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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (81349)	1/31/2002 11:08:06 PM
From: goldsheet	Read Replies (1) \| Respond to of 116756

Well, I think I made my case that the importance of hedging as a factor in the gold market probably peaked in 1999 with the two "almost disasters" of Ashanti and Cambior, and the September 1999 short squeeze. In 2000, a little hedging was covered (10mt) then a more impresssive 110mt in 2001. I suspect 300mt+ might be eliminated in 2002 without any significant impact. More firms might just deliver production into hedges, and even if they do not eliminate hedges they will get restructured. Anglogold apparently wishes they wrote more forwards in $US instead of rands, and have adjusted the hedge book accordingly. I am led to the conclusion that miners will gradually and gracefully adjust their hedges, without either hurting themselves significantly or affecting the gold price too much to the upside. Some Australians still have big negative mark-to-markets, but I think several firms will be acquired and the risk moderated.