This is how I picture the conversation went down.

Thror: Amazing! We've struck mithril!
Thrain: You know, dad, that stuff's going to take forever to work into anything usable.
Thror: Look, son, I don't like it any more than you. But Thranduil did send me that nice set of ale mugs as a wedding present, and I've been meaning to get something nice for his boy.
Gandalf: I'm pretty sure Saruman has Fabricate in his spellbook. I could ask him next time I see him. I think the standard charge is 450 gold.
Thror and Thrain: WHAT?!
Thror: That's outrageous!
Thrain: Blasted wizard probably told the tree-hugger about the mugs anyway.
Thror: You know, I don't remember sending him a copy of the registry...
Gandalf: Look, it's really not that much. Just a one-time casting, and out pops a mithril shirt. How much gold are you not going to be mining while you're working on it, eh?
Thror: And out it pops, just like that? Listen, pointy-hat, we've been making our own metal by hand for thousands of years. We're not going to change that just because some magical ninny with a fancy wand comes along. You can go tell Thranduil that we'll have that shirt ready for his boy in about three years.