Ann: Debt Finance , page-17

"Hedging is not all bad...If CCU hedge at say $33oz and Silver drops below that price then CCU wins.."

Hedgeing is one of those things that everyone has a view on in hindsight. Its a part of industry, and has a habit of making naked, any management that is not too good at it.

Eg. Southwest Airlines in the US shrewdly hedged its oil ahead of the spike a few years ago, and sailed through the subsequent problems.

Qantas too, hedged its oil but at the high prices. Their hedges cost them a fortune, but they explained this by way of referring to "negative hedges" in subsequent reports. The current fuel levy is actually covering poor hedgeing losses, not the current fuel price.

Obviously CCU had to hedge some production. Its a balancing act, and part of the cost of insuring and ensuring their loan. If everything goes according to plan, the hedge will cost them some money, but lowers overall risk. I think the balance is good.