Derivatives And Other Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2011

Derivatives And Other Financial Instruments [Abstract]

Schedule Of Fair Values Of Outstanding Derivative Contracts Recorded As Assets

Asset Derivatives	December 31, 2011		December 31, 2010
Derivatives designated as hedging instruments:
Prepaid expenses and other current assets:
Aluminum contracts	$	56	$	48
Foreign exchange contracts		-		2
Interest rate contracts		8		19
Other noncurrent assets:
Aluminum contracts		6		22
Energy contracts		2		9
Interest rate contracts		37		62
Total derivatives designated as hedging instruments	$	109	$	162
Derivatives not designated as hedging instruments*:
Prepaid expenses and other current assets:
Aluminum contracts	$	1	$	3
Other noncurrent assets:
Aluminum contracts		5		-
Foreign exchange contracts		1		1
Total derivatives not designated as hedging instruments	$	7	$	4
Less margin held:
Prepaid expenses and other current assets:
Aluminum contracts	$	7	$	4
Interest rate contracts		8		13
Other noncurrent assets:
Interest rate contracts		7		2
Sub-total	$	22	$	19
Total Asset Derivatives	$	94	$	147

* See the "Other" section within Note X for additional information on Alcoa's purpose for entering into derivatives not designated as hedging instruments and its overall risk management strategies.

Schedule Of Fair Values Of Outstanding Derivative Contracts Recorded As Liabilities

Liability Derivatives	December 31, 2011		December 31, 2010
Derivatives designated as hedging instruments:
Other current liabilities:
Aluminum contracts	$	79	$	89
Other noncurrent liabilities and deferred credits:
Aluminum contracts		574		647
Total derivatives designated as hedging instruments	$	653	$	736
Derivatives not designated as hedging instruments*:
Other current liabilities:
Aluminum contracts	$	35	$	52
Energy contracts		-		62
Other noncurrent liabilities and deferred credits:
Aluminum contracts		22		33
Embedded credit derivative		28		23
Total derivatives not designated as hedging instruments	$	85	$	170
Less margin posted:
Other current liabilities:
Aluminum contracts	$	1	$	4
Energy contracts		-		37
Sub-total	$	1	$	41
Total Liability Derivatives	$	737	$	865

* See the "Other" section within Note X for additional information on Alcoa's purpose for entering into derivatives not designated as hedging instruments and its overall risk management strategies.

Schedule Of Net Fair Values Of Outstanding Derivative Contracts And Effect Of Hypothetical Change (Increase Or Decrease Of 10%) In Market Prices Or Rates

	Fair value asset/(liability)			Index change of + / - 10%
Aluminum contracts	$	(648	)	$	137
Embedded credit derivative		(28	)		9
Energy contracts		2			375
Foreign exchange contracts		1			-
Interest rate contracts		30			2

Schedule Of Derivative Contract Assets And Liabilities That Are Measured And Recognized At Fair Value On A Recurring Basis

December 31,	2011			2010
Assets:
Level 1	$	57		$	76
Level 2		47			81
Level 3		12			9
Margin held*		(22	)		(19	)
Total	$	94		$	147
Liabilities:
Level 1	$	64		$	35
Level 2		44			83
Level 3		630			788
Margin posted*		(1	)		(41	)
Total	$	737		$	865

* Margin held represents cash collateral received related to aluminum contracts included in Level 1 and interest rate contracts included in Level 2 and margin posted represents cash collateral paid related to aluminum contracts included in Level 1. At December 31, 2010, margin posted also represents cash collateral paid related to energy contracts included in Level 3. Alcoa elected to net the margin held and posted against the fair value amounts recognized for derivative instruments executed with the same counterparties under master netting arrangements.

Schedule Of Reconciliation Of Activity For Derivative Contracts On A Net Basis

	2011			2010
Balance at beginning of year	$	779		$	831
Total gains or losses (realized and unrealized) included in:
Sales—(decrease)		(63	)		(38	)
Cost of goods sold—(increase)		(15	)		(20	)
Other (income) expenses, net—(increase) decrease		(43	)		25
Other comprehensive (loss) income—(increase)		(35	)		(19	)
Purchases, sales, issuances, and settlements*		(5	)		-
Transfers into and (or) out of Level 3**		-			-
Balance at end of year	$	618		$	779
Total gains or losses included in earnings attributable to the change in unrealized gains or losses relating to derivative contracts still held at December 31, 2011 and 2010:
Sales	$	-		$	-
Cost of goods sold		-			-
Other (income) expenses, net—(increase) decrease		(5	)		22

* In 2011, there was an issuance of a Level 3 financial instrument related to a natural gas supply contract (see below). There were no purchases, sales, or settlements of Level 3 financial instruments in 2011 and 2010.

** In 2011 and 2010, there were no transfers of financial instruments into or out of Level 3.

Schedule Of Gain Or Loss On Hedged Items And Derivative Contracts

Derivatives in Fair Value Hedging Relationships	Location of Gain or (Loss) Recognized in Earnings on  Derivatives		Amount of Gain or (Loss) Recognized in Earnings on Derivatives
			2011			2010			2009
Aluminum contracts		Sales	$	(126	)	$	38		$	214
Interest rate contracts		Interest expense		64			90			61
Total			$	(62	)	$	128		$	275
Hedged Items in Fair Value Hedging Relationships	Location of Gain or (Loss) Recognized in Earnings on Hedged Items		Amount of Gain or (Loss) Recognized in Earnings on Hedged Items
			2011			2010			2009
Aluminum contracts		Sales	$	133		$	(41	)	$	(227	)
Interest rate contracts		Interest expense		(31	)		(62	)		(61	)
Total			$	102		$	(103	)	$	(288	)

Schedule Of Gains And Losses On Derivative Representing Either Hedge Ineffectiveness Or Hedge Components Excluded From Assessment Of Effectiveness Are Recognized In Current Earnings

Derivatives in Cash Flow Hedging Relationships	Amount of Gain or (Loss) Recognized in OCI on Derivatives (Effective Portion)									Location of Gain or (Loss) Reclassified from Accumulated OCI into Earnings (Effective Portion)	Amount of Gain or (Loss) Reclassified from Accumulated OCI into Earnings (Effective Portion)*									Location of Gain or (Loss) Recognized in Earnings on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing)	Amount of Gain or (Loss) Recognized in Earnings on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing)**
	2011			2010			2009				2011			2010			2009				2011		2010		2009
Aluminum contracts	$	72		$	(6	)	$	(589	)	Sales	$	(114	)	$	(106	)	$	(4	)	Other (income) expenses, net	$	2	$	-	$	3
Aluminum contracts		-			-			13		Other (income) expenses, net		-			-			49		Other (income) expenses, net		-		-		-
Energy contracts		(3	)		(10	)		(29	)	Cost of goods sold		(8	)		(25	)		(37	)	Other (income) expenses, net		-		-		-
Foreign exchange contracts		1			(3	)		(2	)	Sales		4			(6	)		3		Other (income) expenses, net		-		-		-
Interest rate contracts		(2	)		(1	)		-		Interest expense		-			(1	)		-		Other (income) expenses, net		-		-		-
Interest rate contracts		(5	)		(1	)		(2	)	Other (income) expenses, net		(3	)		-			-		Other (income) expenses, net		-		-		-
Total	$	63		$	(21	)	$	(609	)		$	(121	)	$	(138	)	$	11			$	2	$	-	$	3

* Assuming market rates remain constant with the rates at December 31, 2011, a gain of $22 is expected to be recognized in earnings over the next 12 months.

** In 2011, 2010, and 2009, the amount of gain or (loss) recognized in earnings represents $(1), less than $1, and $3, respectively, related to the ineffective portion of the hedging relationships. There was also $3 recognized in earnings related to the amount excluded from the assessment of hedge effectiveness in 2011.

Schedule Of Outstanding Forward Contracts That Were Entered Into Hedge Forcasted Transactions

December 31,	2011		2010
Aluminum contracts (kmt)		1,294		1,285
Energy contracts (electricity—megawatt hours)		100,578,295		100,578,295
Foreign exchange contracts	$	-	$	20

Schedule Of Fair Value Gains And Losses On Derivatives Contracts Recorded In Earnings

Derivatives Not Designated as Hedging Instruments	Location of Gain or (Loss) Recognized in Earnings on  Derivatives	Amount of Gain or (Loss) Recognized in Earnings on Derivatives
		2011			2010			2009
Aluminum contracts	Sales	$	(13	)	$	5		$	(9	)
Aluminum contracts	Other (income) expenses, net		13			(18	)		(38	)
Embedded credit derivative	Other (income) expenses, net		(5	)		(2	)		-
Energy contract	Other (income) expenses, net		47			(23	)		(30	)
Foreign exchange contracts	Other (income) expenses, net		(3	)		6			6
Total		$	39		$	(32	)	$	(71	)

Schedule Of Carrying Values And Fair Values Of Other Financial Instruments

December 31,	2011				2010
	Carrying value		Fair value		Carrying value		Fair value
Cash and cash equivalents	$	1,939	$	1,939	$	1,543	$	1,543
Restricted cash		25		25		1		1
Noncurrent receivables		30		30		23		23
Available-for-sale securities		92		92		93		93
Short-term borrowings		62		62		92		92
Commercial paper		224		224		-		-
Long-term debt due within one year		445		445		231		231
Long-term debt, less amount due within one year		8,640		9,274		8,842		9,882