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Yeah we always do. Mining is incredibly cyclical boom/bust In Australia for this reason. Also it’s just as difficult to leave it in the ground. Any decent mini
by rmm 7y ago
Yeah we always do. Mining is incredibly cyclical boom/bust In Australia for this reason.
Also it’s just as difficult to leave it in the ground. Any decent mining operation takes at minimum 2-3 from construction to production so you still need to take that into account (unless you lock down some offtake agreements to hedge the risk)
- iguy 7y agoHow financialized are mines, for want of a better term? i.e. Are people buying the mining company's shares assumed to be taking the gamble on what prices will be in 5 or 10 years, or do mining companied buy a ton of futures to try to even things out?
- bluGill 7y agoBoth, depending on the company. The great companies are play heavily in the futures market, as a result their production is mostly locked up when the boom comes and so they don't make any extra money. The not so great companies sell to market mostly, and make a ton of profit in the boom years and are lucky if they don't go bankrupt in the bust years. Of course great and not so great are by my definition of great. You can do should do your own investigation.