DERIVATIVES

The Company occasionally enters into lumber derivative contracts in order to protect its gross profit margins from fluctuations caused by volatility in lumber prices. At December 31, 2017, the Company had a net long (buying) position of 330,000 board feet under three lumber derivatives contracts with a fair value of $5.2 thousand which is included in other current assets. In addition, at December 31, 2017, the Company has a long position of 1,100,000 board feet under ten different lumber derivative call contracts and has a short position of 1,100,000 board feet under ten different lumber derivative put contracts, with a net fair value of $3.9 thousand which is also included in other current assets. At December 31, 2016, the Company had no lumber derivative contracts outstanding. The Company had restricted cash on deposit with the broker totaling $52.3 thousand at December 31, 2017.

Gains (losses) from derivative instruments, none of which are designated as hedging instruments, are recorded in cost of goods sold in the Company’s statements of operations and included the following (in thousands):



	December 31, 2017
Realized gains, net	$	37
Unrealized gains, net	6
Total	$	43