3. Fair Value Measurements

3 Months Ended

Mar. 25, 2012

3. FAIR VALUE MEASUREMENT [Abstract]

Fair Value Disclosures [Text Block]

3.     FAIR VALUE MEASUREMENTS

The asset (liability) amounts recorded in the Condensed Consolidated Balance Sheets (carrying amounts) and the estimated fair values of financial instruments at March 25, 2012 and December 25, 2011 consisted of the following:

	March 25, 2012						December 25, 2011
	Carrying Amount			Fair Value			Carrying Amount			Fair Value
				(In thousands)
Short-term investments in available-for-sale securities	$	156		$	156		$	157		$	157
Commodity derivative assets(a):
Futures	3,399			3,399			2,870			2,870
Long-term investments in available-for-sale securities	591			591			497			497
Commodity derivative liabilities(b):
Futures	(3,745		)	(3,745		)	(2,120		)	(2,120		)
Options	—			—			(603		)	(603		)
Long-term debt and other borrowing arrangements(c)	(1,265,124		)	(1,289,698		)	(1,423,612		)	(1,421,517		)
Note payable to JBS USA Holdings, Inc.	—			—			(50,000		)	(50,077		)

(a) Commodity derivative assets are included in Prepaid expenses and other current assets on the Condensed Consolidated Balance Sheet.

(b) Commodity derivative liabilities are included in Accrued expenses on the Condensed Consolidated Balance Sheet.

(c) The fair values of the Company’s long-term debt and other borrowing arrangements were estimated by calculating the net present value of future payments for each debt obligation or borrowing by: (i) using a risk-free rate applicable for an instrument with a life similar to the remaining life of each debt obligation or borrowing plus the current estimated credit risk spread for the Company or (ii) using the quoted market price at March 25, 2012 or December 25, 2011.

The carrying amounts of our cash and cash equivalents, derivative trading accounts margin cash, restricted cash and cash equivalents, accounts receivable, accounts payable and certain other liabilities approximate their fair values due to their relatively short maturities. The Company adjusts its investments, commodity derivative assets and commodity derivative liabilities to fair value based on quoted market prices in active markets for identical instruments, quoted market prices in active markets for similar instruments with inputs that are observable for the subject instrument, or unobservable inputs such as discounted cash flow models or valuations.

The Company follows guidance under ASC Topic 820, Fair Value Measurements and Disclosures, which establishes a framework for measuring fair value and required enhanced disclosures about fair value measurements. The guidance under ASC Topic 820 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. ASC Topic 820 also requires disclosure about how fair value was determined for assets and liabilities and established a hierarchy for which these assets and liabilities must be grouped, based on significant levels of inputs as follows:

Level 1	Unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2	Quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or
Level 3	Unobservable inputs, such as discounted cash flow models or valuations.

The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

As of March 25, 2012, the Company held certain items that are required to be measured at fair value on a recurring basis. These included cash and cash equivalents, derivative assets and liabilities, short-term investments in available-for-sale securities and long-term investments in available-for-sale securities. Cash equivalents consist of short-term, highly liquid, income-producing investments such as money market funds and other funds that have maturities of 90 days or less. Derivative assets and liabilities consist of long and short positions on both exchange-traded commodity futures and commodity options as well as margin cash on account with the Company’s derivatives brokers. Short-term investments in available-for-sale securities consist of short-term, highly liquid, income-producing investments such as municipal debt securities that have maturities of greater than 90 days but less than one year. Long-term investments in available-for-sale securities consist of income-producing investments such as municipal debt securities, corporate debt securities, equity securities and fund-of-funds units that have maturities of greater than one year.

The following items were measured at fair value on a recurring basis at March 25, 2012:

	Level 1			Level 2		Level 3		Total
				(In thousands)
Short-term investments in available-for-sale securities	$	—		$	156	$	—	$	156
Commodity derivative assets:
Futures	3,399			—		—		3,399
Long-term investments in available-for-sale securities	—			532		59		591
Commodity derivative liabilities:
Futures	(3,745		)	—		—		(3,745		)

Financial assets and liabilities classified in Level 1 at March 25, 2012 include cash and cash equivalents, restricted cash and cash equivalents, equity securities and commodity futures derivative instruments traded in active markets. The valuation of these instruments is determined using a market approach, taking into account current interest rates, creditworthiness, and liquidity risks in relation to current market conditions, and is based upon unadjusted quoted prices for identical assets in active markets. The valuation of financial assets and liabilities in Level 2 is determined using a market approach based upon quoted prices for similar assets and liabilities in active markets or other inputs that are observable for substantially the full term of the financial instrument. Level 2 securities primarily include fixed income securities and commodity option derivative instruments. The valuation of financial assets in Level 3 is determined using an income approach based on unobservable inputs such as discounted cash flow models or valuations. The Company’s sole Level 3 financial asset at March 25, 2012 was a fund-of-funds investment.

The following table presents activity for the thirteen weeks ended March 25, 2012 and March 27, 2011, respectively, related to the Company’s investment in a fund-of-funds asset that is measured at fair value on a recurring basis using Level 3 inputs:

	Thirteen Weeks Ended
	March 25, 2012		March 27, 2011
	(In thousands)
Balance at beginning of period	$	59	$	1,190
Included in other comprehensive income	—		43
Balance at end of period	$	59	$	1,233

In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records certain assets and liabilities at fair value on a nonrecurring basis. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges when required by U.S. GAAP. Certain long-lived assets held for sale with a carrying amount of $2.0 million were written down to their fair value of $0.7 million, resulting in a loss of $1.3 million recorded in earnings during the thirteen weeks ended March 25, 2012. These assets are classified as Level 2 assets because their fair value can be corroborated based on observable market data.