Doesn't matter, Barrick's hedge contracts can be rolled forward and half of production is not hedged. Hedging was great for Barrick when the rest of the mining companies were getting market prices for gold, Barrick was making over $300 million a year just from their hedge premium.
All things considered I'll take unhedged. (with the exception of DROOY)
(Barry Cooper at CIBC World Markets in Toronto on 4/23)
Investors, says Cooper, are voting with their dollars, preferring to buy shares of the world's largest unhedged producers, Denver's Newmont Mining and South Africa's Gold Fields, as opposed to their hedged counterparts.
"Investors just don't want to be stuck with a hedged position if gold rallies strongly," he said.
Indeed, shares of unhedged producers have outpaced by a wide margin those that hedge by forward-selling their gold. Shares of Gold Fields, South Africa's second largest gold miner, are up 145 percent. The company has no hedge book. In contrast, shares of hedger Placer Dome have risen 13 percent and Barrick Gold is up just 16 percent.