An A$800 million Australian mining company announced this week it is hedging exposure to gold and diesel prices for production in the 2025 calendar year.
Pantoro, which referred to the move as a “gold price protection facility” fostered by options covering about 24% of 2025 production, opened the trade without any premium payment made to Commonwealth Bank.
Pantoro Managing Director Paul Cmrlec said the move still provides total exposure to gold prices up to A$4,200 an ounce with minimal downside when prices rise above that. In Australian dollars, gold traded at A$3,900 on Wednesday.
At a gold price of A$5,000 Pantoro would realize profits on a gold price of A$4,904.
This chart shows the change in exposure to gold prices on a monthly basis through the 2025 calendar year. (Source: Pantoro)
As part of the move, the Australian miner also hedged 800,000 liters of diesel per month at current prices for the 2025 calendar year. Diesel prices are at a multi-year low in Australia, though experts have speculated a move higher due to rising tensions in the Middle East.
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