royalties

• Freight is the cost curve for the aggregates majority. For most mined commodities the cost curve is about ore grade; for stone and construction sand and gravel it is about transportation. Trucking a low-value ton even 30–50 miles can add 50–100% to its delivered price, turning thousands of ordinary pits into local mini-monopolies. The low-cost supplier is the one closest to the job. There is no national break-even comparable to oil's lifting cost or a metal miner's AISC (all-in sustaining cost, the per-ounce cash-cost benchmark); the useful gauge is the freight-adjusted price-minus-cash-cost spread per ton. Vulcan's 2025 aggregates: ~$21.98 price − ~$10.65 cash cost ≈ $11.33/ton cash gross profit (~51% cash margin) — extraordinary for anything labeled "mining," and a direct product of local pricing plus operating leverage. [8][9]
• Reserves are added by acquisition, not exploration — the scarce input is permission, not geology. Reserve lives are long (decades), so reserve-replacement urgency is low versus oil and gas.
• Depletion is a permanent tax shield. U.S. law grants a percentage-depletion allowance — 5% for construction stone, sand, gravel, and common clay; 14% for industrial sand and premium clays; and specific rates for the chemical minerals. [21]
• Royalties are the capital-light way in. A landowner leasing pit or mine rights collects a per-ton or percentage royalty (commonly ~$0.20–$5.00/ton in aggregates, or 2–5% federal royalties on leasable chemical minerals) — a price-linked claim on gross tonnage with no operating cost, but bearing volume, permit, title, and operator-credit risk. [21][25]

Where the children diverge on price risk

• Stone & construction sand and gravel — local price-makers. Prices compound through the cycle even as volumes fall; the earnings engine is the widening per-ton spread, not a spot quote. Capital returns are a steady, growing dividend/buyback pattern — "quality cyclicals," not boom-bust payers. [5][8][9]
• Industrial (frac) sand — a double commodity bet. Oil and gas prices set completion budgets (demand); sand supply/demand sets the realized price. Mostly fixed costs plus a swinging price equals high operating leverage — exceptional cash in an up-cycle, insolvency at the trough (the Hi-Crush/Covia bankruptcies are the cautionary tale). Owning the logistics (conveyors, terminals) is where the durable edge lives. [4]
• Chemical & fertilizer minerals — global price-takers. Revenue tracks price, not volume: high fixed costs pass world-price swings disproportionately into cash flow. Low-cost natural producers (Wyoming trona, Florida phosphate) sit at the left of the global cost curve and stay cash-positive through downturns; high-cost swing producers shut when prices fall. Metal-style AISC thinking applies to phosphate and potash; salt is a freight-limited local-pricing business where location is the moat. [4]

The common thread — what this is not

Neither end of the group gives clean "buy-the-commodity" beta, and none of it is a regulated utility or a REIT — there is no rate base and no funds-from-operations story here. The right lens throughout is reserves, per-ton (or per-tonne) margin, cost-curve position, royalties, and depletion. The aggregates majority is essentially untouched by WTI (West Texas Intermediate crude oil), LNG (liquefied natural gas), or battery cycles; frac sand is an energy bet; and the chemical minerals are their own set of agricultural, industrial, and battery cycles. [5][6] · [4]

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6. What drives demand

Demand is the sum of three largely unrelated end-market bets, which is why the children rarely peak or trough together.

• Stone & construction sand and gravel → U.S. construction. USGS puts ~72% of crushed stone into construction aggregate (mostly roads), with cement and lime feedstock the rest. The most durable leg is public infrastructure: the Infrastructure Investment and Jobs Act (IIJA, 2021) put ~$350 billion into federal highways through fiscal 2026 — now in peak spend-out, with reauthorization after FY2026 the single biggest demand-swing variable. Private nonresidential and reshoring (warehouses, data centers, semiconductor/battery plants, grid build-out) is a new, housing-independent support; residential is the rate-sensitive drag. [5][20]
• Industrial (frac) sand → shale completions. Frac sand is ~81% of industrial-sand tonnage, so demand ≈ completed wells × lateral length × proppant per foot. Sand per well keeps rising as laterals lengthen, holding tonnage near records even in soft rig environments. The EIA (U.S. Energy Information Administration) sees U.S. crude and LNG exports rising through 2027, supporting completion volumes — though not necessarily prices if sand capacity stays ample. [4]
• Chemical & fertilizer minerals → farming, winter, glass, and batteries. Agriculture is the master cycle for phosphate and potash (no substitute for phosphorus or potassium as plant nutrients). De-icing takes ~37–41% of salt (a mild winter directly dents salt revenue). Soda ash, salt, and boron track glass, chemicals, and construction. And electrification is the highest-growth, highest-volatility vector: batteries are ~88% of lithium use, and LFP (lithium-iron-phosphate) chemistry opens a new phosphate demand channel. [5][6][7][8][9] · [4]

Notably, most of the group is not a critical-minerals or EV story — the thesis for ~85% of receipts is construction, energy, and consumer staples. The genuine green-transition exposure is concentrated in lithium and battery-grade phosphate inside 21239.

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7. Regulation

Regulation shares a spine across all three children but splits sharply on land tenure.

• Mine safety — MSHA (federal), shared by all. The MSHA (Mine Safety and Health Administration) regulates every pit, quarry, and mine as a metal/nonmetal operation — inspections, training, citation authority. The shared active item is MSHA's April 2024 respirable crystalline-silica rule, which halved the permissible exposure limit to 50 µg/m³; after an 8th Circuit stay the metal/nonmetal compliance date is, as of mid-2026, delayed — the hazard and prospective cost remain (hardest for quartz-rich granite, quartzite, and industrial sand), but the new limit is not yet fully enforceable. [16-child][22]
• Environment — EPA and states. Clean Air Act dust standards govern crushers; Clean Water Act (CWA) §404 wetlands rules and NPDES (National Pollutant Discharge Elimination System) stormwater permits cover dewatering and discharge; reclamation is largely state-administered. The heaviest single environmental liability in the whole group is phosphogypsum — the radioactive waste stacks from phosphate processing, an open-ended, long-tailed obligation. [19][27]
• Local zoning — the binding constraint for aggregates. Because heavy, cheap rock is only valuable near demand, local zoning and conditional-use permitting — not resource availability — decide whether a pit can open. NIMBY opposition and multi-year entitlements are the aggregates children's chief chokepoint. What blocks new entrants protects incumbents' pricing. [5][18]
• Land tenure — the sharp split. Aggregates sit mostly on private/state land; "common variety" stone, sand, gravel, and clay on federal land is sold as a saleable mineral material at fair market value under the Materials Act (not a locatable claim), so there is no oil-and-gas-style federal production-royalty regime for them. The chemical minerals are governed instead by the Mineral Leasing Act of 1920: phosphate, potash, and sodium (salt/soda ash/trona) are leasable — a BLM (Bureau of Land Management) lease plus rent and a federal production royalty (~5% phosphate/sulfur, 2% sodium and potassium), making the U.S. Treasury effectively a royalty owner; lithium remains locatable (claimed, historically royalty-free) under the General Mining Law of 1872. [18][20]
• Taxes and trade. State severance/property taxes vary; there is no uniform national rate. Trade policy matters most at the edges — dimension stone (~81% import-reliant) and potash (~92% import-reliant) are exposed to tariffs and geopolitics, while construction aggregates (net import reliance ~1%) are essentially untouched. [5][6] · [4]

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8. Consolidation

Fragmented nationally, concentrated where it counts — and consolidating everywhere. The structural pattern repeats across all three children: a concentrated top rolling up a fragmented tail, with buyers growing by acquiring permitted reserves because greenfield permitting near demand is so hard. The apparent contradiction between "2,460 firms, HHI 138" (§3) and real pricing power is resolved differently by child: aggregates are concentrated locally (a town may have two deliverable pits), the chemical minerals are concentrated within each commodity market (five phosphate firms, a handful of potash producers, five soda-ash firms, three boron firms).

Recent deals show the pace across the group:

• Aggregates: Quikrete–Summit (~$11.5B take-private, 2025); Holcim's Amrize spin-off (2025); pending CRH–Arcosa (~$8.5B) and Martin Marietta–Lhoist (~$13.5B). [11][12][23]
• Frac sand: consolidation via distress — Apollo's take-private of U.S. Silica, Atlas's roll-up of Hi-Crush, ProFrac's integration of Alpine Silica. The market fragments in booms and consolidates in busts. [4]
• Chemical minerals — increasingly into foreign and PE hands: WE Soda's ~$1.4B acquisition of Genesis Alkali (Wyoming soda ash, 2025); Stone Canyon's roll-up of Morton Salt; KaMin/BASF and Wyo-Ben/M-I SWACO in clay. [24][25]

Antitrust review (FTC — Federal Trade Commission; DOJ — Department of Justice) focuses on local overlap for aggregates (divestitures are common — CRH's Ash Grove deal required three quarry divestitures in one Kansas county) and on commodity-market concentration for the chemical minerals. The risk in every corner is overpaying for reserve tons that cannot be profitably delivered. [23][26]

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9. Risks

1. Commodity-price / demand cyclicality — the central risk, in three different flavors. Getting the flavor right is the whole underwriting task. Stone & construction sand and gravel: volume swings with construction while local price stays sticky-to-rising — a genuinely gentler cycle than oil, gas, or metals, but operating leverage still magnifies the earnings hit in a downturn. Frac sand: the sharpest in the group — price is hostage to shale completions and periodic oversupply, and high fixed costs turn modest price moves into large swings and, at the trough, insolvency. Chemical minerals: revenue and margin swing violently with globally set prices (a fertilizer major's ~40% revenue drop 2022→2024; lithium's ~80%+ collapse) — peak distributions are not annuities. [5][8][9] · [4]
2. Cost inflation / margin squeeze. Diesel, electricity, labor, explosives, freight, sulfur, and ammonia can outrun selling prices; the aggregates model depends on pushing price faster than cost (achieved recently, not guaranteed), and the chemical minerals' input costs can move opposite to their output price. [8][9]
3. Permitting, zoning, silica, and reclamation. The same local opposition that protects aggregates incumbents constrains their own expansion and can sterilize owned reserves; the silica rule (if reinstated) raises cost; phosphogypsum and reclamation are long-tail liabilities. [16-child][19][27]
4. Public-funding cliff. The IIJA highway authorization runs through fiscal 2026; a delayed or smaller reauthorization would remove a key demand pillar for the ~70%-of-receipts aggregates majority. (Already-obligated funds keep flowing, so a lapse would not halt work immediately — but it is a live overhang.) [5][20]
5. Import dependence and trade — commodity-specific. Potash (~92%) and dimension stone (~81%) are highly import-reliant; a strong dollar or supply shock is a direct risk (or, via tariffs, a tailwind for domestic producers). Construction aggregates are immune (import reliance ~1%). [5][6] · [4]
6. Demand concentration / stranded-asset risk — the split. Minimal for construction aggregates and clay (needed under every decarbonization scenario, and arguably helped by grid/data-center/reshoring capex). The exceptions are frac sand (a coal-like, if less acute, fossil-fuel overhang) and, in the other direction, lithium (whose risk is oversupply and price collapse, not obsolescence). [5][6] · [4]
7. M&A overpayment / valuation. Scarce permitted assets can be excellent businesses but poor investments at prices that assume perpetual pricing power; the aggregates majors trade at premium "quality-cyclical" multiples that embed continued price gains — a de-rating risk if volumes or infrastructure funding disappoint. [8][9][23]
8. Localized reserve depletion / sterilization. For aggregates the danger is not running out of rock nationally but exhausting a well-located pit and hauling farther — a margin risk, not a solvency risk. For the chemical minerals, a price drop can shrink reserves on paper even though the rock is still there. [5][8] · [4]
9. Illiquidity and concentration — private owners. Much of the group's tonnage is closely held (PE, family, foreign) with no public market — most extreme in dimension stone, soda ash, and salt. [6][13][24]
10. Weather and event risk. Mild winters dent salt; hurricanes hit Florida phosphate; weather drives quarterly noise in aggregates. [7]

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10. How to invest, and outlook

Public routes

• Aggregates (stone + construction sand and gravel) — the primary vehicle. Vulcan (VMC) and Martin Marietta (MLM) are the liquid pure-play large-caps — local-pricing-power reserve annuities with steadily growing dividends and buybacks; CRH, Amrize, Knife River, Eagle Materials, CEMEX, Heidelberg add diversified building-materials exposure. Return character is NOT oil/metals boom-bust — because the product price does not crash, these are compounders, not high-yielders (VMC ~0.7%, MLM ~0.5% dividend yield), trading at premium EV/EBITDA (enterprise value to earnings before interest, taxes, depreciation, and amortization) multiples precisely because of local pricing and long reserves. None touches dimension stone (private only). [8][9][10][11]
• Frac sand — cyclical energy-beta. Atlas Energy Solutions (AESI) is the cleanest listed play (low-cost Permian tons + owned logistics), with Smart Sand (SND) and ProFrac (ACDC) smaller/hybrid. Judge distributions against through-cycle free cash flow, not peak earnings. [4]
• Clay — a defensive single name. Minerals Technologies (MTX) is the one direct listed play (watch its talc-litigation liabilities); Oil-Dri (ODC) is a litter-levered micro-cap. [15]
• Chemical & fertilizer minerals — cyclical, price-taking producers. Diversified fertilizer (NTR, MOS), the near-pure U.S. potash small-cap (IPI), salt/SOP (CMP), and lithium/boron via majors (ALB, RIO) plus development-stage lithium (LAC, IONR). All cyclical — weigh balance-sheet resilience and mid-cycle free cash flow, not peak earnings. [16][17]
• Funds & royalties. No pure ETF or royalty stock exists for any child; the closest diluted routes are XLB / PAVE / IFRA (aggregates), oilfield-services ETFs (frac sand), MOO / VEGI / LIT / XME (fertilizer/lithium/mining), and FRPH / NRP / LB for indirect royalty exposure. [14][28]

Private routes (the only way into much of the group)

• Operating roll-ups. The fragmented long tail — deepest in construction sand and gravel and stone — earns the same local-monopoly cash flows the majors do, often at lower entry multiples. The playbook: buy an anchor pit in a growth market, professionalize pricing and safety, add nearby reserves and logistics, and sell a regional platform to a strategic consolidator. Most operators fall under the SBA size ceilings, making this a lower-middle-market and search-fund universe. [12][13]
• Direct / PE mine ownership is the main way to reach salt, soda ash, and dimension stone, and much of clay — plus development-stage lithium/phosphate projects (large upside, stacked geological/permitting/financing risk). Size leverage to trough cash flow, not a base-case price deck. [24]
• Mineral and royalty (land) ownership — leasing reserves for a per-ton or percentage royalty plus the depletion shield — is the lowest-operational-risk exposure: inflation-linked, long-duration income without running the mine. But it is illiquid, appraisal-driven, and title-dependent (a crucial diligence point: whether a deed's general "mineral" reservation even conveys common stone, sand, gravel, or clay — under some state law it does not). [21][25]

The underwriting rule (both worlds)

For the aggregates majority the valuable asset is permitted, specification-grade material inside an advantaged freight radius — diligence the delivered-cost map and site-level reserve life market by market, never the national average. For the chemical minerals the valuable asset is low-cost, long-life reserves at the bottom of the global cost curve — or the royalties on them — because in a price-taker business, cost position and reserve life are the only things anyone controls. In every case verify surface, mineral, access, and water rights independently.

Outlook

The group bifurcates. The ~70%-of-receipts construction-aggregates core (stone + sand and gravel) is structurally intact: freight-protected local pricing, long reserve lives, permitting barriers that entrench incumbents, and tailwinds from infrastructure, reshoring, power, and data centers, with near-zero transition risk. Its realistic risks are cyclical (volume) and political (highway reauthorization) — not structural demand destruction; USGS expects price-supporting forces to persist into 2026. The clay slice is a dull, defensive grind. Frac sand is soft on price, resilient on volume — the one child genuinely tied to the fate of U.S. drilling. The chemical & fertilizer minerals split again into a stable industrial base (salt, soda ash) and a higher-growth, higher-volatility frontier (phosphate/LFP, potash, lithium, boron), with ownership consolidating into foreign and PE hands.

What to watch: the post-IIJA surface-transportation reauthorization; mortgage rates and housing; diesel prices; freight-adjusted price and cash gross profit per ton (aggregates); the shale completion cycle (frac sand); global fertilizer and lithium prices (chemical minerals); the MSHA silica rule; and the M&A pipeline and deal multiples across all three.

Bottom line: 2123 is best read as one code, three business models on a single spectrum. The construction-aggregate majority (stone + sand and gravel, ~70% of receipts) is a cyclical, real-asset infrastructure business with local-monopoly pricing and near-zero transition risk — best owned through the large-cap aggregates equities or by holding permitted reserves in the path of growth. The frac-sand slice is a high-beta energy proxy. And the chemical-and-fertilizer-minerals corner is a set of leveraged global-commodity price-takers — fertilizer, de-icing, glass, and battery bets — best owned by sizing to the bottom of the cost curve. In none of it is this a "buy-the-commodity-price" bet across the board; it is, child by child, a buy-the-permitted-deposit-and-the-freight-moat bet (aggregates) or a buy-the-lowest-cost-reserve-and-the-royalty bet (chemical minerals). [2][5][6][8][9] · [4]

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Sources

1. U.S. Census Bureau — 2022 NAICS Manual: Industry Group 2123 (Nonmetallic Mineral Mining and Quarrying) and children 21231/21232/21239; adjacent manufacturing codes 325/327 (definitions, hierarchy, extraction-vs-manufacturing boundary), 2022. https://www.census.gov/naics/
2. U.S. Census Bureau — 2022 Economic Census, NAICS 2123 (our ground truth): receipts $36.331B; 2,460 firms; CR4 18.8% / CR8 26.3% / CR20 39.9% / CR50 54.4%; HHI 137.9. https://data.census.gov/table/ECNSIZE2022.EC2200SIZECONCEN
3. U.S. Census Bureau — 2023 County Business Patterns, NAICS 2123 (our ground truth): 5,293 establishments; 90,102 employees; $7.417B annual payroll; $1.758B Q1 payroll. https://www.census.gov/programs-surveys/cbp.html
4. Histometrics child-industry primers — NAICS 21231 (Stone), 21232 (Sand, Gravel, Clay & Ceramic/Refractory Minerals), 21239 (Other Nonmetallic Mineral Mining) — per-child receipts, firms, establishments, employment, payroll, concentration, USGS commodity figures, and company detail used to build the §2 contrast table and this rollup. (Draws on Census 2022 EC & 2023 CBP per child; USGS MCS 2026; SEC filings.)
5. U.S. Geological Survey — Mineral Commodity Summaries 2026: Stone (Crushed) (2025e ~1.5 Bt, ~$27B, ~$18.50/t; ~72% construction end-use; net import reliance ~1%; IIJA), Feb 2026. https://pubs.usgs.gov/periodicals/mcs2026/mcs2026-stone-crushed.pdf
6. U.S. Geological Survey — Mineral Commodity Summaries 2026: Stone (Dimension) (2025e ~2.3 Mt, ~$460M; ~81% net import reliance), Feb 2026. https://pubs.usgs.gov/periodicals/mcs2026/mcs2026-stone-dimension.pdf
7. U.S. Geological Survey — Mineral Commodity Summaries 2026: Sand and Gravel (Construction) and (Industrial) (2025e ~870 Mt @ ~$14.50/t; ~120 Mt @ ~$36/t; frac sand ~81% of industrial tonnage), Feb 2026. https://pubs.usgs.gov/periodicals/mcs2026/mcs2026-sand-gravel.pdf
8. U.S. Geological Survey — Mineral Commodity Summaries 2026: Clays, Salt, Soda Ash, Phosphate Rock, Potash, Lithium, Boron (2025e volumes, values, reserves, import reliance by commodity), Feb 2026. https://pubs.usgs.gov/periodicals/mcs2026/
9. Vulcan Materials Company (NYSE: VMC) — Form 10-K, FY2025 (226.8M tons; $21.98/t price; $10.65/t cash cost; $11.33/t cash gross profit; 16.6B tons reserves; royalties; capital returns). https://www.sec.gov/Archives/edgar/data/1396009/000162828026009546/vmc-20251231.htm
10. Martin Marietta Materials (NYSE: MLM) — Form 10-K, FY2025 (198.5M tons; ~$23.30/t price; ~16B tons reserves, ~85-yr life; aggregates ~88% of segment gross profit; pending Lhoist). https://www.sec.gov/Archives/edgar/data/916076/000119312526059193/mlm-20251231.htm
11. CRH plc (NYSE: CRH) — Form 10-K, FY2025; CRH to Acquire Arcosa (~$8.5B), 2026. Amrize Ltd. (NYSE/SIX: AMRZ) — Form 10-K, FY2025 (June-2025 Holcim spin-off). https://www.sec.gov/Archives/edgar/data/849395/000162828026009043/crh-20251231.htm
12. Atlas Energy Solutions (NYSE: AESI), Smart Sand (Nasdaq: SND), ProFrac (Nasdaq: ACDC) — Forms 10-K, FY2025 (frac-sand producers + logistics); Summit Materials / Quikrete take-private (~$11.5B, Feb 2025); U.S. Silica / Apollo (~$1.85B, 2024). SEC EDGAR / company disclosures.
13. Private / family / foreign owners — Rogers Group, Luck Stone, Blue Water Industries (aggregates); Polycor, Coldspring (dimension stone); Cargill, Morton, Compass (salt); J.R. Simplot (phosphate). Company disclosures, 2016–2026.
14. FRP Holdings (Nasdaq: FRPH); Natural Resource Partners (NYSE: NRP); LandBridge (NYSE: LB); Sweetwater Royalties — aggregate/frac-sand/mineral royalty models, FY2025 filings and disclosures. https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000844059&type=10-K
15. Minerals Technologies (NYSE: MTX) — Form 10-K, FY2025 (world's largest bentonite producer; value mostly downstream); Oil-Dri (NYSE: ODC) — Form 10-K, FY2025. https://www.sec.gov/Archives/edgar/data/891014/000089101426000067/form10k.htm
16. The Mosaic Company (NYSE: MOS), Nutrien Ltd. (NYSE/TSX: NTR), Intrepid Potash (NYSE: IPI), Compass Minerals (NYSE: CMP) — Forms 10-K / annual reports, FY2025 (fertilizer & salt producers; Mosaic net sales $19.1B 2022 → $11.1B 2024). SEC EDGAR.
17. Albemarle (NYSE: ALB) — Silver Peak, NV, the only commercial U.S. lithium-brine operation; Rio Tinto (NYSE: RIO) — U.S. Borax; Lithium Americas (LAC), Ioneer (IONR) — development-stage. Company disclosures / SEC filings.
18. U.S. Bureau of Land Management — Saleable Minerals / Materials Act of 1947 (common-variety stone, sand, gravel, clay sold at fair market value; not locatable). https://www.blm.gov/programs/energy-and-minerals/mining-and-materials/saleable-minerals
19. U.S. Environmental Protection Agency — Nonmetallic Mineral Processing NSPS (40 CFR Part 60 Subpart OOO); Mineral Mining & Processing Effluent Guidelines (40 CFR Part 436); NPDES; CWA §404. https://www.epa.gov/eg/mineral-mining-and-processing-effluent-guidelines
20. U.S. Bureau of Land Management — Nonenergy Leasable Minerals (Mineral Leasing Act of 1920) and 43 CFR §3504.21 Minimum Production Royalties (phosphate 5%, sodium 2%, potassium 2%); Congressional Research Service — Hardrock/locatable minerals incl. lithium (General Mining Law of 1872). https://www.blm.gov/programs/energy-and-minerals/mining-and-minerals/nonenergy-leasable-materials
21. U.S. Code — 26 U.S.C. §613, Percentage Depletion (5% construction stone/sand/gravel/common clay; 14% industrial sand and premium clays; per-commodity chemical-mineral rates). https://uscode.house.gov/view.xhtml?req=(title:26%20section:613%20edition:prelim)
22. U.S. Mine Safety and Health Administration — Lowering Miners' Exposure to Respirable Crystalline Silica, Final Rule, 89 FR 28218 (PEL 50 µg/m³), Apr 2024; Delay of Effective Date for Metal/Nonmetal (8th Circuit stay), 2026. https://www.msha.gov/regulations/rulemaking/silica
23. Recent aggregates M&A — Quikrete/Summit (~$11.5B, 2025); Martin Marietta/Lhoist (~$13.5B, pending); CRH/Arcosa (~$8.5B, pending); CRH/Ash Grove and Vulcan/Aggregates USA local divestitures. Company disclosures; FTC/DOJ. https://ir.martinmarietta.com; https://www.crh.com
24. Chemical-minerals M&A & ownership — WE Soda / Genesis Alkali (~$1.4B, 2025) and Sisecam (Wyoming soda ash); Stone Canyon / Morton Salt; KaMin/BASF and Wyo-Ben/M-I SWACO (clay). Company disclosures; U.S. DOJ. https://www.wesoda.com/
25. Rock Associates — Observed sand, gravel, and quarry royalty rates (~$0.20–$5.00/ton by state); Sweetwater Royalties — Green River Basin mineral acres. https://www.rockassociates.com/post/sand-gravel-and-quarry-royalty-rates
26. U.S. Federal Trade Commission / Department of Justice — Local-market antitrust analysis of aggregates mergers (CRH/Ash Grove Johnson County KS 3-quarry divestiture; Vulcan/Aggregates USA 17-facility divestiture), 2017–2018. https://www.ftc.gov/; https://www.justice.gov/
27. U.S. Environmental Protection Agency — Phosphogypsum (Florida phosphogypsum stacks >1B tons; 2021 Piney Point discharge). https://www.epa.gov/radiation/phosphogypsum
28. State Street / Global X / iShares / VanEck — Materials Select Sector SPDR (XLB); U.S. Infrastructure Development ETF (PAVE); U.S. Infrastructure ETF (IFRA); Agribusiness (MOO); MSCI Agriculture Producers (VEGI); Lithium & Battery Tech (LIT); Metals & Mining (XME) holdings, 2026. https://www.ssga.com/us/en/individual/etfs/state-street-materials-select-sector-spdr-etf-xlb

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Data-quality notes

• Ground truth vs. reports. Group-level business figures — receipts, firms, concentration, HHI (2022 Economic Census); establishments, employment, payroll (2023 CBP) — are Histometrics' ingested federal statistics for NAICS 2123 [2][3]. Physical production, unit value, reserves, and trade are USGS by commodity [5][6][7][8]; company figures are 2025 SEC filings [9][10][15][16].
• The rollup reconciles on additive frames. The children's 2023 CBP establishments (2,440 + 2,617 + 236 = 5,293) and employees (43,124 + 36,740 + 10,238 = 90,102) sum exactly to the parent, and 2022 receipts ($17.72B + $12.84B + $5.77B ≈ $36.33B) and payroll (~$7.42B) reconcile — because each establishment carries one primary code. Firm counts do not add (children list 2,562; parent 2,460) because a firm operating in multiple children is de-duplicated at the group level (~102 firms) [2][3][4].
• Frames are not interchangeable. USGS commodity values exceed Census receipts (e.g., ~$27B crushed-stone value vs. Census receipts) because USGS counts the whole commodity chain — including non-employer and captive operations classified elsewhere — in a more recent year than the Census primary-code population. Do not add or average the two [2][5].
• Not stated because unavailable. Our 2123 ground truth contains no group-level physical tonnage, reserve tonnage, unit value, per-ton cost/AISC-equivalent, or a single SBA size standard — those are undefined at this level; where used, physical/price data are USGS commodity series (per child) and are labeled as such. No numerical national reserve total exists for the aggregate codes; USGS characterizes those reserves only qualitatively.
• Estimates and derivations. Per-child shares of the group are computed from [2][3][4]; USGS "(e)" values are USGS estimates; the ~2.4-billion-ton construction-rock figure sums USGS crushed-stone and construction-sand-and-gravel tonnages.
• Market caps, tickers, yields, and multiples in §4 and §10 are approximate mid-2026 figures for context only, not drawn from the federal sources, and move with the market.