UPDATE 1-Gold miners face new challenge in plummeting gold price
* Gold equities slide as spot gold falls below $1,400/ounce
* Gold miners already grappling with rising costs
* Producers with fewer projects, higher costs at particular risk
* Price drop could hit price-linked dividends
* Hedged miners hold up better than peers (Adds Hillgrove comment, Australia share moves)
By Allison Martell and Euan Rocha
TORONTO, April 16 (Reuters) - A steep drop in the price of gold will hit profits at mining companies that are already straining under rising costs, and could prompt some miners to rethink their capital spending.
Gold companies big and small sold off on Monday and Tuesday as the prospect of central bank gold sales and fears that the U.S. might reduce monetary stimulus tipped spot gold prices off a ledge, to a more than two-year low around $1,300 an ounce.
While lower prices are not likely to wipe out miners' profits, they will squeeze cash flows as companies are still feeling the impact of pricey acquisitions made at the height of the commodity cycle. Continued...