RE:Post from the past shows my geniusAlfie - Good call on $1.50 zinc. However, as to the hedge, 11 months ago you were calling management genius and expecting that zinc would drop in price when Caribu opened. Nice to see your forecasting skills improve.
As has been thoroughly discussed previously, the hedge was necessary to save this company from the brink. What a difference a year makes!
AlfTanner - (11/24/2020 11:41:08 AM)
RE:RE:RE:RE:TREVALI EXTENDS ZINC HEDGING PROGRAM OUT TO END OF 2021
kramaswamy, I think you are exactly right. This is a very good hedge with a price of $1.23. Hedging only 25% of production will not save the company if the price of zinc collapses, but it gives a very nice cushion against potential market swings, and it gives some stability to the profit picture for next year.
To the dopes who are obsessed with Caribou, $1.23 is not nearly enough to justify the costs of trying to reopen that loser mine. As I said before, they need closer to $1.50, and they need to hedge 100% for at least 2 years. The press release specifically said that they were hedging 59.5 mlbs or 25% of production. These numbers definitely do not include Caribou.
I must admit, management is getting smarter. This is a good move. Zinc could keep moving higher, but what this company needs right now is some security.