Financial Instruments (Tables)

9 Months Ended

Jun. 30, 2012

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The following table provides the fair value and Consolidated Balance Sheet presentations of derivative instruments by each derivative type, without regard to the legal right to offset derivative settlement by each counterparty.

	Consolidated Balance Sheet Caption	June 30, 2012		September 30, 2011
		(Dollars in millions)
Fair Value of Derivative Instruments
Asset Derivatives
Derivatives designated as hedges
Interest rate(1)	Prepaid expenses and other current assets and Other liabilities	$	2	$	3
Total derivatives designated as hedges		$	2	$	3
Derivatives not designated as hedges
Foreign currency	Prepaid expenses and other current assets	$	—	$	1
Commodity contracts(2)	Prepaid expenses and other current assets		1		1
Total derivatives not designated as hedges		$	1	$	2
Total Asset Derivatives		$	3	$	5
Liability Derivatives
Derivatives designated as hedges
Foreign currency	Accounts payable and accrued liabilities	$	—	$	1
Total derivatives designated as hedges			—		1
Derivatives not designated as hedges
Foreign currency(1)	Accounts payable and accrued liabilities and Other liabilities	$	21	$	41
Commodity contracts(2)	Prepaid expenses and other current assets		1		1
Total derivatives not designated as hedges		$	22	$	42
Total Liability Derivatives		$	22	$	43

⁽¹⁾  Contracts of $2 million and $3 million presented on a gross basis in this table at June 30, 2012 and September 30, 2011, respectively, have the legal right to offset against other types of contracts with a common counterparty and, therefore, are presented on a net basis in noncurrent “Other liabilities” in the Consolidated Balance Sheet.

⁽²⁾ Contracts in an asset and liability position presented on a gross basis in this table have the legal right of offset and, therefore, are presented on a net basis in “Prepaid expenses and other current assets” in the Consolidated Balance Sheet.

Interest Rate Risk Management

Schedule of Derivatives Fair Value Interest Rate

The following table provides details of the derivatives held as of June 30, 2012 and September 30, 2011 to manage interest rate risk.

		Notional Amount		Hedge  Designation
Description	Borrowing	June 30, 2012	September 30, 2011
Interest Rate Swap—Fixed to Variable	Eurobond (20% of $175 million)	USD 35 million	USD 35 million	Fair Value
Interest Rate Swap—Fixed to Variable	Medium Term Notes	USD 23 million	USD 23 million	Fair Value

Foreign Currency Risk Management

Schedule of Derivatives Held in as Foreign Currency Risk

The following table provides details of the derivatives held as of June 30, 2012 and September 30, 2011 to manage foreign currency risk.

		Notional Amount
Description	Borrowing	June 30, 2012	September 30, 2011	Hedge Designation
Cross Currency Swap	Eurobond (80% of $175 million)	USD 140 million swapped to EUR 124 million	USD 140 million swapped to EUR 124 million		No designation
Cross Currency Swap	Eurobond (20% of $175 million)	USD 35 million swapped to EUR 31 million	USD 35 million swapped to EUR 31 million		No designation
Forward Foreign Currency Contracts (1)	N/A	USD 76 million	USD 54 million		No designation
Forward Foreign Currency Contracts (2)	N/A	USD 7 million	USD 12 million		Cash Flow

⁽¹⁾  Cabot’s forward foreign exchange contracts are denominated primarily in the Australian dollar, British pound sterling, Canadian dollar, Chinese renminbi, Euro, and Japanese yen.

⁽²⁾  Cabot’s forward foreign exchange contracts designated as cash flow hedges are denominated in Japanese yen and are presented in their USD equivalent in the table above.

Commodity Risk Management

Schedule of Derivatives Fair Value Interest Rate

The following table provides details of the derivatives held as of June 30, 2012 and September 30, 2011 to manage commodity risk.

Description	Net Buyer / Net Seller		Notional Amount				Hedge Designation
			June 30, 2012		September 30, 2011
CERs		Buyer		EUR 1 million		EUR 1 million		No designation
EUAs		Seller		EUR 1 million		EUR 1 million		No designation