details of hedging - weep....., page-4

I understand why it is done. But that doesn't make matters any better. You have a look at the 1/2 yearly statements. As at 31/12 they had a mark to market loss on their hedging of about 85 Million AUD. Since the 31/12 prices in some cases have nearly doubled hence the situation is now much worse. I would not be surprised if the hedge book loss was around 150 Million +. Off course this doesn't make any difference as long as they deliver into these contracts. Their bankers may agree to roll forward their commitments but this does not happen for free and it just delays the inevitable

Looking in 1/2 year is says just for copper.

year <1 ( ie this year ) 3100 Tonnes at 1994 USD per Tonne, Year 1 to 2 6525 Tonnes @ 1989 USD per Tonne, Years 2-5 7700 Tonnes@ 1864 USD per Tonne.

If their bankers agree to roll forward their current forward sales it means 2 things 1) They will pay for that change, 2) 3100 Tonnes will need to be delivered in Future years at that price 1994. With copper fast approaching 7000 USD per Tonne I cannot see how this will make matters better. Longer term it may make matters worse if copper keeps increasing in price.