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Unformatted text preview: poses. (a) Foreign Currency Risk Management
The Company’s foreign currency risk management strategy may use derivative instruments to
protect against foreign exchange rate volatility, which may impair the value of certain of the
Company’s assets. The Company may use foreign currency forward-exchange contracts,
foreign currency swaps and forward currency options contracts to implement this strategy. 34 Aracruz Celulose S.A.
Notes to Consolidated Financial Statements
Expressed in thousands of United States dollars
(unless otherwise stated) At December 31, 2000, the Company had entered into five forward foreign-exchange contracts
to protect its foreign currency denominated accounts receivable and bank balances against
exchange rate movements in the aggregate amount of EUR 3,103 thousand (1999 – EUR
23,840 thousand), equivalent in aggregate to U.S.$ 2,885 (1999 – U.S.$ 24,173). The
contracts expire in January, February and March 2001. The Company realized a net loss in
2000 associated with its forward foreign exchange contracts of U.S.$ 227 (1999 – U.S.$
Additionally, the Company ha...
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- Spring '08