An alternative breakdown of hedging derivatives is shown below:
| (in millions of euros) | Notes | 31/12/2019 | 31/12/2018 |
|---|---|---|---|
| Fair value of derivatives hedging liabilities | Fair value of derivatives hedging liabilities Notes 41.3 | Fair value of derivatives hedging liabilities 31/12/2019 3,387 | Fair value of derivatives hedging liabilities 31/12/2018 1,972 |
| Fair value of derivatives hedging net foreign investments | Fair value of derivatives hedging net foreign investments 31/12/2019 261 | Fair value of derivatives hedging net foreign investments 31/12/2018 106 | |
| Fair value of other hedging derivatives (commodities) | Fair value of other hedging derivatives (commodities) 31/12/2019 281 | Fair value of other hedging derivatives (commodities) 31/12/2018 (643) | |
| FAIR VALUE OF HEDGING DERIVATIVES | FAIR VALUE OF HEDGING DERIVATIVES 31/12/2019 3,929 | FAIR VALUE OF HEDGING DERIVATIVES 31/12/2018 1,435 |
The EDF group hedges the exposure to changes in the fair value of fixed-rate debts. The derivatives used for this hedging are fixed/floating interest rate swaps and cross currency swaps, with changes in fair value recorded in the income statement. Fair value hedges also include currency hedging instruments on certain firm purchase commitments.
In 2019, the ineffective portion of fair value hedges represents a loss of €(17) million (loss of €(3) million in 2018), included in the financial result.
The EDF group uses cash flow hedging principally for the following purposes:
The EDF group also hedges the currency risk associated with fuel and commodity purchases.
The ineffective portion of cash flow hedges in 2019 represents a gain of €3 million which was included in the financial result (gain of €5 million in 2018).
Hedging of net foreign investments is used for protection against exposure to the exchange rate risk related to net investments in the Group’s foreign entities.
This risk is hedged at Group level either by contracting debts for investments in the same currency, or through the markets, in which case the Group uses currency swaps and forward exchange contracts.
Changes during the period in the fair value of hedging instruments included in equity (EDF share) are detailed below:
| 2019 | 2018 | |||||
|---|---|---|---|---|---|---|
| (in millions of euros) | Gross changes in fair value recorded inequity | Gross changes in fair value transferred to income –Recycling | Gross changes in fair value transferred to income –Ineffectiveness | Gross changes in fair value recorded inequity | Gross changes in fair value transferred to income-Recycling | Gross changes in fair value transferred to income-Ineffectiveness |
| Interest rate hedging | Interest rate hedging 2019 (39) | Interest rate hedging 2018 (106) | 3 | (73) | - | 1 |
| Exchange rate hedging | Exchange rate hedging 2019 (200) | Exchange rate hedging 2018 (156) | (17) | 890 | 443 | (5) |
| Net foreign investment hedging | Net foreign investment hedging 2019 (416) | Net foreign investment hedging 2018 (448) | - | (85) | - | - |
| Commodity hedging | Commodity hedging 2019 1,482 | Commodity hedging 2018 719 | 3 | (1,043) | (788) | (9) |
| HEDGING DERIVATIVES (3) | HEDGING DERIVATIVES (3)2019 827 | HEDGING DERIVATIVES (3)2018 9 | (11) | (311) | (345) | (13) |
(1) +/( ): increase/(decrease) in equity (EDF share).
(2) +/( ): increase/(decrease) in net income (EDF share).
(3) Excluding associates and joint ventures.
