Derivative Instruments and Hedging Activities Derivative Instruments and Hedging Activities (Tables)

6 Months Ended

Jan. 31, 2018

Fair Value of Financial Derivatives Balance Sheet Locations

The following tables provide a summary of the fair value of derivatives in Ferrellgas’ condensed consolidated balance sheets as of January 31, 2018 and July 31, 2017:  

	January 31, 2018
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	18,188	Other current liabilities	$	1,417
Commodity derivatives-propane	Other assets, net	7,537		Other liabilities	—
Interest rate swap agreements	Prepaid expenses and other current assets	—		Other current liabilities	319
Interest rate swap agreements	Other assets, net	—		Other liabilities	2,104
	Total	$	25,725	Total	$	3,840
	July 31, 2017
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	11,061	Other current liabilities	$	415
Commodity derivatives-propane	Other assets, net	4,413		Other liabilities	15
Interest rate swap agreements	Prepaid expenses and other current assets	583		Other current liabilities	595
Interest rate swap agreements	Other assets, net	—		Other liabilities	112
Derivatives not designated as hedging instruments
Commodity derivatives-crude oil	Prepaid expenses and other current assets	738		Other current liabilities	828
	Total	$	16,795	Total	$	1,965

Schedule of Derivative Collateral

The following tables provide a summary of cash margin balances as of January 31, 2018 and July 31, 2017, respectively:

	January 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expenses and other current assets	$	3,018	Other current liabilities	$	12,201
	Other assets, net	1,404		Other liabilities	5,216
		$	4,422		$	17,417

	July 31, 2017
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expenses and other current assets	$	1,778	Other current liabilities	$	7,729
	Other assets, net	1,631		Other liabilities	3,073
		$	3,409		$	10,802

Fair Value Hedge Derivative Effect on Earnings

The following tables provide a summary of the effect on Ferrellgas' condensed consolidated statements of operations for the three and six months endedJanuary 31, 2018 and 2017 due to derivatives designated as fair value hedging instruments:  

		Amount of Gain Recognized on Derivative				Amount of Interest Expense Recognized on Fixed-Rate Debt (Related Hedged Item)
Derivative Instrument	Location of Amounts Recognized on Derivative	For the three months ended January 31,				For the three months ended January 31,
		2018		2017		2018			2017
Interest rate swap agreements	Interest expense	$	88	$	328	$	(2,275	)	$	(2,275	)
		Amount of Gain Recognized on Derivative				Amount of Interest Expense Recognized on Fixed-Rate Debt (Related Hedged Item)
Derivative Instrument	Location of Amounts Recognized on Derivative	For the six months ended January 31,				For the six months ended January 31,
		2018		2017		2018			2017
Interest rate swap agreements	Interest expense	$	226	$	748	$	(4,550	)	$	(4,550	)

Cash Flow Hedge Derivative Effect on Comprehensive Income

The following tables provide a summary of the effect on Ferrellgas’ condensed consolidated statements of comprehensive income (loss) for the three and six months endedJanuary 31, 2018 and 2017 due to derivatives designated as cash flow hedging instruments:

	For the three months ended January 31, 2018
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income
				Effective portion			Ineffective portion
Commodity derivatives	$	960	Cost of sales-propane and other gas liquids sales	$	9,886		$	—
Interest rate swap agreements	112		Interest expense	(143		)	—
	$	1,072		$	9,743		$	—
	For the three months ended January 31, 2017
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income
				Effective portion			Ineffective portion
Commodity derivatives	$	14,699	Cost of sales-propane and other gas liquids sales	$	73		$	—
Interest rate swap agreements	563		Interest expense	(587		)	—
	$	15,262		$	(514	)	$	—
	For the six months ended January 31, 2018
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income
				Effective portion			Ineffective portion
Commodity derivatives	$	23,283	Cost of sales-propane and other gas liquids sales	$	14,018		$	—
Interest rate swap agreements	238		Interest expense	(326		)	—
	$	23,521		$	13,692		$	—
	For the six months ended January 31, 2017
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income
				Effective portion			Ineffective portion
Commodity derivatives	$	19,572	Cost of sales-propane and other gas liquids sales	$	(3,523	)	$	—
Interest rate swap agreements	828		Interest expense	(1,229		)	—
	$	20,400		$	(4,752	)	$	—

Derivatives not Designated as Hedging, Effect on Earnings

The following tables provide a summary of the effect on Ferrellgas' condensed consolidated statements of operations for the three and six months endedJanuary 31, 2018 and 2017 due to the change in fair value of derivatives not designated as hedging instruments:

	For the three months ended January 31, 2018
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Recognized in Income
Commodity derivatives - crude oil	$	(2,080	)	Cost of sales - midstream operations
	For the three months ended January 31, 2017
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Recognized in Income
Commodity derivatives - crude oil	$	(1,007	)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	489		Operating expense
	For the six months ended January 31, 2018
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Recognized in Income
Commodity derivatives - crude oil	$	(3,470	)	Cost of sales - midstream operations
	For the six months ended January 31, 2017
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Recognized in Income
Commodity derivatives - crude oil	$	(2,248	)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,516		Operating expense

Changes in Derivative Value Effect on Other Comprehensive Income (Loss)

The changes in derivatives included in AOCI for the six months endedJanuary 31, 2018 and 2017 were as follows:  

	For the six months ended January 31,
Gains and losses on derivatives included in AOCI	2018			2017
Beginning balance	$	14,648		$	(9,815	)
Change in value of risk management commodity derivatives	23,283			19,572
Reclassification of (gains) and losses on commodity hedges to cost of sales - propane and other gas liquids sales, net	(14,018		)	3,523
Change in value of risk management interest rate derivatives	238			828
Reclassification of losses on interest rate hedges to interest expense	326			1,229
Ending balance	$	24,477		$	15,337

Ferrellgas, L.P. [Member]

Fair Value of Financial Derivatives Balance Sheet Locations

The following tables provide a summary of the fair value of derivatives in Ferrellgas, L.P.’s condensed consolidated balance sheets as of January 31, 2018 and July 31, 2017: 

	January 31, 2018
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	18,188	Other current liabilities	$	1,417
Commodity derivatives-propane	Other assets, net	7,537		Other liabilities	—
Interest rate swap agreements	Prepaid expenses and other current assets	—		Other current liabilities	319
Interest rate swap agreements	Other assets, net	—		Other liabilities	2,104
	Total	$	25,725	Total	$	3,840
	July 31, 2017
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Location	Fair value		Location	Fair value
Derivatives designated as hedging instruments
Commodity derivatives-propane	Prepaid expenses and other current assets	$	11,061	Other current liabilities	$	415
Commodity derivatives-propane	Other assets, net	4,413		Other liabilities	15
Interest rate swap agreements	Prepaid expenses and other current assets	583		Other current liabilities	595
Interest rate swap agreements	Other assets, net	—		Other liabilities	112
Derivatives not designated as hedging instruments
Commodity derivatives-crude oil	Prepaid expenses and other current assets	738		Other current liabilities	828
	Total	$	16,795	Total	$	1,965

Schedule of Derivative Collateral

The following tables provide a summary of cash margin balances as of January 31, 2018 and July 31, 2017, respectively:

	January 31, 2018
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expenses and other current assets	$	3,018	Other current liabilities	$	12,201
	Other assets, net	1,404		Other liabilities	5,216
		$	4,422		$	17,417

	July 31, 2017
	Assets			Liabilities
Description	Location	Amount		Location	Amount
Margin Balances	Prepaid expenses and other current assets	$	1,778	Other current liabilities	$	7,729
	Other assets, net	1,631		Other liabilities	3,073
		$	3,409		$	10,802

Fair Value Hedge Derivative Effect on Earnings

The following tables provides a summary of the effect on Ferrellgas, L.P.’s condensed consolidated statements of operations for the three and six months endedJanuary 31, 2018 and 2017 due to derivatives designated as fair value hedging instruments:

		Amount of Gain Recognized on Derivative				Amount of Interest Expense Recognized on Fixed-Rate Debt (Related Hedged Item)
Derivative Instrument	Location of Amounts Recognized on Derivative	For the three months ended January 31,				For the three months ended January 31,
		2018		2017		2018			2017
Interest rate swap agreements	Interest expense	$	88	$	328	$	(2,275	)	$	(2,275	)
		Amount of Gain Recognized on Derivative				Amount of Interest Expense Recognized on Fixed-Rate Debt (Related Hedged Item)
Derivative Instrument	Location of Amounts Recognized on Derivative	For the six months ended January 31,				For the six months ended January 31,
		2018		2017		2018			2017
Interest rate swap agreements	Interest expense	$	226	$	748	$	(4,550	)	$	(4,550	)

Cash Flow Hedge Derivative Effect on Comprehensive Income

The following tables provide a summary of the effect on Ferrellgas, L.P.’s condensed consolidated statements of comprehensive income (loss) for the three and six months endedJanuary 31, 2018 and 2017 due to derivatives designated as cash flow hedging instruments:  

	For the three months ended January 31, 2018
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income
				Effective portion			Ineffective portion
Commodity derivatives	$	960	Cost of sales-propane and other gas liquids sales	$	9,886		$	—
Interest rate swap agreements	112		Interest expense	(143		)	—
	$	1,072		$	9,743		$	—
	For the three months ended January 31, 2017
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income
				Effective portion			Ineffective portion
Commodity derivatives	$	14,699	Cost of sales-propane and other gas liquids sales	$	73		$	—
Interest rate swap agreements	563		Interest expense	(587		)	—
	$	15,262		$	(514	)	$	—
	For the six months ended January 31, 2018
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income
				Effective portion			Ineffective portion
Commodity derivatives	$	23,283	Cost of sales-propane and other gas liquids sales	$	14,018		$	—
Interest rate swap agreements	238		Interest expense	(326		)	—
	$	23,521		$	13,692		$	—
	For the six months ended January 31, 2017
Derivative Instrument	Amount of Gain (Loss) Recognized in AOCI		Location of Gain (Loss) Reclassified from AOCI into Income	Amount of Gain (Loss) Reclassified from AOCI into Income
				Effective portion			Ineffective portion
Commodity derivatives	$	19,572	Cost of sales-propane and other gas liquids sales	$	(3,523	)	$	—
Interest rate swap agreements	828		Interest expense	(1,229		)	—
	$	20,400		$	(4,752	)	$	—

Derivatives not Designated as Hedging, Effect on Earnings

The following tables provide a summary of the effect on Ferrellgas, L.P.'s condensed consolidated statements of operations for the three and six months endedJanuary 31, 2018 and 2017 due to the change in fair value of derivatives not designated as hedging instruments:

	For the three months ended January 31, 2018
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Recognized in Income
Commodity derivatives - crude oil	$	(2,080	)	Cost of sales - midstream operations
	For the three months ended January 31, 2017
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Recognized in Income
Commodity derivatives - crude oil	$	(1,007	)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	489		Operating expense
	For the six months ended January 31, 2018
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Recognized in Income
Commodity derivatives - crude oil	$	(3,470	)	Cost of sales - midstream operations
	For the six months ended January 31, 2017
Derivatives Not Designated as Hedging Instruments	Amount of Gain (Loss) Recognized in Income			Location of Gain (Loss) Recognized in Income
Commodity derivatives - crude oil	$	(2,248	)	Cost of sales - midstream operations
Commodity derivatives - vehicle fuel	$	1,516		Operating expense

Changes in Derivative Value Effect on Other Comprehensive Income (Loss)

The changes in derivatives included in AOCI for the six months endedJanuary 31, 2018 and 2017 were as follows: 

	For the six months ended January 31,
Gains and losses on derivatives included in AOCI	2018			2017
Beginning balance	$	14,648		$	(9,815	)
Change in value of risk management commodity derivatives	23,283			19,572
Reclassification of (gains) and losses on commodity hedges to cost of sales - propane and other gas liquids sales, net	(14,018		)	3,523
Change in value of risk management interest rate derivatives	238			828
Reclassification of losses on interest rate hedges to interest expense	326			1,229
Ending balance	$	24,477		$	15,337