RE:RE:Time to hedge Santander?Trevali has a Life-Of-Mine concentrate off-take agreement with Glencore whereby Glencore buys 100% of the Santander mine production at Benchmark terms.
Trevali has similar agreements with Glencore for concentrate produced at other mines.
Glencore would agree to any deviations in these agreements only if the deviation is to there advantage. Hedging, being a deviation, will need approval from Glencore.
In addition to being a miner and producer of refined zinc, Glencore is also a big trader of base metals. They have a better idea of future price movements. Previous hedges were approved by Glencore because they knew that the price of zinc was going to go up during the period of the hedge. So they took advantage of Trevali's vulnerability (remember Trevali was on the verge of bankruptcy).
I don't see Glencore agreeing to any hedges now since the price of zinc is in backwardation. Spot prices are higher than 3-month forward prices. This means that the price of zinc has likely peaked and will stay stable or decline in near future.
IMHO