London, England — MININGREVIEW.COM — 08 August 2008 – The world’s gold miners cut their hedging positions by 16% in the second quarter of 2008, but the de-hedging rate is expected to slow significantly for the remainder of the year.
Reuters reports from here that the quarterly report – produced by VM Group and Haliburton Mineral Services, and sponsored by Fortis Bank – revealed that miners had bought back 3.5 million oz of hedged gold in the second quarter of the year, bringing the total global hedge-book to 18.7 million ounces.
It added that Anglogold Ashanti – the world’s third largest gold miner – had led the de-hedging, buying back 2.7 million oz of gold in the second quarter. Thirty other companies had also cut their hedge-books during the quarter by a combined 800 000oz. Sino Mining, Barrick, Newcrest and Lihir/Equigold had all cut their positions by more than 100 000 oz.
The report went on to say that it expected de-hedging to tail off for the remainder of the year, with second-half de-hedging expected to reach only 2.4 million ounces. “The rate of global de-hedging will slow sharply from now on,” it predicted.
A sharp rise in the price of spot gold, which has more than doubled in the last three years, has prompted producers to reduce their hedging positions.