v3.26.1
Financial Derivatives
 3 Months Ended
Mar. 31, 2026
Financial Derivatives [Abstract]  
Financial derivatives
19. Financial derivatives

 

The Company uses a variety of derivative financial instruments and physical contracts to manage its exposure to foreign currency and commodity price fluctuations.

 

Foreign currency forward and option contracts

 

The Company enters into non-designated hedges under the authoritative guidance for derivatives and hedging to manage the exposure of foreign exchange rate fluctuations. The Company adjusts its non-designated hedges quarterly. The nominal value of approximately $42.2 million and $53.2 million contracts with maturities of three to twelve months were held as of December 31, 2025 and March 31, 2026, respectively.

 

Commodity contracts

 

The Company entered into commodity contracts to manage the exposure of raw materials price fluctuations, resulting in recognized gain of nil and $197,849 for the three months ended March 31, 2025 and 2026, respectively. The change in fair value of the commodity contracts of nil and $416,276 were recorded in Derivatives assets as of December 31, 2025 and March 31, 2026, respectively.

 

As of March 31, 2026, the Company held $548,271 (note 2) cash collateral to secure commodity contracts with a total nominal value of approximately $3.7 million. The commodity contracts are set to mature within two to six months from March 31, 2026. The Company did not hold any outstanding commodity contracts as of December 31, 2025.

The fair value of the financial derivatives as of December 31, 2025 and March 31, 2026 were as follows:

 

   December 31,
2025		   March 31,
2026		 
Derivatives not designed as hedging instruments          
Derivatives assets – Commodity contracts, prepayments and other receivables (note 5)  $
-
   $416,535 
           
Derivatives liabilities  - Foreign exchange contracts, accrued expenses and other payables (note 15)  $728,423   $2,287,144 

 

The gain (loss) related to the Company’s derivative instruments for the three months period ended March 31, 2025 and 2026 were as follows:

 

   For the three months
ended March 31,		 
   2025   2026 
Foreign currency forward and option contracts  $
-
   $(1,520,380)
Commodity contract   
-
    614,125 
    
-
    (906,255)

 

Refer to note 22 for detailed disclosures regarding fair value measurements.