Derivatives

12 Months Ended

Dec. 31, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

As of December 31, 2023, we had an open position of 36,633 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 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, 2023, we had 318 tonnes related to fixed for floating swaps that will settle monthly through February 2024.

We previously 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 settled in Euros; therefore, we entered into financial contracts to hedge the risk of fluctuations associated with the Euro ("FX swaps"). During the third quarter of 2022, we entered certain floating Nord Pool financial contracts to unwind a portion of our fixed contract position, making us predominantly hedged against Nord Pool power price fluctuations during 2023. As of December 31, 2023, we had no open Nord Pool power price swaps.

We previously 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, 2023, we had no open Indiana Hub power price swaps.

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 and the Sebree casthouse project denominated in these currencies ("casthouse currency hedges"). As of December 31, 2023, we had an open position related to the ISK casthouse swaps of kr397.0 million and an open position related to the Euro casthouse swaps of €1.8 million that will settle through January 2024.

We previously entered into financial contracts to hedge a portion of our exposure at our operations to the NYMEX Henry Hub (“NYMEX Henry Hub natural gas price swaps”). The natural gas volume is measured per million British Thermal Units ("MMBtu"). As of December 31, 2023, we had no open NYMEX Henry Hub natural gas price swaps.

We have entered into financial contracts to hedge a portion of our exposure at our operations to Heavy Fuel Oil (“HFO price swaps”). The HFO volume is measured per barrel. As of December 31, 2023, we had an open position of 180,000 barrels. The HFO price swaps are expected to settle monthly through March 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, 2023 and December 31, 2022, we had no recorded restricted cash 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, 2023 and 2022, respectively:


	Asset Fair Value
	2023		2022
Commodity contracts (1)	$	2.9	$	129.1
Foreign exchange contracts (2)	—		—
Total	$	2.9	$	129.1


	Liability Fair Value
	2023		2022
Commodity contracts (1)	7.8		23.7
Foreign exchange contracts (2)	0.1		7.3
Total	$	7.9	$	31.0

(1)Commodity contracts reflect our outstanding LME forward financial sales contracts, fixed for floating swaps, Nord Pool power price swaps, HFO price swaps and Indiana Hub power price swaps. At December 31, 2023, $6.4 million of Due to affiliates was related to commodity contract liabilities with Glencore. 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.

(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, 2023, 2022, and 2021:


	Year Ended December 31,
	2023		2022		2021
Commodity contracts (1)	$	63.5	$	206.6	$	(208.0)
Foreign exchange contracts	(1.7)		(9.4)		(4.4)
Total	$	61.8	$	197.2	$	(212.4)

(1)For the years ended December 31, 2023, 2022, and 2021, $0.6 million, $(13.3) million, and $116.9 million of net gain (loss), respectively, was with Glencore.