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Derivatives, Hedging Programs and Other Financial Instruments (Tables) | 12 Months Ended
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Dec. 31, 2020
Derivative Instruments And Hedging Activities Disclosure [Abstract] |
Summary of Derivative Positions | The following table summarizes our derivative positions at December 31, 2020:
Aluminum |  | Maturity Period (month/year) |  | Notional Amount of Contracts (mmlbs) |
Fixed price purchase contracts |  | 1/21 through 12/22 |  |  | 67.4 |
Fixed price sales contracts |  | 1/21 through 11/21 |  |  | 0.8 |
Midwest premium swap contracts1 |  | 1/21 through 12/22 |  |  | 66.4 |
Alloying Metals |  | Maturity Period (month/year) |  | Notional Amount of Contracts (mmlbs) |
Fixed price purchase contracts |  | 1/21 through 12/21 |  |  | 10.2 |
Fixed price sales contracts |  | 1/21 through 12/21 |  |  | 4.3 |
Natural Gas |  | Maturity Period (month/year) |  | Notional Amount of Contracts (mmbtu) |
Fixed price purchase contracts |  | 1/21 through 12/24 |  |  | 6,630,000 |
Electricity |  | Maturity Period (month/year) |  | Notional Amount of Contracts (Mwh) |
Fixed price purchase contracts |  | 1/21 through 12/22 |  |  | 481,800 |
1. | Regional premiums represent the premium over the London Metal Exchange price for primary aluminum which is incurred on our purchases of primary aluminum.
Summary of Loss (Gain) Associated with Derivative Contracts | The following table summarizes the amount of loss (gain) included on our Statements of Consolidated Income associated with all derivative contracts (in millions of dollars):
|  | Year Ended December 31, |  |  | Statements of Consolidated
|  | 2020 |  |  | 2019 |  |  | 2018 |  |  | Income Classification
Total of income and expense line items presented in our Statements of Consolidated Income in which the effects of hedges are recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash flow hedges |  | $ | 941.3 |  |  | $ | 1,215.2 |  |  | $ | 1,300.7 |  |  | Cost of products sold
Fair value hedges |  | $ | 52.2 |  |  | n/a |  |  | n/a |  |  | Depreciation and amortization
Fair value hedges (early termination) |  | $ | 1.4 |  |  | n/a |  |  | n/a |  |  | Other expense, net
Loss (gain) recognized in our Statements of Consolidated Income related to cash flow hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Aluminum |  | $ | 13.7 |  |  | $ | 18.4 |  |  | $ | 2.1 |  |  | Cost of products sold
Alloying Metals (effective hedges) |  |  | 1.4 |  |  |  | 1.1 |  |  |  | 1.0 |  |  | Cost of products sold
Alloying Metals (reclassification from AOCI due to forecasted transactions no longer probable of occurring) |  |  | 0.8 |  |  |  | — |  |  |  | — |  |  | Cost of products sold
Natural gas |  |  | 1.3 |  |  |  | 0.2 |  |  |  | (0.3 | ) |  | Cost of products sold
Electricity |  |  | 0.5 |  |  |  | — |  |  |  | — |  |  | Cost of products sold
Total loss recognized in our Statements of Consolidated Income related to cash flow hedges |  | $ | 17.7 |  |  | $ | 19.7 |  |  | $ | 2.8 |  |  |
(Gain) loss recognized in our Statements of Consolidated Income related to fair value hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts |  | $ | (0.1 | ) |  | $ | — |  |  | $ | — |  |  | Depreciation and amortization
Hedged item |  |  | 0.1 |  |  |  | — |  |  |  | — |  |  | Depreciation and amortization
Excluded component amortized from AOCI |  |  | 0.4 |  |  |  | — |  |  |  | — |  |  | Depreciation and amortization
Reclassification from AOCI related to early termination of firm commitment |  |  | 0.6 |  |  |  | — |  |  |  | — |  |  | Other expense, net
Net settlement related to early termination of forward contracts |  |  | (0.7 | ) |  |  | — |  |  |  | — |  |  | Other expense, net
Total loss recognized in our Statements of Consolidated Income related to fair value hedges |  | $ | 0.3 |  |  | $ | — |  |  | $ | — |  |  |
Loss (gain) recognized in our Statements of Consolidated Income related to non-designated hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Alloying Metals – Realized loss |  | $ | 0.2 |  |  | $ | — |  |  | $ | — |  |  | Cost of products sold
Alloying Metals – Unrealized gain |  |  | (3.5 | ) |  |  | — |  |  |  | — |  |  | Cost of products sold
Total gain recognized in our Statements of Consolidated Income related to non-designated hedges: |  | $ | (3.3 | ) |  | $ | — |  |  | $ | — |  |  |
Schedule of Fair Value of Derivative Financial Instruments | The following table presents the fair value of our derivative financial instruments (in millions of dollars):
|  | As of December 31, 2020 |  |  | As of December 31, 2019 |
|  | Assets |  |  | Liabilities |  |  | Net Amount |  |  | Assets |  |  | Liabilities |  |  | Net Amount |
Cash Flow Hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Aluminum – |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed price purchase contracts |  | $ | 4.6 |  |  | $ | (0.1 | ) |  | $ | 4.5 |  |  | $ | 1.0 |  |  | $ | (4.1 | ) |  | $ | (3.1 | )
Midwest premium swap contracts |  |  | 0.2 |  |  |  | (1.2 | ) |  |  | (1.0 | ) |  |  | — |  |  |  | (1.2 | ) |  |  | (1.2 | )
Alloying Metals – |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed price purchase contracts |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 0.4 |  |  |  | (1.5 | ) |  |  | (1.1 | )
Natural gas – Fixed price purchase contracts |  |  | 0.2 |  |  |  | (1.5 | ) |  |  | (1.3 | ) |  |  | — |  |  |  | (2.8 | ) |  |  | (2.8 | )
Electricity – Fixed price purchase contracts |  |  | 2.0 |  |  |  | (2.5 | ) |  |  | (0.5 | ) |  |  | 2.6 |  |  |  | (1.6 | ) |  |  | 1.0 |
Total cash flow hedges |  |  | 7.0 |  |  |  | (5.3 | ) |  |  | 1.7 |  |  |  | 4.0 |  |  |  | (11.2 | ) |  |  | (7.2 | )
Non-Designated Hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Alloying Metals – |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed price purchase contracts |  |  | 3.9 |  |  |  | — |  |  |  | 3.9 |  |  |  | — |  |  |  | — |  |  |  | — |
Fixed price sales contracts |  |  | — |  |  |  | (1.3 | ) |  |  | (1.3 | ) |  |  | — |  |  |  | — |  |  |  | — |
Total non-designated hedges |  |  | 3.9 |  |  |  | (1.3 | ) |  |  | 2.6 |  |  |  | — |  |  |  | — |  |  |  | — |
Total |  | $ | 10.9 |  |  | $ | (6.6 | ) |  | $ | 4.3 |  |  | $ | 4.0 |  |  | $ | (11.2 | ) |  | $ | (7.2 | )
The following table presents the total amounts of derivative assets and liabilities on our Consolidated Balance Sheets (in millions of dollars):
|  | As of December 31, |
|  | 2020 |  |  | 2019 |
Derivative assets: |  |  |  |  |  |  |  |
Prepaid expenses and other current assets |  | $ | 8.4 |  |  | $ | 2.1 |
Other assets |  |  | 2.5 |  |  |  | 1.9 |
Total derivative assets |  | $ | 10.9 |  |  | $ | 4.0 |
Derivative liabilities: |  |  |  |  |  |  |  |
Other accrued liabilities |  | $ | (3.8 | ) |  | $ | (7.6 | )
Long-term liabilities |  |  | (2.8 | ) |  |  | (3.6 | )
Total derivative liabilities |  | $ | (6.6 | ) |  | $ | (11.2 | )
Schedule of Other Financial Assets Classifies under Appropriate Level of Fair Value Hierarchy | The following table classifies our other financial assets under the appropriate level of the fair value hierarchy as of December 31, 2020 (in millions of dollars):
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Cash and cash equivalents |  | $ | 780.3 |  |  | $ | — |  |  | $ | — |  |  | $ | 780.3 |
Total |  | $ | 780.3 |  |  | $ | — |  |  | $ | — |  |  | $ | 780.3 |
The following table classifies our other financial assets under the appropriate level of the fair value hierarchy as of December 31, 2019 (in millions of dollars):
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Cash and cash equivalents |  | $ | 28.2 |  |  | $ | 236.1 |  |  | $ | — |  |  | $ | 264.3 |
Short-term investments |  |  | — |  |  |  | 78.7 |  |  |  | — |  |  |  | 78.7 |
Total |  | $ | 28.2 |  |  | $ | 314.8 |  |  | $ | — |  |  | $ | 343.0 |

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