XML 59 R14.htm IDEA: XBRL DOCUMENT v2.4.0.6
DERIVATIVE INSTRUMENTS:
 3 Months Ended
Mar. 31, 2013
DERIVATIVE INSTRUMENTS:  
DERIVATIVE INSTRUMENTS:

NOTE 6 — DERIVATIVE INSTRUMENTS:

 

As part of its risk management policy, the Company occasionally uses derivative instruments to (i) safeguard the corporate assets, (ii) insure the value of its future revenue stream, and (iii) lessen the impact of unforeseen market swings on its sales revenues.  To comply with these objectives the Company, from time to time, enters into commodity price derivatives, interest rate derivatives, exchange rate derivatives and other instruments.  The Company does not enter into derivative contracts unless it anticipates a future activity that is likely to occur that will result in exposing the Company to market risk.

 

Copper hedges:

 

In 2011, the Company entered into copper zero cost collar derivative contracts to reduce price volatility and to protect a portion of its sales value for the first quarter of 2012. Under these contracts the Company protected 46.3 million pounds at an average cap price of $5.18 and a floor price of $3.50.  These transactions meet the requirements of hedge accounting.  There were no realized gains and losses from these transactions.

 

As of March 31, 2013, the Company does not hold copper derivative contracts.