Foreign Currency Exchange Rate Risk Table of Contents The Hershey Company | 2020 Form 10-K | Page 42 The fair value of foreign currency forward exchange contracts represents the difference between the contracted and current market foreign currency exchange rates at the end of the period. We estimate the fair value of foreign currency forward exchange contracts on a quarterly basis by obtaining market quotes of spot and forward rates for contracts with similar terms, adjusted where necessary for maturity differences. At December 31, 2020 and 2019, the net fair value of these instruments was a liability of $3.1 million and an asset of $1.0 million, respectively. In addition, assuming an unfavorable 10% change in year-end foreign currency exchange rates, the fair value of these instruments would have declined by $25.6 million and $55.4 million, respectively, generally offset by a reduction in foreign exchange associated with our transactional activities. A summary of foreign currency forward exchange contracts and the corresponding amounts at contracted forward rates is as follows: We are exposed to currency fluctuations related to manufacturing or selling products in currencies other than the U.S. dollar. We may enter into foreign currency forward exchange contracts to reduce fluctuations in our long or short currency positions relating primarily to purchase commitments or forecasted purchases for equipment, raw materials and finished goods denominated in foreign currencies. We also may hedge payment of forecasted intercompany transactions with our subsidiaries outside of the United States. We generally hedge foreign currency price risks for periods from 3 to 12 months. December 31, 2020 2019 Contract Amount Primary Currencies Contract Amount Primary Currencies In millions of dollars Foreign currency forward exchange contracts to purchase foreign currencies $ 45.4 Euros Malaysian ringgit Swiss Franc $ 110.8 Euros British pound Malaysian ringgit Foreign currency forward exchange contracts to sell foreign currencies $ 178.0 Canadian dollars Brazilian reals Mexican peso Japanese yen British pound $ 125.8 Canadian dollars Brazilian reals Japanese yen