Derivatives and Other Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Schedule of Detail for Level 1 and 3 Derivatives

The following tables present the detail for Level 1 and 3 derivatives (see additional Level 3 information in further tables below):

	September 30, 2024				December 31, 2023
	Assets		Liabilities		Assets		Liabilities
Level 1 derivative instruments	$	5	$	6	$	16	$	9
Level 3 derivative instruments		1		1,268		16		1,297
Total	$	6	$	1,274	$	32	$	1,306
Less: Current		5		267		29		214
Noncurrent	$	1	$	1,007	$	3	$	1,092

	2024						2023
Third quarter ended September 30,	Unrealized gain (loss) recognized in Other comprehensive loss			Realized loss reclassed from Other comprehensive loss to earnings			Unrealized (loss) gain recognized in Other comprehensive loss			Realized gain (loss) reclassed from Other comprehensive loss to earnings
Level 1 derivative instruments	$	6		$	(1	)	$	(11	)	$	22
Level 3 derivative instruments		(149	)		(73	)		(110	)		(54	)
Noncontrolling and equity interest (Level 2)		—			—			1			3
Total	$	(143	)	$	(74	)	$	(120	)	$	(29	)

For the third quarter of 2024, the realized loss of $1 on Level 1 cash flow hedges was recognized in Sales. For the third quarter of 2023, the realized gain of $22 on Level 1 cash flow hedges was recognized in Sales.

	2024						2023
Nine months ended September 30,	Unrealized loss recognized in Other comprehensive loss			Realized gain (loss) reclassed from Other comprehensive loss to earnings			Unrealized gain (loss) recognized in Other comprehensive loss			Realized gain (loss) reclassed from Other comprehensive loss to earnings
Level 1 derivative instruments	$	(5	)	$	3		$	20		$	66
Level 3 derivative instruments		(174	)		(205	)		(87	)		(164	)
Noncontrolling and equity interest (Level 2)		—			1			1			5
Total	$	(179	)	$	(201	)	$	(66	)	$	(93	)

Schedule of Outstanding Quantities of Derivative Instruments

The following table presents the outstanding quantities of derivative instruments classified as Level 1:

	Classification	September 30, 2024		September 30, 2023
Aluminum (in kmt)	Commodity buy forwards		84		126
Aluminum (in kmt)	Commodity sell forwards		67		144
Foreign currency (in millions of euro)	Foreign exchange buy forwards		165		68
Foreign currency (in millions of euro)	Foreign exchange sell forwards		14		18
Foreign currency (in millions of Norwegian krone)	Foreign exchange buy forwards		66		185
Foreign currency (in millions of Brazilian real)	Foreign exchange buy forwards		246		734
Foreign currency (in millions of Canadian dollar)	Foreign exchange buy forwards		12		33
Foreign currency (in millions of Australian dollar)	Foreign exchange buy forwards		45		—

Schedule of Quantitative Information for Level 3 Derivative Contracts

The following table presents quantitative information related to the significant unobservable inputs described above for Level 3 derivative instruments (megawatt hours in MWh):

	September 30, 2024		Unobservable Input	Unobservable Input Range
Asset Derivatives
Financial contracts (undesignated)	$	1	Interrelationship of forward energy price, LME forward price, and the Consumer Price Index	Electricity (per MWh)	2024: $36.15 2025: $48.99
				LME (per mt)	2024: $2,620
					2025: $2,634
Total Asset Derivatives	$	1
Liability Derivatives
Power contract	$	175	MWh of energy needed to produce the forecasted mt of aluminum	LME (per mt)	2024: $2,620 2027: $2,748
				Electricity	Rate of 4 million MWh per year
Power contracts		1,089	MWh of energy needed to produce the forecasted mt of aluminum	LME (per mt)	2024: $2,620 2029: $2,795 2036: $2,995
				Midwest premium (per pound)	2024: $0.1930 2029: $0.2300 2036: $0.2300
				Electricity	Rate of 18 million MWh per year
Power contract		2	MWh of energy needed to produce the forecasted mt of aluminum	LME (per mt)	2024: $2,620 2024: $2,613
				Midwest premium (per pound)	2024: $0.1930 2024: $0.1975
				Electricity	Rate of 2 million MWh per year
Power contract (undesignated)		2	Estimated spread between the 30-year debt yield of Alcoa and the counterparty	Credit spread	1.61%: 30-year debt yield spread 6.59%: Alcoa (estimated) 4.98%: counterparty
Total Liability Derivatives	$	1,268

Schedule of Fair Values of Level 3 Derivative Instruments Recorded as Assets and Liabilities

The fair values of Level 3 derivative instruments recorded in the accompanying Consolidated Balance Sheet were as follows:

Asset Derivatives	September 30, 2024		December 31, 2023
Derivatives not designated as hedging instruments:
Current—financial contracts	$	1	$	16
Total derivatives not designated as hedging instruments	$	1	$	16
Total Asset Derivatives	$	1	$	16
Liability Derivatives
Derivatives designated as hedging instruments:
Current—power contracts	$	262	$	210
Noncurrent—power contracts		1,004		1,087
Total derivatives designated as hedging instruments	$	1,266	$	1,297
Derivatives not designated as hedging instruments:
Current—embedded credit derivative	$	1	$	—
Noncurrent—embedded credit derivative		1		—
Total derivatives not designated as hedging instruments	$	2	$	—
Total Liability Derivatives	$	1,268	$	1,297

Schedule of Reconciliation of Activity for Derivative Contracts

The following tables present the reconciliation of activity for Level 3 derivative instruments:

	Assets
Third quarter ended September 30, 2024	Financial contracts
July 1, 2024	$	34
Total gains or losses included in:
Other expenses, net (unrealized/realized)		(8	)
Settlements and other		(25	)
September 30, 2024	$	1
Change in unrealized gains or losses included in earnings    for derivative instruments held at September 30, 2024:
Other expenses, net	$	(8	)

	Liabilities
Third quarter ended September 30, 2024	Power contracts			Embedded credit derivative
July 1, 2024	$	1,190		$	1
Total gains or losses included in:
Sales (realized)		(73	)		—
Other expenses, net (unrealized/realized)		—			2
Other comprehensive income (unrealized)		149			—
Settlements and other		—			(1	)
September 30, 2024	$	1,266		$	2
Change in unrealized gains or losses included in earnings    for derivative instruments held at September 30, 2024:
Other expenses, net	$	—		$	2

	Assets
Nine months ended September 30, 2024	Financial contracts
January 1, 2024	$	16
Total gains or losses included in:
Other income, net (unrealized/realized)		42
Settlements and other		(57	)
September 30, 2024	$	1
Change in unrealized gains or losses included in earnings    for derivative instruments held at September 30, 2024:
Other income, net	$	42

	Liabilities
Nine months ended September 30, 2024	Power contracts			Embedded credit derivative
January 1, 2024	$	1,297		$	—
Total gains or losses included in:
Sales (realized)		(205	)		—
Other expenses, net (unrealized/realized)		—			3
Other comprehensive income (unrealized)		174			—
Settlements and other		—			(1	)
September 30, 2024	$	1,266		$	2
Change in unrealized gains or losses included in earnings    for derivative instruments held at September 30, 2024:
Other expenses, net	$	—		$	3

Schedule of Carrying Values and Fair Values of Other Financial Instruments

The carrying values and fair values of Alcoa Corporation’s other financial instruments were as follows:

	September 30, 2024				December 31, 2023
	Carrying value		Fair value		Carrying value		Fair value
Cash and cash equivalents	$	1,313	$	1,313	$	944	$	944
Restricted cash		97		97		103		103
Short-term borrowings		12		12		56		56
Long-term debt due within one year		464		464		79		79
Long-term debt, less amount due within one year		2,469		2,542		1,732		1,702