The sudden weakening of the rand against a basket of currencies as the Turkish lira took punishment presents opportunities for the SA mineral producers, with one in particular, Harmony Gold, showing a recent track record of well-timed activity. Gold miners can use a financial instrument called a "hedge" — essentially agreeing to an upfront sale price of future production for delivery at set times.Both parties are taking a bet on what the metal price will do. It’s a bet that can go badly wrong for the mining company and its investors. Given the general wariness around hedging, SA gold producers have generally avoided hedging, but in recent years Gold Fields has hedged gold and oil prices for capital intensive projects in Ghana and in Australia. Harmony caught its investors by surprise in 2016, putting in place a hedge for 20% of its gold production for 24 months and putting in contracts for the rand exchange rate against the dollar, something that has enormously benefited its financi...

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