Why forward sales hurt bottom lines in a bull market A bull market in gold is a double edged sword while gold prices are high so are costs the balancing act is to keep costs down so more goes to the bottom line but when you forward sale you have no upside on the price of gold but still have the downside of your costs going up labour wants more cause gold prices are higher inflation causes inputs to be more goverments ussally are raising taxes in this environment and interest rates are ussally stubbornly higher all this while you have a fixed sale price on your production at a lower price than the increasing market price
Banks often require derivatives as security on loans this practice has hurt many gold companies in past bull markets and this one is projected to be longer and higher than previous gold bull markets .As this bull market contiues the derivative sales will become an anchor on companies share price for those that have over partaken in this practice