XML 42 R26.htm IDEA: XBRL DOCUMENT
v3.22.4

Derivatives | 12 Months Ended
--- | ---
Dec. 31, 2022
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivatives | DerivativesAs of December 31, 2022, we had an open position of 111,741 tonnes related to LME forward financial sales contracts to fix the forward LME aluminum price. These contracts are expected to settle monthly through December 2024. We had no open MWP forward financial sales contracts as of December 31, 2022. We have also entered into financial contracts with various counterparties to offset fixed price sales arrangements with certain of our customers ("fixed for floating swaps") to remain exposed to the LME and MWP aluminum prices. As of December 31, 2022, we had 946 tonnes related to fixed for floating swaps that will settle monthly through September 2023. We have entered into financial contracts to hedge a portion of Grundartangi's exposure to the Nord Pool power market (“Nord Pool power price swaps”). The Nord Pool power price swaps are expected to settle monthly through December 2023. The Nord Pool power price swaps are settled in Euros, therefore we have entered into financial contracts to hedge the risk of fluctuations associated with the Euro ("FX swaps"). As of December 31, 2022, we had an open position related to the FX swaps of €32.7 million that will settle monthly through December 2023. During the third quarter of 2022, we entered certain floating Nord Pool financial contracts to unwind a portion of our fixed contract position as a result of the recent power agreement amendment, making us predominantly hedged against Nord Pool power price fluctuations during 2023. The pricing relationship between the fixed and floating contracts created a realized gain of $16.0 million, which we recognized for the year ended December 31, 2022. As of December 31, 2022, we had an open net position of 989,880 MWh related to the Nord Pool power price swaps. We have entered into financial contracts to fix a portion of our exposure to the Indiana Hub power market at our Kentucky plants ("Indiana Hub power price swaps"). As of December 31, 2022, we had an open position of 175,200 MWh. The Indiana Hub power price swaps are expected to settle monthly through December 2023. We have entered into forward contracts to hedge the risk of fluctuations associated with the Icelandic Krona (ISK) and Euro for contracts related to the construction of the Grundartangi casthouse denominated in these currencies ("casthouse currency hedges"). As of December 31, 2022, we had an open position related to the ISK casthouse swaps of 5.5 billion ISK that will settle monthly through July 2023. As of December 31, 2022, we had an open position related to the Euro casthouse swaps of €8.9 million that will settle monthly through February 2024. Our agreements with derivative counterparties contain certain provisions requiring collateral to be posted in the event the market value of our position exceeds the margin threshold limit of our master agreement with the counterparty. As of December 31, 2022 and December 31, 2021, the Company had recorded restricted cash of $0.0 million and $8.6 million, respectively, as collateral related to open derivative contracts under the master arrangements with our counterparties. The following table sets forth the Company's derivative assets and liabilities that were accounted for at fair value and not designated as cash flow hedges as of December 31, 2022 and 2021, respectively:
| Asset Fair Value
| 2022 |  | 2021
Commodity contracts (1) | 129.1 |  |  | $ | 42.9 |
Foreign exchange contracts (2) | — |  |  | — |
Total | $ | 129.1 |  |  | $ | 42.9 |
| Liability Fair Value
| 2022 |  | 2021
Commodity contracts (1) | 23.7 |  |  | 143.3 |
Foreign exchange contracts (2) | 7.3 |  |  | 2.9 |
Total | $ | 31.0 |  |  | $ | 146.2 |
(1) Commodity contracts reflect our outstanding LME forward financial sales contracts, MWP forward financial sales contracts, fixed for floating swaps, Nord Pool power price swaps, and Indiana Hub power price swaps. At December 31, 2022, $11.9 million of Due to affiliates and $8.3 million of Due to affiliates - less current portion was related to commodity contract liabilities with Glencore. At December 31, 2021, $17.1 million of Due to affiliates, and $21.9 million of Due to affiliates - less current portion was related to commodity contract liabilities with Glencore. (2) Foreign exchange contracts reflect our outstanding FX swaps and casthouse currency hedges. The following table summarizes the net gain (loss) on forward and derivative contracts for the years ended December 31, 2022, 2021, and 2020:
| Year Ended December 31,
| 2022 |  | 2021 |  | 2020
Commodity contracts (1) | $ | 206.6 |  |  | $ | (208.0) |  |  | $ | (16.3) |
Foreign exchange contracts | (9.4) |  |  | (4.4) |  |  | (1.0) |
Total | $ | 197.2 |  |  | $ | (212.4) |  |  | $ | (17.3) |
(1) For the years ended December 31, 2022, 2021, and 2020, $(13.3) million, $116.9 million, and $(9.2) million of net gain (loss), respectively, was with Glencore.

X
- References No definition available. + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI https://asc.fasb.org/topic&trid=2229140 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -SubTopic 40 -Section 50 -Paragraph 5 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126731327&loc=d3e90205-114008 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration