Cash and cash equivalents, short-term notes and accounts receivable, accounts payable and other current payables – The carrying amount approximates fair value because of the short maturity of these instruments.

Debt – The fair value of our debt as of December 31, 2019 and December 31, 2018 approximated book value of $1,812.8 million and $2,156.6 million, respectively. The fair values were determined using Level 3 inputs.

Foreign currency derivatives – Foreign currency derivatives are carried at market value using Level 2 inputs. We had an outstanding gain of $0.2 million as of December 31, 2019 and an outstanding loss of $0.1 million as of December 31, 2018.

Commodity derivative contracts – Commodity derivative contracts are carried at fair value. We determine the fair value using observable, quoted refined oil product prices that are determined by active markets and therefore classify the commodity derivative contracts as Level 2. We had outstanding gains of $0.5 million and outstanding losses of $4.1 million as of December 31, 2019 and outstanding gains of $0.3 million and outstanding losses of $11.0 million as of December 31, 2018.

Interest rate swap contracts – Interest rate swap contracts are carried at fair value. We determine the fair value using the income approach to value the derivatives, using observable Level 2 market expectations at the measurement date and standard valuation techniques to convert future amounts to a single discounted present amount reflecting current market expectations about those future amounts. We had outstanding unrealized gains of $2.9 million and outstanding unrealized losses of $0.1 million as of December 31, 2019.

We use derivative instruments as part of our overall foreign currency and commodity risk management strategies to manage the risk of exchange rate movements that would reduce the value of our foreign cash flows and to minimize commodity price volatility. Foreign currency exchange rate movements create a degree of risk by affecting the value of sales made and costs incurred in currencies other than the U.S. dollar.

Certain of our derivative contracts contain provisions that require us to provide collateral. Since the counterparties to these financial instruments are large commercial banks and similar financial institutions, we do not believe that we are exposed to material counterparty credit risk. We do not anticipate nonperformance by any of the counter-parties to our instruments.

We enter into foreign currency derivatives from time to time to attempt to manage exposure to changes in currency exchange rates. These foreign currency instruments, which include, but are not limited to, forward exchange contracts and purchased currency options, attempt to hedge global currency exposures such as foreign currency denominated debt, sales, receivables, payables, and purchases.

We had no foreign currency cash flow hedges outstanding as of December 31, 2019 and December 31, 2018 and therefore, no unrealized gains or losses reported under accumulated other comprehensive income (loss).

As of December 31, 2019, we had outstanding Mexican peso, South African rand, euro, Swiss franc and Japanese yen currency contracts, with aggregate notional amounts of $78.8 million. As of December 31, 2018, we had outstanding Mexican peso, South African rand, euro, Swiss franc and Japanese yen currency contracts, with aggregate notional amounts of $19.6 million. The foreign currency derivatives outstanding as of December 31, 2019 had maturity dates from January 2020 to March 2020, and were not designated as hedging instruments.

We have entered into commodity derivative contracts for refined oil products. These contracts are entered into to protect against the risk that eventual cash flows related to these products will be adversely affected by future changes in prices. In the fourth quarter of 2017, we began to enter into three- to five-year take-or-pay contracts with many of our customers and began to hedge the cash flows related to these contracts. As of December 31, 2019, we had outstanding commodity derivative contracts with a notional amount of $99.5 million and maturities from January 2020 to June 2022. As of December 31, 2018, we had outstanding commodity derivative contracts with a notional amount of $142.1 million with maturities from January 2019 to June 2022. Within Accumulated Other Comprehensive income (loss), we had a net unrealized pre-tax loss of $3.7 million and a net unrealized pre-tax loss of $10.7 million as of December 31, 2019 and 2018, respectively. The fair value of these contracts was determined using Level 2 inputs.

In the fourth quarter of 2019, we released $0.4 million from accumulated other comprehensive income to cost of sales. This resulted from a portion of our commodity derivative contracts failing to qualify for hedge accounting.

During the third quarter of 2019, the Company entered into interest rate swap contracts. The contracts are "pay fixed, receive variable" with notional amounts of $500 million maturing in two years and another $500 million maturing in five years. The Company’s risk management objective was to fix its cash flows associated with the risk in variability in the one-month US LIBO Rate for a portion of our outstanding debt. It is expected that these swaps will fix the cash flows associated with the forecasted interest payments on this notional amount of debt to an effective fixed interest rate of 5.1%, which could be lowered to 4.85% depending on credit ratings. Within accumulated other comprehensive income we recorded a net unrealized pre-tax gain of $2.9 million as of December 31, 2019. The fair value of these contracts was determined using Level 2 inputs.

We use certain intercompany debt to hedge a portion of our net investment in our foreign operations against currency exposure (net investment hedge). Intercompany debt designated in foreign currency and designated as a non-derivative net investment hedging instrument was $5.5 million and $9.5 million as of December 31, 2019 and 2018, respectively. Within our currency translation adjustment portion of other comprehensive income (loss), we recorded no gain or loss in 2019, and a gain of $2.2 million in 2018, resulting from these net investment hedges.

The fair value of all derivatives is recorded as assets or liabilities on a gross basis in our Consolidated Balance Sheets. At December 31, 2019 and 2018, the fair value of our derivatives and their respective balance sheet locations are presented in the following table:



	Asset Derivatives			Liability Derivatives
	Location	Fair Value		Location	Fair Value
As of December 31, 2019	(Dollars in thousands)
Derivatives designated as cash flow hedges:
Commodity derivative contracts	Prepaid and other current assets	$	104	Other accrued liabilities	$	1,872
	Other long-term assets	369		Other long-term obligations	2,255
Interest rate swap contracts	Prepaid and other current assets	253		Other accrued liabilities	—
	Other long-term assets	2,684		Other long-term obligations	72
Total fair value		$	3,410		$	4,199

As of December 31, 2018
Commodity derivative contracts	Prepaid and other current assets	$	90	Other accrued liabilities	$	4,630
	Other long-term assets	260		Other long-term obligations	6,393
Total fair value		$	350		$	11,023



	Asset Derivatives			Liability Derivatives
	Location	Fair Value		Location	Fair Value
As of December 31, 2019	(Dollars in Thousands)
Derivatives not designated as hedges:
Foreign currency derivatives	Prepaid and other current assets	$	239	Other current liabilities	$	81
Commodity derivative contracts	Prepaid and other current assets	376		Other accrued liabilities	—
Total fair value		$	615		$	81

As of December 31, 2018
Derivatives not designated as hedges:
Foreign currency derivatives	Prepaid and other current assets	$	—	Other current liabilities	$	43

As a result of the settlement of commodity derivative contracts, as of December 31, 2019 and December 31, 2018, net realized pre-tax gains of $3.5 million and $7.0 million, respectively, were reported in accumulated other comprehensive income (loss) and will be released to earnings within the next 12 months.

The location and amount of realized (gains) losses on derivatives are recognized in the Statements of Operations when the hedged item impacts earnings and are as follows for the years ended December 31, 2019, 2018 and 2017:



		Amount of (Gain)/Loss Recognized
	Location of (Gain)/Loss Recognized in the Consolidated Statement of Operations	2019			2018			2017
Derivatives designated as cash flow hedges:		(Dollars in thousands)
Commodity derivative contracts	Cost of sales	$	(8,892	)	$	(919	)	$	—
Interest rate swaps	Interest expense	(1,050		)	—			—



		Amount of (Gain)/Loss Recognized
	Location of (Gain)/Loss Recognized in the Consolidated Statement of Operations	2019			2018			2017
Derivatives not designated as hedges:		(Dollars in thousands)
Foreign currency derivatives	Cost of sales, Other expense/(income)	$	(506	)	$	(522	)	$	(1,565	)
Commodity derivative contracts	Cost of sales	(223		)	—			—