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Employee Benefits
 12 Months Ended
Dec. 31, 2021
Retirement Benefits [Abstract]  
Employee Benefits Employee Benefits
(a) Pension Plans.
U.S. Retirement Benefit Plan. We have two U.S. noncontributory defined benefit pension plans (“U.S. Pension Plans”). Our Polymer segment U.S. Pension Plans covers all salaried and hourly wage employees in the U.S. who were employed by us on or before December 31, 2005. Employees who began their employment with us after December 31, 2005 are not covered by our Pension Plans. The benefits under the Pension Plans are based primarily on years of service and employees’ pay near retirement. For our employees who were employed as of March 1, 2001 and who: (1) were previously employed by Shell Chemicals; and (2) elected to transfer their pension assets to us, we consider the total combined Shell Chemicals and Kraton service when calculating the employee’s pension benefit. For those employees who: (1) elected to retire from Shell Chemicals; or (2) elected not to transfer their pension benefit, only Kraton service (since March 1, 2001) is considered when calculating benefits. Our Chemical segment U.S. Pension Plans cover all U.S. employees hired prior to July 2004 and certain retirees of the Company participate in International Paper’s defined benefit pension plans. International Paper remains responsible for all benefits related to years of service prior to December 31, 2007. The Company implemented its own defined benefit pension plan for then eligible U.S. employees on March 1, 2007.
Based on the funded status and a related change in accrued pension obligations we reported a decrease in our accumulated other comprehensive income (loss) of approximately $13.4 million and an increase of $9.9 million as of December 31, 2021 and 2020, respectively.
Non-U.S. Retirement Benefit Plan. The Company sponsors defined benefit pension and retirement plans (“non-U.S. Pension Plans”) in certain foreign subsidiaries. Generally, the Company’s non-U.S. Pension Plans are funded using the projected benefit as a target in countries where funding of benefit plans is required.
Based on the funded status and a related change in accrued pension obligations we reported a decrease in our accumulated other comprehensive income (loss) of approximately $9.2 million and an increase $2.8 million as of December 31, 2021 and 2020, respectively.
The 2021 measurement date of the Pension Plan’s assets and obligations was December 31, 2021. Information concerning the pension obligation, plan assets, amounts recognized in our financial statements, and underlying actuarial and other assumptions are as follows:
U.S. PlansNon-U.S. Plans
 December 31,December 31,
 2021202020212020
 (In thousands)
Change in benefit obligation:    
Benefit obligation at beginning of period$215,618 $194,897 $112,764 $95,265 
Service cost— 187 1,984 1,861 
Interest cost5,588 6,621 1,247 1,656 
Participant contributions— — 267 242 
Benefits paid(8,614)(8,170)(5,524)(5,255)
Plan amendments — — — — 
Settlements — — (284)(1,018)
Other events— — — 9,183 
Actuarial (gain) loss(3,965)22,083 (4,230)5,326 
Exchange rate (gain) loss— — (3,318)5,504 
Benefit obligation at end of period208,627 215,618 102,906 112,764 
Change in plan assets:    
Fair value at beginning of period147,328 131,980 69,286 52,680 
Return on plan assets16,975 19,653 6,474 7,501 
Employer contributions10,250 3,865 5,598 5,502 
Participant contributions— — 267 242 
Benefits paid(8,614)(8,170)(5,524)(5,255)
Settlements — — (284)(1,018)
Other events— — — 6,952 
Exchange rate (gain) loss— — (1,293)2,682 
Fair value at end of period165,939 147,328 74,524 69,286 
Funded status at end of period$(42,688)$(68,290)$(28,382)$(43,478)
Amounts recognized on balance sheet:    
Current liabilities$— $— $(2,750)$(2,945)
Noncurrent liabilities(42,688)(68,290)(25,632)(40,533)
$(42,688)$(68,290)$(28,382)$(43,478)
Amounts recognized in accumulated other comprehensive loss:    
Prior service costs$— $— $2,347 $2,754 
Net actuarial loss54,983 68,407 12,353 21,112 
Amounts recognized in accumulated other comprehensive loss$54,983 $68,407 $14,700 $23,866 
Accumulated benefit obligations$208,627 $215,618 $96,349 $106,525 
Estimated Future Cash Flows. The following employer contributions and benefit payments, which reflect expected future service, as appropriate, are expected to be paid:
U.S. Plans Non-U.S. Plans
 (In thousands)
Employer Contributions
2022 Employer contributions$— $4,661 
Benefit Payments
2022$8,800 $5,576 
20239,074 4,728 
20249,339 5,041 
20259,643 5,969 
20269,897 6,830 
Years 2026-203053,665 31,959 
Total Benefit Payments$100,418 $60,103 
Net Periodic Pension Costs. Net periodic pension costs consist of the following components:
U.S. Plans Non-U.S. Plans
 Years Ended December 31,Years Ended December 31,
 202120202019202120202019
 (In thousands)
Service cost benefits earned during the period$— $187 $2,671 $1,984 $1,861 $1,491 
Interest on prior year’s projected benefit obligation5,588 6,621 7,781 1,247 1,656 2,112 
Expected return on plan assets(9,931)(9,106)(10,065)(3,427)(2,731)(2,520)
One-time settlement costs— — — 32 143 56 
Amortization of prior service costs— — — 236 17 34 
Amortization of net actuarial loss2,416 1,634 3,487 904 1,050 419 
Net periodic pension costs$(1,927)$(664)$3,874 $976 $1,996 $1,592 
Significant Assumptions. Discount rates are determined annually and are based on rates of return of high-quality long-term fixed income securities currently available and expected to be available during the maturity of the pension benefits.
U.S. PlansNon-U.S. Plans
 December 31,December 31,
 2021202020212020
Weighted average assumptions used to determine benefit obligations:    
Discount rate2.91 %2.66 %1.66 %1.13 %
Rates of increase in salary compensation levelN/A3.00 %3.03 %2.73 %
Expected long-term rate of return on plan assets7.00 %7.00 %4.96 %4.93 %
Weighted average assumptions used to determine net periodic benefit cost:    
Discount rate2.66 %3.45 %1.13 %1.79 %
Rates of increase in salary compensation levelN/A3.00 %2.73 %2.96 %
Expected long-term rate of return on plan assets7.00 %7.00 %4.93 %5.24 %
Our management relied in part on actuarial studies in establishing the expected long-term rate of return on assets assumption. The studies include a review of anticipated future long-term performance of individual asset classes and consideration of the appropriate asset allocation strategy given the anticipated requirements of the Pension Plans to determine the average rate of earnings expected on the funds invested to provide for the Pension Plans' benefits. While the studies give appropriate consideration to recent fund performance and historical returns, the assumption is primarily a long-term, prospective rate. Based on our most recent study, the expected long-term return assumption for our U.S. Pension Plans effective for 2022 will be 7.0% and 5.0% for our non-U.S. Pension Plans.
Based on the U.S. Pension Plan’s current target asset allocation, the median estimate for future asset returns (before non-investment expenses) was 7.5%. The asset return assumption set for determining the 2021 FASB ASC 715 expense was 7.0%, after non-investment expenses paid by the Trust. For the past three years, non-investment related expenses have averaged 0.5%. Therefore, the 7.0% return after non-investment expenses assumption is equivalent to a gross assumption of 7.5% (7.0% + 0.5%). An 7.5% rate (before non-investment expenses) falls within an acceptable range of simulated asset returns, between the 40th and 60th percentile.
Pension Plan Assets. We maintain target allocation percentages among various asset classes based on an investment policy established for our Pension Plans. The target allocation is designed to achieve long term objectives of return, while mitigating downside risk and considering expected cash flows. Our investment policy is reviewed from time to time to ensure consistency with our long term objectives. Our Pension Plan asset allocations at December 31, 2021 and 2020 by asset category are as follows:
U.S. PlansNon-U.S. Plans
Target AllocationPercentage of Plan
Assets
at December 31,		Target AllocationPercentage of Plan
Assets
at December 31,
202120212020202120212020
Equity 50.0 %72.2 %68.1 %45.0 %38.6 %36.2 %
Debt35.0 27.8 31.9 — 44.3 50.9 
Other15.0 — — 55.0 17.1 12.9 
Total100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %
No pension assets were invested in debt or equity securities of Kraton at December 31, 2021 or 2020.
The inputs and methodology used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a description of the primary valuation methodologies used for assets measured at fair value:
•Common/Collective Trust Funds: Valued at the net asset value per unit held at year end as quoted by the funds.
•Mutual Funds, Real Estate Funds, and Other Funds: Valued at the net asset value of shares held at year end as quoted in the active market.
•Insurance contracts for purposes of funding pension benefits.
A summary of total investments for our pension plan assets measured at fair value is presented below. See Note 9 Fair Value Measurements, Financial Instruments, and Credit Risk to the consolidated financial statements for a detailed description of fair value measurements and the hierarchy established for Level 1, 2, and 3 valuation inputs.
 Pension Plan Assets Fair Value Measurements at December 31, 2021
 TotalQuoted Prices
In Active Markets
Identical Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)(1)
Significant
Unobservable
Inputs
(Level 3)
 (In thousands)
Cash and Cash Equivalents$4,798 $1,545 $3,253 $— 
Equity $148,518 $77,509 $71,009 $— 
Debt79,136 9,386 69,750 — 
Other8,011 — — 8,011 
Total$240,463 $88,440 $144,012 $8,011 
___________________________________________
(1)Included are plan assets of $79.0 million, which are comprised of $42.3 million and $36.7 million in equity and debt, respectively, valued using the net asset value practical expedient measuring the fair value of investments in certain entities that calculate net asset value per share (or its equivalent).
 Pension Plan Assets Fair Value Measurements at December 31, 2020
 TotalQuoted Prices
In Active Markets
Identical Assets
(Level 1)
Significant
Observable
Inputs
(Level 2)(1)
Significant
Unobservable
Inputs
(Level 3)
 (In thousands)
Equity$125,359 $62,790 $62,569 $— 
Debt82,253 14,063 68,190 — 
Other9,002 984 — 8,018 
Total$216,614 $77,837 $130,759 $8,018 
___________________________________________
(1)Included are plan assets of $70.4 million, which are comprised of $37.5 million and $32.9 million in equity and debt, respectively, valued using the net asset value practical expedient measuring the fair value of investments in certain entities that calculate net asset value per share (or its equivalent).
(b) Other Retirement Benefit Plans. Certain employees were eligible to participate in non-qualified defined benefit restoration plans (“BRP”), which were intended to restore certain benefits under the Pension Plan in the U.S. and the Kraton Savings Plan in the U.S., that would otherwise be lost due to certain limitations imposed by law on tax-qualified plans.
(c) Postretirement Benefits Other Than Pensions. Health and welfare benefits are provided to benefit eligible employees in the U.S. who retire from Kraton and were employed by us prior to January 1, 2006. Retirees under the age of 65 are eligible for the same medical, dental, and vision plans as active employees, but with an annual cap on premiums that vary based on years of service and ranges from $7,000 to $10,000 per employee. Our subsidy schedule for medical plans is based on accredited service at retirement. Retirees are responsible for the full cost of premiums for postretirement dental and vision coverage. In general, the plans stipulate that health and welfare benefits are paid as covered expenses as incurred. We accrue the cost of these benefits during the period in which the employee renders the necessary service.
Employees who were retirement eligible as of February 28, 2001, have the option to participate in either Shell Chemicals' or Kraton's postretirement health and welfare plans.
ASC 715, “Compensation-Retirement Benefits,” requires that we measure the plans’ assets and obligations that determine our funded status at the end of each fiscal year. The 2021 measurement date of the plans’ assets and obligations was December 31, 2021. We are also required to recognize as a component of accumulated other comprehensive income (loss) the changes in funded status that occurred during the year that are not recognized as part of new periodic benefit cost.
Based on the funded status of our postretirement benefit plan as of December 31, 2021 and 2020, we reported an increase in our accumulated other comprehensive income (loss) of approximately $0.1 million and an increase of $2.9 million, respectively, and a related change in accrued pension obligations.
Information concerning the plan obligation, the funded status and amounts recognized in our financial statements and underlying actuarial and other assumptions are as follows:
 December 31,
 20212020
 (In thousands)
Change in benefit obligation:  
Benefit obligation at beginning of period$26,169 $23,979 
Service cost338 291 
Interest cost648 789 
Benefits and expenses paid (premiums)(1,230)(921)
Actuarial (gain) loss(658)2,031 
Plan amendments— — 
Benefit obligation at end of period25,267 26,169 
Change in plan assets (1):
  
Fair value at beginning of period— — 
Employer contributions1,230 921 
Benefits paid(1,230)(921)
Fair value at end of period— — 
Funded status at end of year$(25,267)$(26,169)
___________________________________________
(1)Shell Chemicals has committed to a future cash payment related to retiree medical expenses based on a specified dollar amount per employee, if certain contractual commitments are met. We have recorded an asset of approximately $3.0 million and $4.4 million as our estimate of the present value of this commitment as of December 31, 2021 and 2020, respectively.
 December 31,
 20212020
 (In thousands)
Amounts recognized in the balance sheet:  
Current liabilities$(1,537)$(1,443)
Noncurrent liabilities(23,730)(24,726)
 $(25,267)$(26,169)
Amounts recognized in accumulated other comprehensive loss:  
Prior service cost$(5,760)$(7,507)
Net actuarial loss$9,344 $10,977 
 $3,584 $3,470 
Estimated Future Cash Flows. The following employer contributions and benefit payments, which reflect expected future service, as appropriate, are expected to be paid:
Retiree Medical Plan
 (In thousands)
Employer Contributions
2022 Employer contributions$1,559 
Benefit Payments
2022$1,559 
20231,521 
20241,505 
20251,515 
20261,473 
Years 2026-20307,219 
Total Benefit Payments$14,792 
Net periodic benefit costs consist of the following components:
 Years Ended December 31,
 202120202019
 (In thousands)
Service cost$338 $291 $290 
Interest cost648 789 941 
Amortization of prior service cost(1,747)(1,747)(1,747)
Amortization of net actuarial loss975 887 621 
Net periodic benefit costs$214 $220 $105 
 December 31,
 20212020
Weighted average assumptions used to determine benefit obligations:  
Measurement date12/31/202112/31/2020
Discount rate2.86 %2.55 %
Rates of increase in salary compensation levelN/AN/A
Weighted average assumptions used to determine net periodic benefit cost:  
Discount rate2.55 %3.34 %
Rates of increase in salary compensation levelN/AN/A
Expected long-term rate of return on plan assetsN/AN/A
 December 31,
 20212020
Assumed Pre-65 health care cost trend rates:  
Health care cost trend rate assumed for next year6.50 %7.00 %
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)4.50 %4.50 %
Year that the rate reaches the ultimate trend rate20262026
 December 31,
 20212020
Assumed Post-65 health care cost trend rates:  
Health care cost trend rate assumed for next yearN/AN/A
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)N/AN/A
Year that the rate reaches the ultimate trend rateN/AN/A
Discount rates are determined annually and are based on rates of return of high-quality long-term fixed income securities currently available and expected to be available during the maturity of the postretirement benefit plan.
(d) Kraton Savings Plan. The Kraton Savings Plan, as adopted on March 1, 2001, covers substantially all U.S. employees, including executive officers. Through automatic payroll deduction, participants have the option to defer up to 60% of eligible earnings in any combination of pre-tax and/or post-tax contributions, subject to annual dollar limitations set forth in the Internal Revenue Code. Under this plan, we have two types of employer contributions:
(1) We make standard matching contributions of 50.0% of the first 6.0% contributed by the employee from start of employment and we make matching contributions of 100.0% of the first 6.0% contributed by the employee after completing five years of service.
(2) We make enhanced employer contributions of 4.0% for all employees.
For our employees who were employed as of February 28, 2001, and who were previously employed by Shell Chemicals, we recognize their Shell Chemicals years of service for purposes of determining employer contributions under our Plan. Our contributions to the plan for the years ended December 31, 2021, 2020, and 2019, were $11.0 million, $10.6 million, and $9.7 million, respectively.