Risk Management

Schedule of Amounts Recognized and Guarantees Given Related to Derivative Financial Instrument

	Gains/ (losses) recognized in the statement of income
	Jan-Jun/2022	Jan-Jun/2021	Apr-Jun/2022	Apr-Jun/2021
Commodity derivatives
Other commodity derivative transactions - 27.2 (a)	(222)	(42)	(169)	(19)
Recognized in Other Income and Expenses	(222)	(42)	(169)	(19)
Currency derivatives
Swap Pounds Sterling x Dollar - 27.3 (b)	(156)	(3)	(126)	(32)
NDF – Pounds Sterling x Dollar - 27.3 (b)	−	9	−	5
Swap CDI x Dollar - 27.3 (b)	147	56	(22)	84
Others	−	1	−	−
	(9)	63	(148)	57
Interest rate derivatives
Swap - CDI X IPCA	(16)	(10)	(15)	18
	(16)	(10)	(15)	18
Cash flow hedge on exports ^(*)	(2,488)	(2,307)	(1,108)	(1,194)
Recognized in Net finance income (expense)	(2,513)	(2,254)	(1,271)	(1,119)
Total	(2,735)	(2,296)	(1,440)	(1,138)

(*)	As presented in note 27.3

Schedule of guarantees given as collateral

	Guarantees given as collateral
	06.30.2022	12.31.2021
Commodity derivatives	111	15
Currency derivatives	134	27
Total	245	42

Schedule of expected reclassifications to the statement of income of cumulative losses

Present value of hedging instrument notional value at

06.30.2022

Hedging Instrument

Hedged Transactions

Nature

of the Risk

Maturity

Date

US$ million

R$ million

Foreign exchange gains and losses on proportion of non-derivative financial instruments cash flows

Foreign exchange gains and losses of highly probable future monthly exports revenues

Foreign Currency

– Real vs U.S. Dollar

Spot Rate

July 2022 to June 2032

64,626

338,509

Changes in the present value of hedging instrument notional value	US$ million	R$ million
Amounts designated as of December 31, 2021	72,640	405,370
Additional hedging relationships designated, designations revoked and hedging instruments re-designated	6,162	32,036
Exports affecting the statement of income	(5,794)	(29,264)
Principal repayments / amortization	(8,382)	(42,533)
Foreign exchange variation	-	(27,100)
Amounts designated as of June 30, 2022	64,626	338,509
Nominal value of hedging instrument (finance debt and lease liability) at June 30, 2022	75,052	393,121

Schedule of reclassification of cumulative foreign exchange losses recognized

A schedule of expected reclassification of cumulative foreign exchange losses recognized in other comprehensive income to the statement of income as of June 30, 2022 is set out below:

	2022	2023	2024	2025	2026	2027	2028 a 2031	Total
Expected realization	(4,281)	(7,051)	(5,289)	(3,329)	(2,828)	(3,040)	(3,242)	(29,060)

Schedule of sensitivity analysis for foreign exchange risk on financial instruments

Financial Instruments	Exposure at 06.30.2022	Risk	*Probable Scenario ^()**	Reasonably possible scenario	Remote Scenario
Assets	4,458		10	1,115	2,229
Liabilities	(86,164)	Dollar/Real	(197)	(21,541)	(43,082)
Exchange rate - Cross currency swap	(574)		(1)	(144)	(287)
Cash flow hedge on exports	64,626		148	16,156	32,313
	(17,654)		(40)	(4,414)	(8,827)
Assets	3	Euro/Real	−	1	2
Liabilities	(128)		(1)	(32)	(64)
	(125)		(1)	(31)	(62)
Assets	936	Euro/Dollar	3	234	468
Liabilities	(1,869)		(6)	(467)	(935)
	(933)		(3)	(233)	(467)
Assets	2	Pound/Real	−	1	1
Liabilities	(20)		−	(5)	(10)
	(18)		−	(4)	(9)
Assets	1,661	Pound/Dollar	5	415	830
Liabilities	(3,267)		(9)	(817)	(1,634)
Derivative - cross currency swap	1,246		4	312	623
	(360)		−	(90)	(181)
Total at June 30, 2022	(19,090)		(44)	(4,772)	(9,546)

(*)

At June 30, 2022, the probable scenario was computed based on the following risks: R$ x U.S. Dollar - a 0.23% depreciation of the Real; Euro x U.S. Dollar: a 0.3% appreciation of the Euro; Pound Sterling x U.S. Dollar: a 0.29% appreciation of the Pound Sterling; Real x Euro: a 0.5% depreciation of the Real; and Real x Pound Sterling - a 0.5% depreciation of the Real. Source: Focus and Thomson Reuters.