DERIVATIVE INSTRUMENTS

The Company enters into New York Mercantile Exchange NY Harbor ULSD ("NY Harbor ULSD" or previously referred to as heating oil) and CBOT Soybean Oil (previously referred to as soybean oil) futures, swaps and options ("commodity contract derivatives") to reduce the risk of price volatility related to anticipated purchases of feedstock raw materials and to protect cash margins from potentially adverse effects of price volatility on biomass-based diesel sales where prices are set at a future date. All of the Company’s commodity contract derivatives are designated as non-hedge derivatives and recorded at fair value on the Condensed Consolidated Balance Sheets. Unrealized gains and losses are recognized as a component of biomass-based diesel costs of goods sold reflected in current results of operations. As of June 30, 2018, the net notional volumes of NY Harbor ULSD and CBOT Soybean Oil covered under the open commodity derivative contracts were approximately 100 million gallons and 202 million pounds, respectively.

The Company offsets the fair value amounts recognized for its commodity contract derivatives with cash collateral with the same counterparty under a master netting agreement. The net position is presented within prepaid and other assets in the Condensed Consolidated Balance Sheets. The following table sets forth the fair value of the Company's commodity contract derivatives and amounts that offset within the Condensed Consolidated Balance Sheets:



	June 30, 2018						December 31, 2017
	Assets			Liabilities			Assets			Liabilities
Gross amounts of derivatives recognized at fair value	$	4,664		$	3,162		$	812		$	8,001
Cash collateral	3,172			—			8,799			—
Total gross amount recognized	7,836			3,162			9,611			8,001
Gross amounts offset	(3,162		)	(3,162		)	(8,001		)	(8,001		)
Net amount reported in the condensed consolidated balance sheets	$	4,674		$	—		$	1,610		$	—

The following table sets forth the commodity contract derivatives gains and (losses) included in the Condensed Consolidated Statements of Operations:



	Location of Gain (Loss) Recognized in income	Three Months Ended June 30, 2018			Three Months Ended June 30, 2017		Six Months Ended June 30, 2018			Six Months Ended June 30, 2017
Commodity derivatives	Cost of goods sold – Biomass-based diesel	$	(12,909	)	$	9,758	$	(15,347	)	$	18,047