Pension Plans and Other Post Employment Benefit Plans

9 Months Ended

Sep. 30, 2020

Pension and Other Postretirement Benefits Disclosure [Text Block]

PENSION PLANS AND OTHER POST EMPLOYMENT BENEFITS

In connection with the Corteva Distribution, the company retained the benefit obligations relating to EID's principal U.S. pension plan, several other U.S. and non-U.S. pension plans and other post employment benefit plans ("OPEB"). Corteva entered into an employee matters agreement with DuPont which provides that employees of DuPont no longer participate in the benefits sponsored or maintained by the company as of the date of the Corteva Distribution and transferred certain EID's pension and OPEB obligations and associated assets to DuPont. As a result of the transfer, about $5.8 billion unfunded obligations of the pension and OPEB plans remained with Corteva, of which $319 million was supported by funding under the Trust agreement.

As a result of the Corteva Distribution, the company re-measured OPEB plans as of June 1, 2019. In connection with the re-measurement, the company updated the discount rate assumed at December 31, 2018 from 4.23% to 3.64%. The re-measurement resulted in an increase of $114 million to the company’s OPEB benefit obligations with a corresponding loss effect within other comprehensive income (loss) for the nine months ended September 30, 2019.

The following sets forth the components of the company's net periodic benefit (credit) cost for defined benefit pension plans and other post employment benefits:


	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions)	2020		2019		2020		2019
Defined Benefit Pension Plans:
Service cost	$	6	$	5	$	19	$	37
Interest cost	139		185		420		592
Expected return on plan assets	(250)		(253)		(750)		(839)
Amortization of unrecognized loss	1		—		3		2
Amortization of prior service benefit	—		—		(1)		—
Settlement/curtailment loss	—		1		3		—
Net periodic benefit credit - Total	$	(104)	$	(62)	$	(306)	$	(208)
Less: Discontinued operations1	—		—		—		(17)
Net periodic benefit credit - Continuing operations	$	(104)	$	(62)	$	(306)	$	(191)
Other Post Employment Benefits:
Service cost	$	—	$	—	$	1	$	3
Interest cost	16		20		49		65
Amortization of unrecognized loss (gain)	1		—		1		(1)

Net periodic benefit cost - Continuing operations	$	17	$	20	$	51	$	67

1. Includes non-service related components of net periodic benefit credit of $(37) million for the nine months ended September 30, 2019.