SMM Implements Hedge for Gold Produced in Hishikari and Pogo

Sumitomo Metal Mining (SMM) announced on Monday the firm implemented a minimax hedge against planned gold productions at Hishikari mine in Kagoshima, Japan and Pogo mine in Alaska, USA. SMM sets guaranteed sales prices for gold produced in Hishikari and Pogo to reduce rough fluctuation risk of its financial results when gold market price stays at high level.

SMM currently produces gold at 7.5 tonnes per year in Hishikari mine and 12 tonnes per year in Pogo. For gold produced in Hishikari, SMM sets guaranteed price range for US$ 900-1,835 per toz against 900 kilogram per quarter from July 2012-June 2013. For gold produced in Pogo, SMM implements a same hedge at US$ 1,000-1,870 per toz for a half of SMM’s 85% equity in the mine for January-December 2015.

SMM had previously implemented hedge for gold in September 2009.