policy of hedging 50% at us$1.45/lb copper, page-17

the hedging is not new news and i think all that mikayla has done is to prepare us for a quarterly report that may not be as profitable as we all hoped - however bringing attention to it just days before the report is announced doesn't really change what has been common knowledge for the last few months.

mikayla may have given us a reality check for the short term but long term may not be an issue - with all of this wild discussion about hedging i have yet to see a definitive statement regarding PNA's actual hedge. can anybody supply full details and analysis?

i think some people imagine that copper could have been hedged at $US4.00/lb last year - i very much doubt that. hedging requires you to accept a much discounted price and $US4.00 doesn't meet that requirement. early this year most thought that hedging at any price was the prudent way to proceed so what we are seeing now is 20/20 hindsight.

it's easy to criticise management for not having hedged production when copper was above $US4.00 but most thought it would rise even higher. critics should also try and name any copper miner who did hedge when prices were at all time highs - i don't know of any. if the copper price hadn't bounced back from $US1.30 lows then there would be a large contingent criticising why no hedge had been put in place at $US1.95.

in summary PNA management can't accurately predict the future just the same as none of us can. they can't be given a 100% report card but they have protected us from being totally wiped out.

as far as copper being priced in $US and the fear of hyper-inflation and/or devaluation : my take is that the copper price will outstrip the devaluation so the rise in copper price will still be hugely beneficial to PNA.