Actually, having given it some further thought, my previous post...

Actually, having given it some further thought, my previous post is wrong. The AUD/USD exchange rate has nothing to do with it. It is the fact that TTY isn't making as much money in USD anymore as a result of the fall in iron ore prices. I read yesterday that the spot market is currently about US$60 per tonne, so TTY have AUD$73 million hedged, which at my assumption of the contracts being locked in at parity translates to US$73 million. So TTY need to be selling 1.2 million tonnes of ore at US$60 per tonne to meet their currency hedging obligations. Does this sound doable? Well, given that Frances creek is aiming for 2million tonnes p.a. by Dec 2008, it sounds possible, but we have no idea how short TTY are of their hedging contracts and what the time frame for meeting them is. More information would be great.

However, it does appear that TTY have locked in their sales at a higher AUD/US exchange rate, so I'm assuming that all sales so far this year haven't benefited at all from the weaker Aussie Dollar :-(