GREY:HRIVF - Post by User
Post by
Honkeybillon Jan 06, 2010 3:03pm
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Post# 16645829
Production costs climb equally to the rise in pric
Production costs climb equally to the rise in pric HUH? Is this some new economic theory? It cost "X" dollars per ounce to remove a resource from the ground......and the costs flucuate relative to the expenses related to the actual cost of the work involved (labour, price of energy, maintenance.etc..etc).
If it takes $500 an ounce to extract gold from the ground when it's selling for $700 per ounce, it won't cost $1000 an ounce for extraction if gold reaches $1400 per ounce.
My understanding is HRG's extraction costs are relatively stable and have actually improved with Severstaal at the helm. The weakened ruble is also helping.
It looks like Severstaal has changed their strategy and is looking to pump this up and sell it.
I would love to see your calculations..........please post them.