LONDON, Feb 26 (Reuters) - Mining companies are expected to reduce their gold hedging positions by 6-8 million ounces in 2008, against a decline of 13.5 million last year, a report sponsored by Fortis Bank said on Tuesday.

"Will this pace be maintained in 2008? We doubt it, for the simple mathematical reason that there is much less hedging to be either closed-out or delivered into than there was a year or two years ago," it said.

Hedging allows producers to lock in prices for future output, but it can backfire if metals prices rise above the hedged price. High gold prices XAU= have prompted producers to lower their hedging positions.

The global hedge book showed a decline of 2.3 million ounces to 26.8 million in the fourth quarter of 2007, registering the 23rd consecutive quarterly reduction, said the report, prepared by the VM Group and Haliburton Mineral Services.

"With the gold price at record highs, mining companies continue to close out their hedge positions to take advantage of further gains. There is little sign of this stopping in the near term," said Jessica Cross, chief executive officer of the VM Group.

Of the 113 gold miners included in the survey, 47 had hedging programmes at the beginning of the fourth quarter, while 39 companies reduced their hedging commitments.

Australia-focussed Newcrest Mining Ltd (NCM.AX: Quote, Profile, Research) was the leading dehedger as it reduced its hedging position by 735,355 ounces in the fourth quarter and announced it had cut another 299,275 ounces in the first quarter of 2008.

AngloGold Ashanti (ANGJ.J: Quote, Profile, Research), Barrick Gold (ABX.TO: Quote, Profile, Research), Red Back Mining (RBI.TO: Quote, Profile, Research), Highlands Pacific (HIG.AX: Quote, Profile, Research), Austindo Resources and Lafayette Mining also cut their positions during the fourth quarter.

The report said exchange-traded funds backed by physical gold continued to grow and added 2.6 million ounces, or 80 tonnes, of the metal in the fourth quarter of 2007.