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FAIR VALUE
 12 Months Ended
Aug. 31, 2024
Fair Value Disclosures [Abstract]  
FAIR VALUE
NOTE 11. FAIR VALUE

The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. See Note 1, Nature of Operations and Summary of Significant Accounting Policies, for definitions of the three levels within the hierarchy.

The Company presents the fair value of its derivative contracts on a net-by-counterparty basis when a legal right to offset exists under an enforceable netting agreement. The following tables summarize information regarding the Company's financial assets and financial liabilities that were measured at fair value on a recurring basis:
  Fair Value Measurements at Reporting Date Using
(in thousands)TotalQuoted Prices in
Active Markets for
Identical Assets
(Level 1)		Significant Other
Observable Inputs
(Level 2)		Significant
Unobservable Inputs
(Level 3)
As of August 31, 2024:
Assets:
Investment deposit accounts(1)
$718,110 $718,110 $— $— 
Commodity derivative assets(2)
40,225 2,196 — 38,029 
Foreign exchange derivative assets(2)
419 — 419 — 
Liabilities:
Commodity derivative liabilities(2)
3,602 3,602 — — 
Foreign exchange derivative liabilities(2)
1,885 — 1,885 — 
As of August 31, 2023:
Assets:
Investment deposit accounts(1)
$508,227 $508,227 $— $— 
Commodity derivative assets(2)
195,689 1,264 — 194,425 
Foreign exchange derivative assets(2)
1,898 — 1,898 — 
Liabilities:
Commodity derivative liabilities(2)
4,068 4,068 — — 
Foreign exchange derivative liabilities(2)
2,566 — 2,566 — 
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(1) Investment deposit accounts are short-term in nature, and the value is determined by principal plus interest. The investment portfolio mix can change each period based on the Company's assessment of investment options.
(2) Derivative assets and liabilities classified as Level 1 are commodity futures contracts valued based on quoted market prices in the London Metal Exchange or the New York Mercantile Exchange. Amounts in Level 2 are based on broker quotes in the over-the-counter market. Derivatives classified as Level 3 are described below. Further discussion regarding the Company's use of derivative instruments is included in Note 10, Derivatives.

As of August 31, 2022, the Company had one Level 3 commodity derivative. The Company entered into its second and third Level 3 commodity derivatives in September 2022 and January 2023, respectively, with the same counterparty as the first Level 3 commodity derivative. Both the second and third Level 3 commodity derivatives will begin to settle in January 2025.

The fair value estimate of the Level 3 commodity derivatives are based on internally developed discounted cash flow models primarily utilizing unobservable inputs in which there is little or no market data. The Company forecasts future energy rates using a range of historical prices (the "floating rate"), which is the only significant unobservable input used in the Company's discounted cash flow models. Significantly higher or lower floating rates could have resulted in a material difference in the fair value measurement. The following table summarizes the range of floating rates used to measure the fair value of the Level 3 commodity derivatives at August 31, 2024 and 2023, which are applied uniformly across each of our Level 3 commodity derivatives:

Floating Rate (PLN)
LowHighAverage
August 31, 2024324 510 405 
August 31, 2023480 855 630 

Below is a reconciliation of the beginning and ending balances of the Level 3 commodity derivatives recognized in the consolidated statements of comprehensive income. Amounts presented are before income taxes. The fluctuation in energy rates over time may cause volatility in the fair value estimate and is the primary reason for the unrealized gains and losses in OCI in 2024, 2023 and 2022.
(in thousands)Level 3 Commodity Derivatives
Balance, September 1, 2021$26,413 
Unrealized holding gain before reclassification(1)
138,760 
Reclassification for gain included in net earnings(2)
(21,673)
Balance at August 31, 2022143,500 
Unrealized holding gain before reclassification(1)
62,706 
Reclassification for gain included in net earnings(2)
(11,781)
Balance at August 31, 2023194,425 
Unrealized holding loss before reclassification(1)
(148,533)
Reclassification for gain included in net earnings(2)
(7,863)
Balance at August 31, 2024$38,029 
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(1) Unrealized holding gain (loss), net of foreign currency translation, less amounts reclassified are included in net unrealized holding gain (loss) on derivatives in the consolidated statements of comprehensive income.
(2) Gains included in net earnings are recorded in cost of goods sold in the consolidated statements of earnings.

During the fourth quarter of 2024, the Company committed to a plan to sell a rebar fabrication facility within the North America Steel Group segment and determined that the disposal group met the criteria to be classified as held for sale. Accordingly, the Company classified $17.5 million of assets and $4.1 million of liabilities as held for sale within the Company's consolidated balance sheet as of August 31, 2024. The liabilities held for sale are recorded within accrued expenses and other payables. Upon concluding that the disposal group met the held for sale criteria, the Company recorded an impairment charge of $6.6 million to record the disposal group at the lower of its carrying value or fair value less costs to sell. The Company determined the fair value of the disposal group using a Level 2 input, based on a quoted price in an inactive market. There were no other material non-recurring fair value remeasurements in 2024 or 2023.
The carrying values of the Company's short-term items, including documentary letters of credit and notes payable, approximate fair value.

The carrying value and fair value of the Company's long-term debt, including current maturities, excluding other borrowings and finance leases, was $1.0 billion and $962.8 million, respectively, at August 31, 2024, and $1.0 billion and $900.9 million, respectively, at August 31, 2023. The Company estimates these fair values based on Level 2 of the fair value hierarchy using indicated market values. The Company's other borrowings contain variable interest rates, and as a result, their carrying values approximate fair values.