Gold Hedging Returns as Harmony, Acacia Lock In Profit Margins
- Harmony hedges rand while Acacia takes contracts on gold price
- Move is partial return to strategy that cost industry in 2000s
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Harmony Gold Mining Co. and Acacia Mining Plc agreed to lock in profit margins at some of their African operations in a return to hedging strategies that undermined the industry during the metal’s bull run in the 2000s.
Harmony, which gets 95 percent of its production from South Africa, hedged its local currency at between 15.59 rand ($1.03) and 18.60 rand per dollar for a third of its annual production, it said in a statement Tuesday. Acacia took out contracts known as zero-cost collars on 136,000 ounces of gold from Buzwagi, a Tanzanian mine, at $1,150 an ounce to $1,290 an ounce, it said in a separate statement.