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Derivatives And Other Financial Instruments (Tables) | 3 Months Ended
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Mar. 31, 2012
Derivatives And Other Financial Instruments [Abstract] |
Schedule Of Fair Values Of Outstanding Derivative Contracts Recorded As Assets |
Asset Derivatives |  | Level |  |  | March 31, 2012 |  |  | December 31, 2011 |
Derivatives designated as hedging instruments: |  |  |  |  |  |  |  |  |  |  |  |
Prepaid expenses and other current assets: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 1 |  |  | $ | 39 |  |  | $ | 51 |
Aluminum contracts |  |  | 3 |  |  |  | 4 |  |  |  | 5 |
Interest rate contracts |  |  | 2 |  |  |  | 5 |  |  |  | 8 |
Other noncurrent assets: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 1 |  |  |  | 6 |  |  |  | 6 |
Energy contracts |  |  | 3 |  |  |  | — |  |  |  | 2 |
Interest rate contracts |  |  | 2 |  |  |  | 39 |  |  |  | 37 |
Total derivatives designated as hedging instruments |  |  |  |  |  | $ | 93 |  |  | $ | 109 |
Derivatives not designated as hedging instruments*: |  |  |  |  |  |  |  |  |  |  |  |
Prepaid expenses and other current assets: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 2 |  |  | $ | 1 |  |  | $ | 1 |
Other noncurrent assets: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 3 |  |  |  | 4 |  |  |  | 5 |
Foreign exchange contracts |  |  | 1 |  |  |  | 1 |  |  |  | 1 |
Total derivatives not designated as hedging instruments |  |  |  |  |  | $ | 6 |  |  | $ | 7 |
Less margin held**: |  |  |  |  |  |  |  |  |  |  |  |
Prepaid expenses and other current assets: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 1 |  |  | $ | — |  |  | $ | 7 |
Interest rate contracts |  |  | 2 |  |  |  | 5 |  |  |  | 8 |
Other noncurrent assets: |  |  |  |  |  |  |  |  |  |  |  |
Interest rate contracts |  |  | 2 |  |  |  | 13 |  |  |  | 7 |
Sub-total |  |  |  |  |  | $ | 18 |  |  | $ | 22 |
Total Asset Derivatives |  |  |  |  |  | $ | 81 |  |  | $ | 94 |
* | See the "Other" section within Note L for additional information on Alcoa's purpose for entering into derivatives not designated as hedging instruments and its overall risk management strategies.
** | All margin held is in the form of cash and is valued under a Level 1 technique. The levels that correspond to the margin held in the table above reference the level of the corresponding asset for which it is held. Alcoa elected to net the margin held against the fair value amounts recognized for derivative instruments executed with the same counterparties under master netting arrangements.
Schedule Of Fair Values Of Outstanding Derivative Contracts Recorded As Liabilities |
Liability Derivatives |  | Level |  |  | March 31, 2012 |  |  | December 31, 2011 |
Derivatives designated as hedging instruments: |  |  |  |  |  |  |  |  |  |  |  |
Other current liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 1 |  |  | $ | 13 |  |  | $ | 47 |
Aluminum contracts |  |  | 3 |  |  |  | 38 |  |  |  | 32 |
Energy contracts |  |  | 1 |  |  |  | 1 |  |  |  | — |
Other noncurrent liabilities and deferred credits: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 1 |  |  |  | 1 |  |  |  | 4 |
Aluminum contracts |  |  | 3 |  |  |  | 636 |  |  |  | 570 |
Energy contracts |  |  | 1 |  |  |  | 1 |  |  |  | — |
Energy contracts |  |  | 3 |  |  |  | 10 |  |  |  | — |
Total derivatives designated as hedging instruments |  |  |  |  |  | $ | 700 |  |  | $ | 653 |
Derivatives not designated as hedging instruments*: |  |  |  |  |  |  |  |  |  |  |  |
Other current liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 1 |  |  | $ | 6 |  |  | $ | 12 |
Aluminum contracts |  |  | 2 |  |  |  | 24 |  |  |  | 23 |
Other noncurrent liabilities and deferred credits: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 1 |  |  |  | — |  |  |  | 1 |
Aluminum contracts |  |  | 2 |  |  |  | 23 |  |  |  | 21 |
Embedded credit derivative |  |  | 3 |  |  |  | 28 |  |  |  | 28 |
Total derivatives not designated as hedging instruments |  |  |  |  |  | $ | 81 |  |  | $ | 85 |
Less margin posted**: |  |  |  |  |  |  |  |  |  |  |  |
Other current liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 1 |  |  | $ | — |  |  | $ | 1 |
Total Liability Derivatives |  |  |  |  |  | $ | 781 |  |  | $ | 737 |
* | See the "Other" section within Note L for additional information on Alcoa's purpose for entering into derivatives not designated as hedging instruments and its overall risk management strategies.
** | All margin posted is in the form of cash and is valued under a Level 1 technique. The levels that correspond to the margin posted in the table above reference the level of the corresponding liability for which it is posted. Alcoa elected to net the margin posted against the fair value amounts recognized for derivative instruments executed with the same counterparties under master netting arrangements.
Schedule Of Derivative Contract Assets And Liabilities That Are Measured And Recognized At Fair Value On A Recurring Basis |
|  | March 31, 2012 |  |  | December 31, 2011 |
Assets: |  |  |  |  |  |  |  |
Level 1 |  | $ | 46 |  |  | $ | 57 |
Level 2 |  |  | 45 |  |  |  | 47 |
Level 3 |  |  | 8 |  |  |  | 12 |
Margin held |  |  | (18 | ) |  |  | (22 | )
Total |  | $ | 81 |  |  | $ | 94 |
Liabilities: |  |  |  |  |  |  |  |
Level 1 |  | $ | 22 |  |  | $ | 64 |
Level 2 |  |  | 47 |  |  |  | 44 |
Level 3 |  |  | 712 |  |  |  | 630 |
Margin posted |  |  | — |  |  |  | (1 | )
Total |  | $ | 781 |  |  | $ | 737 |
Schedule Of Reconciliation Of Activity For Derivative Contracts |
|  | Assets |  |  | Liabilities |
|  | Aluminum contracts |  |  | Energy contracts |  |  | Aluminum contracts |  |  | Embedded credit derivative |  |  | Energy contracts |
Opening balance – December 31, 2011 |  | $ | 10 |  |  | $ | 2 |  |  | $ | 602 |  |  | $ | 28 |  |  | $ | — |
Total gains or losses (realized and unrealized) included in: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Sales – (decrease) |  |  | (3 | ) |  |  | — |  |  |  | (10 | ) |  |  | — |  |  |  | — |
Other income, net – (increase) |  |  | (1 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Other comprehensive income – decrease (increase) |  |  | 2 |  |  |  | (2 | ) |  |  | 82 |  |  |  | — |  |  |  | 10 |
Purchases, sales, issuances, and settlements* |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Transfers into and (or) out of Level 3* |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Closing balance – March 31, 2012 |  | $ | 8 |  |  | $ | — |  |  | $ | 674 |  |  | $ | 28 |  |  | $ | 10 |
Change in unrealized gains or losses included in earnings for derivative contracts held at March 31, 2012: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Sales |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Cost of goods sold |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Other income, net – (increase) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (1 | ) |  |  | — |
* | There were no purchases, sales, issuances or settlements of Level 3 financial instruments. Additionally, there were no transfers of financial instruments into or out of Level 3.
Schedule Of Quantitative Information For Level 3 Derivative Contracts |
|  | Fair value at March 31, 2012 |  |  | Valuation technique |  | Unobservable input |  | Range ($ in full amounts)
Assets: |  |  |  |  |  |  |  |  |  |
Aluminum contract |  | $ | 4 |  |  | Discounted cash flow |  | Interrelationship of future aluminum and oil prices |  | Aluminum: $2,152 - $2,605 per metric ton Oil: $91 - $120 per barrel
Liabilities: |  |  |  |  |  |  |  |  |  |
Aluminum contracts |  |  | 670 |  |  | Discounted cash flow |  | Price of aluminum beyond forward curve |  | $2,793 per metric ton in 2022 to $3,057 per metric ton in 2027
Embedded credit derivative |  |  | 28 |  |  | Discounted cash flow |  | Credit spread between Alcoa and counterparty |  | 1.64% - 2.02% (1.83%) median
Energy contracts |  |  | 10 |  |  | Discounted cash flow |  | Price of electricity beyond forward curve |  | $48 per megawatt hour in 2012 to $172 per megawatt hour in 2036
Schedule Of Gain Or Loss On Hedged Items And Derivative Contracts |
Derivatives in Fair Value Hedging Relationships |  | Location of Gain or (Loss) Recognized in Earnings on Derivatives |  | Amount of Gain or (Loss) Recognized in Earnings on Derivatives |
|  | First quarter ended March 31, |
|  | 2012 |  |  | 2011 |
Aluminum contracts |  | Sales |  | $ | 36 |  |  | $ | 49 |
Interest rate contracts |  | Interest expense |  |  | 3 |  |  |  | 11 |
Total |  |  |  | $ | 39 |  |  | $ | 60 |
Hedged Items in Fair Value Hedging Relationships |  | Location of Gain or (Loss) Recognized in Earnings on Hedged Items |  | Amount of Gain or (Loss) Recognized in Earnings on Hedged Items |
|  | First quarter ended March 31, |
|  | 2012 |  |  | 2011 |
Aluminum contracts |  | Sales |  | $ | (48 | ) |  | $ | (52 | )
Interest rate contracts |  | Interest expense |  |  | (3 | ) |  |  | (11 | )
Total |  |  |  | $ | (51 | ) |  | $ | (63 | )
Schedule Of Gains And Losses On Derivative Representing Either Hedge Ineffectiveness Or Hedge Components Excluded From Assessment Of Effectiveness Are Recognized In Current Earnings |
Derivatives in Cash Flow Hedging Relationships |  | Amount of Gain or (Loss) Recognized in OCI on Derivatives (Effective Portion) |  |  | Location of Gain or (Loss) Reclassified from Accumulated OCI into Earnings (Effective Portion) |  | Amount of Gain or (Loss) Reclassified from Accumulated OCI into Earnings (Effective Portion)* |  |  | Location of Gain or (Loss) Recognized in Earnings on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) |  | Amount of Gain or (Loss) Recognized in Earnings on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing)** |
| First quarter ended March 31, |  |  |  | First quarter ended March 31, |  |  |  | First quarter ended March 31, |
| 2012 |  |  | 2011 |  |  |  | 2012 |  |  | 2011 |  |  |  | 2012 |  |  | 2011 |
Aluminum contracts |  | $ | (79 | ) |  | $ | (189 | ) |  | Sales |  | $ | — |  |  | $ | (38 | ) |  | Other income, net |  | $ | 7 |  |  | $ | 1 |
Energy contracts |  |  | (5 | ) |  |  | — |  |  | Cost of goods sold |  |  | — |  |  |  | (3 | ) |  | Other income, net |  |  | — |  |  |  | — |
Foreign exchange contracts |  |  | — |  |  |  | 1 |  |  | Sales |  |  | — |  |  |  | 1 |  |  | Other income, net |  |  | — |  |  |  | — |
Interest rate contracts |  |  | 2 |  |  |  | — |  |  | Interest expense |  |  | — |  |  |  | — |  |  | Other income, net |  |  | — |  |  |  | — |
Interest rate contracts |  |  | — |  |  |  | — |  |  | Other income, net |  |  | (1 | ) |  |  | — |  |  | Other income, net |  |  | — |  |  |  | — |
Total |  | $ | (82 | ) |  | $ | (188 | ) |  |  |  | $ | (1 | ) |  | $ | (40 | ) |  |  |  | $ | 7 |  |  | $ | 1 |
* | Assuming market rates remain constant with the rates at March 31, 2012, a loss of $4 is expected to be recognized in earnings over the next 12 months.
** | For the first quarter ended March 31, 2012 and 2011, the amount of gain or (loss) recognized in earnings represents $9 and $1, respectively, related to the ineffective portion of the hedging relationships. There was also $(2) recognized in earnings related to the amount excluded from the assessment of hedge effectiveness for the first quarter ended March 31, 2012.
Schedule Of Outstanding Forward Contracts That Were Entered Into Hedge Forecasted Transactions |
|  | March 31, |  |  | December 31, |
|  | 2012 |  |  | 2011 |
Aluminum contracts (kmt) |  |  | 1,342 |  |  |  | 1,294 |
Energy contracts: |  |  |  |  |  |  |  |
Electricity (megawatt hours) |  |  | 100,578,295 |  |  |  | 100,578,295 |
Natural gas (million British thermal units) |  |  | 18,540,000 |  |  |  | — |
Schedule Of Fair Value Gains And Losses On Derivatives Contracts Recorded In Earnings |
Derivatives Not Designated as Hedging Instruments |  | Location of Gain or (Loss) Recognized in Earnings on Derivatives |  | Amount of Gain or (Loss) Recognized in Earnings on Derivatives
|  |  |  | First quarter ended March 31, |  |  |
|  |  |  | 2012 |  |  | 2011 |  |  |
Aluminum contracts |  | Sales |  |  |  | $ | 3 |  |  | $ | 3 |  |  |
Aluminum contracts |  | Other income, net |  |  |  |  | (7 | ) |  |  | (14 | ) |  |
Embedded credit derivative |  | Other income, net |  |  |  |  | — |  |  |  | 9 |  |  |
Energy contract |  | Other income, net |  |  |  |  | — |  |  |  | 12 |  |  |
Foreign exchange contracts |  | Other income, net |  |  |  |  | 1 |  |  |  | 2 |  |  |
Total |  |  |  |  |  | $ | (3 | ) |  | $ | 12 |  |  |
Schedule Of Carrying Values And Fair Values Of Other Financial Instruments |
|  | March 31, 2012 |  |  | December 31, 2011 |
|  | Carrying value |  |  | Fair value |  |  | Carrying value |  |  | Fair value |
Cash and cash equivalents |  | $ | 1,749 |  |  | $ | 1,749 |  |  | $ | 1,939 |  |  | $ | 1,939 |
Restricted cash |  |  | 34 |  |  |  | 34 |  |  |  | 25 |  |  |  | 25 |
Noncurrent receivables |  |  | 21 |  |  |  | 21 |  |  |  | 30 |  |  |  | 30 |
Available-for-sale securities |  |  | 84 |  |  |  | 84 |  |  |  | 92 |  |  |  | 92 |
Short-term borrowings |  |  | 722 |  |  |  | 722 |  |  |  | 62 |  |  |  | 62 |
Commercial paper |  |  | 275 |  |  |  | 275 |  |  |  | 224 |  |  |  | 224 |
Long-term debt due within one year |  |  | 128 |  |  |  | 128 |  |  |  | 445 |  |  |  | 445 |
Long-term debt, less amount due within one year |  |  | 8,618 |  |  |  | 9,518 |  |  |  | 8,640 |  |  |  | 9,274 |

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