We use derivatives to partially offset our exposure to foreign currency, interest rate, aluminum and other commodity price risk. We may enter into forward contracts, option contracts, swaps, collars or other derivative instruments to offset some of the risk on expected future cash flows and on certain existing assets and liabilities. However, we may choose not to hedge certain exposures for a variety of reasons including, but not limited to, accounting considerations and the prohibitive economic cost of hedging particular exposures. There can be no assurance the hedges will offset more than a portion of the financial impact resulting from movements in foreign currency exchange rates, interest rates, and aluminum or other commodity prices.

To help protect gross margins from fluctuations in foreign currency exchange rates, certain of our subsidiaries, whose functional currency is the U.S. dollar or the Euro, hedge a portion of their forecasted foreign currency costs denominated in the Mexican Peso and Polish Zloty, respectively. We may hedge portions of our forecasted foreign currency exposure up to 48 months.

We record all derivatives in the condensed consolidated balance sheets at fair value. Our accounting treatment for these instruments is based on the hedge designation. Gains or losses on derivatives that are designated as hedging instruments are recorded in accumulated other comprehensive income (loss) (“AOCI”) until the hedged item is recognized in earnings, at which point accumulated gains or losses will be recognized in earnings and classified with the underlying hedged transaction. Derivatives that are not designated as hedging instruments are adjusted to fair value through earnings in the financial statement line item to which the derivative relates. The Company has derivatives that are designated as hedging instruments as well as derivatives that do not qualify for designation as hedging instruments.

The following tables display the fair value of derivatives by balance sheet line item at September 30, 2020 and December 31, 2019:

	September 30, 2020
	Other Current Assets		Other Non-current Assets		Accrued Liabilities		Other Non-current Liabilities
(Dollars in thousands)
Foreign exchange forward contracts designated as hedging instruments	$	794	$	867	$	7,753	$	10,293
Foreign exchange forward contracts not designated as hedging instruments		7		—		466		—
Aluminum forward contracts designated as hedging instruments		—		—		123		—
Natural gas forward contracts designated as hedging instruments		837		511		142		39
Interest rate swap contracts designated as hedging instruments		—		—		4,872		5,296
Total derivative financial instruments	$	1,638	$	1,378	$	13,356	$	15,628

	December 31, 2019
	Other Current Assets		Other Non-current Assets		Accrued Liabilities		Other Non-current Liabilities
(Dollars in thousands)
Foreign exchange forward contracts designated as hedging instruments	$	7,808	$	12,821	$	60	$	100
Foreign exchange forward contracts not designated as hedging instruments		1,196		—		554		—
Aluminum forward contracts designated as hedging instruments		60		—		127		—
Natural gas forward contracts designated as hedging instruments		81		7		1,312		727
Interest rate swap contracts designated as hedging instruments		—		—		2,304		3,525
Total derivative financial instruments	$	9,145	$	12,828	$	4,357	$	4,352

The following table summarizes the notional amount and estimated fair value of our derivative financial instruments:

	September 30, 2020					December 31, 2019
	Notional U.S. Dollar Amount		Fair Value			Notional U.S. Dollar Amount		Fair Value
(Dollars in thousands)
Foreign currency forward contracts designated as hedging instruments	$	431,025	$	(16,385	)	$	449,181	$	20,469
Foreign exchange forward contracts not designated as hedging instruments		15,539		(459	)		73,491		642
Aluminum forward contracts designated as hedging instruments		4,971		(123	)		9,405		(67	)
Natural gas forward contracts designated as hedging instruments		6,254		1,167			5,816		(1,951	)
Interest rate swap contracts designated as hedging instruments		235,000		(10,168	)		260,000		(5,829	)
Total derivative financial instruments	$	692,789	$	(25,968	)	$	797,893	$	13,264

Notional amounts are presented on a net basis. The notional amounts of the derivative financial instruments do not represent amounts exchanged by the parties and, therefore, are not a direct measure of our exposure to the financial risks. The amounts exchanged are calculated by reference to the notional amounts and by other terms of the derivatives, such as interest rates, foreign currency exchange rates or commodity prices.

The following tables summarize the gain or loss recognized in AOCI as of September 30, 2020 and 2019, the amounts reclassified from AOCI into earnings and the amounts recognized directly into earnings for the three and nine months ended September 30, 2020 and 2019:

Three Months Ended September 30, 2020	Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income			Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
(Dollars in thousands)
Derivative Contracts	$	4,683		$	(2,261	)	$	3,458
Total	$	4,683		$	(2,261	)	$	3,458

Nine Months Ended September 30, 2020	Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income			Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
(Dollars in thousands)
Derivative Contracts	$	(25,316	)	$	(7,355	)	$	(289	)
Total	$	(25,316	)	$	(7,355	)	$	(289	)

Three Months Ended September 30, 2019	Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income		Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
(Dollars in thousands)
Derivative Contracts	$	(8,302	)	$	703	$	1,817
Total	$	(8,302	)	$	703	$	1,817

Nine Months Ended September 30, 2019	Amount of Gain or (Loss) Recognized in AOCI on Derivatives			Amount of Pre-tax Gain or (Loss) Reclassified from AOCI into Income		Amount of Pre-tax Gain or (Loss) Recognized in Income on Derivatives
(Dollars in thousands)
Derivative Contracts	$	(1,520	)	$	2,417	$	3,557
Total	$	(1,520	)	$	2,417	$	3,557