Company: REX
Filing Date: 2025-06-04
Form Type: 10-Q
Source: 0000930413-25-001941
Chunk: 59

Company: REX AMERICAN RESOURCES Corp
Filing Date: 2025-06-04
Form: 10-Q
Item: Part I, Item 8
Chunk 59
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 measure fair values which are provided below. The Company carries certain cash equivalents, investments, and derivative instruments at
fair value.

14

The fair values of derivative assets and
liabilities traded in the over-the-counter market are determined using quantitative models that require the use of multiple market
inputs including interest rates, prices and indices to generate pricing and volatility factors, which are used to value the position.
The predominance of market inputs are actively quoted and can be validated through external sources, including brokers, market
transactions and third-party pricing services. Estimation risk is greater for derivative asset and liability positions that are
either option-based or have longer maturity dates where observable market inputs are less readily available or are unobservable,
in which case interest rate, price or index scenarios are extrapolated in order to determine the fair value. The fair values of
derivative assets and liabilities include adjustments for market liquidity, counterparty credit quality, the Company’s own
credit standing and other specific factors, where appropriate.

To ensure the prudent application of estimates
and management judgment in determining the fair value of derivative assets and liabilities, investments and property and equipment,
various processes and controls have been adopted, which include: (i) model validation that requires a review and approval for pricing,
financial statement fair value determination and risk quantification; and (ii) periodic review and substantiation of profit and
loss reporting for all derivative instruments.

Financial assets and liabilities measured
at fair value on a recurring basis at April 30, 2025 are summarized below (amounts in thousands):

    Level 1  
    Level 2  
    Level 3  
    Fair Value 

    Forward purchase contracts asset (1) 
    $-  
    $840  
    $-  
    $840 

    Commodity futures asset (2) 
     669  
     -  
     -  
     669 

    Total assets 
    $669  
    $840  
    $-  
    $1,509 

    Forward purchase contracts liability (3) 
    $-  
    $1,105  
    $-  
    $1,105 

Financial assets and liabilities measured
at fair value on a recurring basis at January 31, 2025 are summarized below (amounts in thousands):

    Level 1  
    Level 2  
    Level 3  
    Fair Value 

    Forward