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DERIVATIVES | 12 Months Ended
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Aug. 31, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
DERIVATIVES | NOTE 10. DERIVATIVES The Company's global operations and product lines expose it to risks from fluctuations in metal commodity prices, foreign currency exchange rates, interest rates and natural gas, electricity and other energy prices. One objective of the Company's risk management program is to mitigate these risks using derivative instruments. The Company enters into (i) metal commodity futures and forward contracts to mitigate the risk of unanticipated changes in net earnings due to price volatility in these commodities, (ii) foreign currency forward contracts that match the expected settlements for purchases and sales denominated in foreign currencies and (iii) natural gas and electricity commodity derivatives to mitigate the risk related to price volatility of these commodities. The Company designates only those contracts which closely match the terms of the underlying transaction as hedges for accounting purposes. Certain foreign currency and commodity contracts were not designated as hedges for accounting purposes, although management believes they are essential economic hedges. The Company considers the total notional value of its futures and forward contracts as the best measure of the volume of derivative transactions. At August 31, 2024 and 2023, the notional values of the Company's commodity contract commitments were $480.1 million and $456.4 million, respectively. At August 31, 2024 and 2023, the notional values of the Company's foreign currency contract commitments were $225.1 million and $221.4 million, respectively. The following table provides information regarding the Company's commodity contract commitments as of August 31, 2024:
Commodity |  | Position |  | Total
Aluminum |  | Long |  | 1,225 |  |  | MT
Copper |  | Long |  | 624 |  |  | MT
Copper |  | Short |  | 9,321 |  |  | MT
Electricity |  | Long |  | 3,112,000 |  |  | MW(h)
Natural Gas |  | Long |  | 5,190,700 |  |  | MMBtu
__________________________________ MT = Metric ton MW(h) = Megawatt hour MMBtu = Metric Million British thermal unit The following table summarizes the location and amounts of the fair value of the Company's derivative instruments reported in the consolidated balance sheets:
(in thousands) |  | Primary Location |  | August 31, 2024 |  | August 31, 2023
Derivative assets: |  |  |  |  |  |
Commodity |  | Prepaid and other current assets |  | $ | 9,823 |  |  | $ | 11,427 |
Commodity |  | Other noncurrent assets |  | 30,402 |  |  | 184,261 |
Foreign exchange |  | Prepaid and other current assets |  | 419 |  |  | 1,898 |
Derivative liabilities: |  |  |  |  |  |
Commodity |  | Accrued expenses and other payables |  | $ | 3,445 |  |  | $ | 2,983 |
Commodity |  | Other noncurrent liabilities |  | 157 |  |  | 1,085 |
Foreign exchange |  | Accrued expenses and other payables |  | 1,885 |  |  | 2,566 |
The decrease in fair value of the Company's commodity derivatives reported within other noncurrent assets is primarily due to the decrease in the value of a significant input used to measure the fair value of the Company's Level 3 commodity derivatives at August 31, 2024 as compared to August 31, 2023. See Note 11, Fair Value, for further discussion of the measurement of the fair value of the Company's Level 3 commodity derivatives. The following table summarizes activities related to the Company's derivatives not designated as hedging instruments recognized in the consolidated statements of earnings. All other activity related to the Company's derivatives not designated as hedging instruments was immaterial for the periods presented.
|  |  |  | Year Ended August 31,
Gain (Loss) on Derivatives Not Designated as Hedging Instruments (in thousands) |  | Primary Location |  | 2024 |  | 2023 |  | 2022
Commodity |  | Cost of goods sold |  | $ | (10,195) |  |  | $ | (3,028) |  |  | $ | 15,862 |
Foreign exchange |  | SG&A expenses |  | 6,974 |  |  | 12,265 |  |  | (6,547) |
The following table summarizes activities related to the Company's derivatives designated as cash flow hedging instruments recognized in the consolidated statements of comprehensive income and consolidated statements of earnings. Amounts presented do not include the effects of foreign currency translation adjustments.
Effective Portion of Derivatives Designated as Cash Flow Hedging Instruments Gain (Loss) Recognized in OCI, Net of Income Taxes (in thousands) |  | Year Ended August 31,
| 2024 |  | 2023 |  | 2022
Commodity |  | $ | (129,709) |  |  | $ | 6,367 |  |  | $ | 138,534 |
Foreign exchange |  | 31 |  |  | 28 |  |  | 100 |
Gain on Derivatives Designated as Cash Flow Hedging Instruments Reclassified from AOCI into Net Earnings (in thousands) |  |  |  | Year Ended August 31,
| Primary Location |  | 2024 |  | 2023 |  | 2022
Commodity |  | Cost of goods sold |  | $ | 2,031 |  |  | $ | 11,325 |  |  | $ | 27,267 |
Foreign exchange |  | SG&A expenses |  | 250 |  |  | 244 |  |  | 244 |
The Company's natural gas commodity derivatives accounted for as cash flow hedging instruments have maturities extending to August 2027. The Company's electricity commodity derivatives accounted for as cash flow hedging instruments have maturities extending to December 2034. Included in the AOCI balance as of August 31, 2024 was an estimated net gain of $4.8 million from cash flow hedging instruments that is expected to be reclassified into net earnings within the twelve months following August 31, 2024. Cash flows associated with the cash flow hedging instruments are recorded as a component of cash flows from operating activities in the consolidated statements of cash flows. See Note 11, Fair Value, for the fair value of the Company's derivative instruments recorded in the consolidated balance sheets.

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