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Derivatives, Hedging Programs and Other Financial Instruments (Tables) | 9 Months Ended
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Sep. 30, 2021
Derivative Instruments And Hedging Activities Disclosure [Abstract] |
Summary of Volume of Derivative and or Physical Delivery Commitments with Energy Companies | The following table summarizes the volume of our derivative and/or physical delivery commitments with energy companies in place to cover our exposure to price fluctuations of our expected variable priced energy purchases as of September 30, 2021:
|  | Remainder of 2021 |  |  | 2022 |  |  | 2023 |  |  | 2024 |  |  | 2025 |  |  | 2026 |
Natural Gas |  | 44% |  |  | 49% |  |  | 44% |  |  | 42% |  |  | 18% |  |  | 18% |
Electricity |  | 92% |  |  | 75% |  |  | 43% |  |  |  | — |  |  |  | — |  |  |  | — |
Summary of Derivative Positions | The following table summarizes our derivative positions at September 30, 2021:
Aluminum |  | Maturity Period (month/year) |  | Notional Amount of Contracts (mmlbs) |
Fixed price purchase contracts |  | 10/21 through 12/23 |  |  | 97.8 |
Fixed price sales contracts |  | 10/21 through 12/21 |  |  | 0.8 |
Midwest premium swap contracts1 |  | 10/21 through 12/23 |  |  | 81.1 |
Alloying Metals |  | Maturity Period (month/year) |  | Notional Amount of Contracts (mmlbs) |
Fixed price purchase contracts |  | 10/21 through 12/22 |  |  | 9.4 |
Fixed price sales contracts |  | 10/21 through 12/21 |  |  | 1.8 |
Natural Gas |  | Maturity Period (month/year) |  | Notional Amount of Contracts (mmbtu) |
Fixed price purchase contracts |  | 10/21 through 12/24 |  |  | 5,220,000 |
Electricity |  | Maturity Period (month/year) |  | Notional Amount of Contracts (Mwh) |
Fixed price purchase contracts |  | 10/21 through 12/22 |  |  | 285,270 |
Euro |  | Maturity Period (month/year) |  | Notional Amount of Contracts (euro) |
Fixed price forward contracts |  | 12/21 through 3/23 |  |  | 208,080 |
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 (Gain) Loss Associated with Derivative Contracts | The following table summarizes the amount of (gain) loss included on our Statements of Consolidated (Loss) Income associated with all derivative contracts (in millions of dollars):
|  | Quarter Ended September 30, |  |  |  | Nine Months Ended September 30, |  |  |  | Statements of Consolidated
|  | 2021 |  |  | 2020 |  |  |  | 2021 |  |  | 2020 |  |  |  | (Loss) Income Classification
Total of income and expense line items presented in our Statements of Consolidated (Loss) Income in which the effects of hedges are recorded: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash flow hedges |  | $ | 677.8 |  |  | $ | 208.4 |  |  |  | $ | 1,613.6 |  |  | $ | 719.5 |  |  |  | Cost of products sold
Fair value hedges |  | n/a |  |  | $ | 12.9 |  |  |  | n/a |  |  | $ | 39.1 |  |  |  | Depreciation and amortization
Fair value hedges |  | n/a |  |  | $ | (0.5 | ) |  |  | n/a |  |  | $ | (0.8 | ) |  |  | Other expense, net
(Gain) loss recognized in our Statements of Consolidated (Loss) Income related to cash flow hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Aluminum |  | $ | (13.3 | ) |  | $ | 1.2 |  |  |  | $ | (24.3 | ) |  | $ | 14.5 |  |  |  | Cost of products sold
Alloying Metals |  |  | (0.2 | ) |  |  | — |  |  |  |  | 0.2 |  |  |  | 2.1 |  |  |  | Cost of products sold
Alloying Metals (reclassification from AOCI due to forecasted transactions no longer probable of occurring) |  |  | — |  |  |  | 0.1 |  |  |  |  | — |  |  |  | 0.8 |  |  |  | Cost of products sold
Natural gas |  |  | (0.6 | ) |  |  | 0.3 |  |  |  |  | (0.7 | ) |  |  | 1.2 |  |  |  | Cost of products sold
Electricity |  |  | (2.6 | ) |  |  | — |  |  |  |  | (3.3 | ) |  |  | 0.6 |  |  |  | Cost of products sold
Total (gain) loss recognized in our Statements of Consolidated (Loss) Income related to cash flow hedges |  | $ | (16.7 | ) |  | $ | 1.6 |  |  |  | $ | (28.1 | ) |  | $ | 19.2 |  |  |  |
Loss (gain) recognized in our Statements of Consolidated (Loss) 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 |  |  | — |  |  |  | — |  |  |  |  | — |  |  |  | (0.4 | ) |  |  | Other expense, net
Net settlement related to early termination of forward contracts |  |  | — |  |  |  | — |  |  |  |  | — |  |  |  | 0.3 |  |  |  | Other expense, net
Total loss recognized in our Statements of Consolidated (Loss) Income related to fair value hedges |  | $ | — |  |  | $ | — |  |  |  | $ | — |  |  | $ | 0.3 |  |  |  |
(Gain) loss recognized in our Statements of Consolidated (Loss) Income related to non-designated hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Alloying Metals – Realized (gain) loss |  | $ | (1.2 | ) |  | $ | 0.3 |  |  |  | $ | (3.8 | ) |  | $ | 1.7 |  |  |  | Cost of products sold
Alloying Metals – Unrealized loss (gain) |  |  | 1.9 |  |  |  | (1.8 | ) |  |  |  | 2.0 |  |  |  | (1.8 | ) |  |  | Cost of products sold
Total loss (gain) recognized in our Statements of Consolidated (Loss) Income related to non-designated hedges |  | $ | 0.7 |  |  | $ | (1.5 | ) |  |  | $ | (1.8 | ) |  | $ | (0.1 | ) |  |  |
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 September 30, 2021 |  |  | As of December 31, 2020 |
|  | Assets |  |  | Liabilities |  |  | Net Amount |  |  | Assets |  |  | Liabilities |  |  | Net Amount |
Cash Flow Hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Aluminum – |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed price purchase contracts |  | $ | 23.9 |  |  | $ | (0.2 | ) |  | $ | 23.7 |  |  | $ | 4.6 |  |  | $ | (0.1 | ) |  | $ | 4.5 |
Fixed price sales contracts |  |  | — |  |  |  | (0.2 | ) |  |  | (0.2 | ) |  |  | — |  |  |  | — |  |  |  | — |
Midwest premium swap contracts |  |  | 7.1 |  |  |  | (0.1 | ) |  |  | 7.0 |  |  |  | 0.2 |  |  |  | (1.2 | ) |  |  | (1.0 | )
Natural gas – Fixed price purchase contracts |  |  | 5.8 |  |  |  | — |  |  |  | 5.8 |  |  |  | 0.2 |  |  |  | (1.5 | ) |  |  | (1.3 | )
Electricity – Fixed price purchase contracts |  |  | 9.4 |  |  |  | (0.2 | ) |  |  | 9.2 |  |  |  | 2.0 |  |  |  | (2.5 | ) |  |  | (0.5 | )
Total cash flow hedges |  |  | 46.2 |  |  |  | (0.7 | ) |  |  | 45.5 |  |  |  | 7.0 |  |  |  | (5.3 | ) |  |  | 1.7 |
Non-Designated Hedges: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Alloying Metals – |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed price purchase contracts |  |  | 2.0 |  |  |  | (0.5 | ) |  |  | 1.5 |  |  |  | 3.9 |  |  |  | — |  |  |  | 3.9 |
Fixed price sales contracts |  |  | — |  |  |  | (0.7 | ) |  |  | (0.7 | ) |  |  | — |  |  |  | (1.3 | ) |  |  | (1.3 | )
Total non-designated hedges |  |  | 2.0 |  |  |  | (1.2 | ) |  |  | 0.8 |  |  |  | 3.9 |  |  |  | (1.3 | ) |  |  | 2.6 |
Total |  | $ | 48.2 |  |  | $ | (1.9 | ) |  | $ | 46.3 |  |  | $ | 10.9 |  |  | $ | (6.6 | ) |  | $ | 4.3 |
The following table presents the total amounts of derivative assets and liabilities on our Consolidated Balance Sheets (in millions of dollars):
|  | As of September 30, 2021 |  |  | As of December 31, 2020 |
Derivative assets: |  |  |  |  |  |  |  |
Prepaid expenses and other current assets |  | $ | 41.3 |  |  | $ | 8.4 |
Other assets |  |  | 6.9 |  |  |  | 2.5 |
Total derivative assets |  | $ | 48.2 |  |  | $ | 10.9 |
Derivative liabilities: |  |  |  |  |  |  |  |
Other accrued liabilities |  | $ | (1.7 | ) |  | $ | (3.8 | )
Long-term liabilities |  |  | (0.2 | ) |  |  | (2.8 | )
Total derivative liabilities |  | $ | (1.9 | ) |  | $ | (6.6 | )

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