Why couldnt they hedge when IO was at 90 in Jan-March or now when its 70???
Why take a terribly low hedge of 50-55 and allow sales of 100% on it without flexibility?
Who signed off and agreed to such a terrible hedge contract that puts AGO into a straightjacket or is this deliberate until after 1 August?
The hedge contract can have terms to allow the hedge to be applied over 2 years for 50% of stock but not 100% monthly of ALL stock sold so it can be used over longer terms but not like this! It looks like they have no choice but to use the hedge sales and cant get out of it.
A contract is a negotiation and looks like they cant negotiate their hedge or bond contracts very well at all other than at the worst possible terms. Again thats bad management.
They have to get out of these 3 straightjackets - debt/bond terms, 9B equity and terrible hedge contracts
only then will the animal spirits return and when IO price rises can they make moolah like the others.
Iron ore price, page-2939
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