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(In thousands of dollars except as noted and per share amounts) 

## 9. FINANCIAL INSTRUMENTS (CONTINUED): 

Derivative financial instruments (continued): 

(c) Foreign exchange contracts: 

 The Company’s activities which result in exposure to fluctuations in foreign currency exchange rates consist of the purchasing of raw sugar, the selling of refined sugar and the purchase of natural gas.The Company manages this exposure by creating offsetting positions through the use of financial instruments.These instruments include forward contracts, which are commitments to buy or sell U.S. dollars at a future date, and may be settled in cash. 

 The credit risk associated with foreign exchange contracts arises from the possibility that a counterparty to a foreign exchange contract, in which the Company has an unrealized gain, fails to perform according to the terms of the contract.The credit risk is much less than the notional principal amount, being limited at any time to the change in foreign exchange rates attributable to the principal amount. 

 Forward foreign exchange contracts have maturities of less than two years and relate exclusively to U.S. currency. The counterparties to these contracts are major Canadian financial institutions.The Company does not anticipate any material adverse effect on its financial position resulting from its involvement in these types of contracts, nor does it anticipate non-performance by the counterparties. 

 The Company’s foreign currency forward contracts relating to the purchase of raw sugar, the sale of refined sugar and the purchase of natural gas are as follows: 

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