XML 56 R26.htm IDEA: XBRL DOCUMENT

DERIVATIVES AND HEDGING (Tables)

9 Months Ended

Jul. 29, 2012

Derivatives and hedging

Schedule of fair values of derivative instruments

				Fair Value (1)
		Location on Consolidated Statements of Financial Position		July 29, 2012		October 30, 2011
Asset Derivatives:
Derivatives Designated as Hedges:
Commodity contracts		Other current assets		$ 5,181		$ 58,753

Derivatives Not Designated as Hedges:
Commodity contracts		Other current assets		49		121

Total Asset Derivatives				$ 5,230		$ 58,874

Liability Derivatives:
Derivatives Designated as Hedges:
Commodity contracts		Accounts payable		$ 193		$ 351

Total Liability Derivatives				$ 193		$ 351

(1) Amounts represent the gross fair value of derivative assets and liabilities. The Company nets the derivative assets and liabilities for each of its hedging programs, including cash collateral, when a master netting arrangement exists between the Company and the counterparty to the derivative contract. The amount or timing of cash collateral balances may impact the classification of the derivative in the Consolidated Statement of Financial Position. See Note I - Fair Value Measurements for a discussion of these net amounts as reported in the Consolidated Statements of Financial Position.

Schedule of gains or losses (before tax) related to derivative instruments

Gain/(Loss)
Recognized in AOCL
(Effective Portion) (1)

Location on

Gain/(Loss)
Reclassified from
AOCL into Earnings
(Effective Portion) (1)

Gain/(Loss)
Recognized in
Earnings (Ineffective
Portion) (2) (3)

Three Months Ended

Consolidated

Three Months Ended

Three Months Ended

Cash Flow Hedges:

July 29,
2012

July 31,
2011

Statements
of Operations

July 29,
2012

July 31,
2011

July 29,
2012

July 31,
2011

Commodity contracts

$ 25,749

$ 537

Cost of products sold

$

1,317

$

15,257

$

0

$

(2,806)

Location on

Gain/(Loss)

Recognized in Earnings
(Effective Portion) (4)

Gain/(Loss)

Recognized in
Earnings (Ineffective

Portion) (2) (5)

Consolidated

Three Months Ended

Three Months Ended

Fair Value Hedges:

Statements

of Operations

July 29,
2012

July 31,

2011

July 29,
2012

July 31,
2011

Commodity contracts

Cost of products sold

$

(2,658)

$

(4,232)

$

(2,407)

$

346

Location on

Gain/(Loss)

Recognized

in Earnings

Consolidated

Three Months Ended

Derivatives Not

Designated as Hedges:

Statements

of Operations

July 29, 2012

July 31,

2011

Commodity contracts

Cost of products sold

$

0

$

(58)

Foreign exchange contracts

Net sales

$

0

$

113

Derivative Gains and Losses: Gains or losses (before tax, in thousands) related to the Company’s derivative instruments for the nine months ended July 29, 2012, and July 31, 2011, were as follows:

Gain/(Loss)

Recognized in AOCL

(Effective Portion) (1)

Location on
Consolidated

Gain/(Loss)

Reclassified from

AOCL into Earnings

(Effective Portion) (1)

Gain/(Loss)

Recognized in
Earnings (Ineffective

Portion) (2) (3)

Nine Months Ended

Nine Months Ended

Nine Months Ended

Cash Flow Hedges:

July 29,
2012

July 31,
2011

Statements

of Operations

July 29,
2012

July 31,
2011

July 29,
2012

July 31,
2011

Commodity contracts

$ 13,664

$ 41,200

Cost of products sold

$

15,958

$

29,714

$

0

$

(8,134)

Location on

Gain/(Loss)

Recognized in Earnings
(Effective Portion) (4)

Gain/(Loss)

Recognized in
Earnings (Ineffective

Portion) (2) (5)

Consolidated

Nine Months Ended

Nine Months Ended

Fair Value Hedges:

Statements
of Operations

July 29,
2012

July 31,

2011

July 29,
2012

July 31,
2011

Commodity contracts

Cost of products sold

$

2,691

$

(15,896)

$

(2,361)

$

(73)

Location on

Consolidated

Gain/(Loss)

Recognized

in Earnings

Nine Months Ended

Derivatives Not

Designated as Hedges:

Statements

of Operations

July 29,
2012

July 31,

2011

Commodity contracts

Cost of products sold

$

46

$

(2,005)

Foreign exchange contracts

Net sales

$

0

$

(78)

(1) Amounts represent gains or losses in AOCL before tax. See Note F — Comprehensive Income for the after tax impact of these gains or losses on net earnings.

(2) There were no gains or losses excluded from the assessment of hedge effectiveness during the third quarter or first nine months of fiscal years 2012 and 2011.

(3) There were no gains or losses resulting from the discontinuance of cash flow hedges during the third quarter or first nine months of fiscal years 2012 and 2011. However, effective January 30, 2011, the Company de-designated and discontinued hedge accounting for its soybean meal futures contracts. At the date of de-designation of these hedges, gains of $17.7 million (before tax) were deferred in AOCL, with $1.3 million (before tax) remaining as of July 29, 2012. These gains will remain in AOCL until the hedged transactions occur or it is probable the hedged transactions will not occur. Gains or losses related to these contracts after the date of de-designation have been recognized in earnings as incurred.

(4) Amounts represent losses on commodity contracts designated as fair value hedges that were closed during the third quarter or first nine months of fiscal years 2012 and 2011, which were offset by a corresponding gain on the underlying hedged purchase commitment. Additional gains or losses related to changes in the fair value of open commodity contracts, along with the offsetting gain or loss on the hedged purchase commitment, are also marked-to-market through earnings with no impact on a net basis.

(5) There were no gains or losses recognized as a result of a hedged firm commitment no longer qualifying as a fair value hedge during the third quarter or first nine months of fiscal years 2012 and 2011.

Derivatives not designated as hedges

Derivatives and hedging

Schedule of outstanding commodity or foreign exchange contracts

		Volume
Commodity		July 29, 2012		October 30, 2011
Soybean meal		-		4,300 tons

Cash Flow Hedges

Derivatives and hedging

Schedule of outstanding commodity or foreign exchange contracts

		Volume
Commodity		July 29, 2012		October 30, 2011
Corn		11.3 million bushels		20.8 million bushels
Natural gas		0.1 million MMBTU’s		0.5 million MMBTU’s

Fair Value Hedges

Derivatives and hedging

Schedule of outstanding commodity or foreign exchange contracts

		Volume
Commodity		July 29, 2012		October 30, 2011
Corn		15.2 million bushels		12.4 million bushels
Lean hogs		0.4 million cwt		1.3 million cwt

Tabular disclosure of the location and amount of gains and losses reported in the statement of financial performance, or when applicable, the statement of financial position. For example, (a) gains and losses recognized in the income statement on derivative instruments designated and qualifying as hedging instruments in fair value hedges and related hedged items designated and qualifying in fair value hedges and (b) gains and losses initially recognized in other comprehensive income on derivative instruments designated and qualifying as cash flow hedges.

+ References+ Details

Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

+ References+ Details