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DERIVATIVES AND HEDGING (Tables)

3 Months Ended

Jan. 28, 2018

DERIVATIVES AND HEDGING

Schedule of fair values of derivative instruments

The fair values of the Company’s derivative instruments (in thousands) as of January 28, 2018, and October 29, 2017, were as follows:

			Fair Value (1)
	Location on Consolidated Statements of Financial Position		January 28, 2018				October 29, 2017
Asset Derivatives:
Derivatives Designated as Hedges:
Commodity contracts	Other current assets		$	(390	)		$	326
Derivatives Not Designated as Hedges:
Commodity contracts	Other current assets		12				—
Total Asset Derivatives			$	(378	)		$	326

(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 Statements of Financial Position.  See Note K “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

Gains or losses (before tax, in thousands) related to the Company’s derivative instruments for the first quarter ended January 28, 2018, and January 29, 2017, were as follows:

		Gain/(Loss) Recognized in AOCL (Effective Portion) (1)								Location on Consolidated Statements of Operations		Gain/(Loss) Reclassified from AOCL into Earnings (Effective Portion) (1)								Gain/(Loss) Recognized in Earnings (Ineffective Portion) (2) (4)
		Three Months Ended										Three Months Ended								Three Months Ended
Cash Flow Hedges:		January 28, 2018				January 29, 2017						January 28, 2018				January 29, 2017				January 28, 2018				January 29, 2017
Commodity contracts		$	(387	)		$	(646	)		Cost of products sold		$	608			$	1,469			$	(90	)		$	—

						Location on Consolidated Statements of Operations		Gain/(Loss) Recognized in Earnings (Effective Portion) (3)								Gain/(Loss) Recognized in Earnings (Ineffective Portion) (2) (5)
								Three Months Ended								Three Months Ended
Fair Value Hedges:								January 28, 2018				January 29, 2017				January 28, 2018				January 29, 2017
Commodity contracts						Cost of products sold		$	557			$	(54	)		$	(249	)		$	—

Location on Consolidated Statements of Operations

Gain/(Loss) Recognized in Earnings

Three Months Ended

Derivatives Not Designated as Hedges:

January 28, 2018

January 29, 2017

Commodity contracts

Cost of products sold

$

12

$

(228

)

(1) Amounts represent gains or losses in AOCL before tax.  See Note H “Accumulated Other Comprehensive Loss” 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 quarter.

(3) Amounts represent losses on commodity contracts designated as fair value hedges that were closed during the quarter, 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.

(4) There were no gains or losses resulting from the discontinuance of cash flow hedges during the quarter.

(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 quarter.

Derivatives not designated as hedges

DERIVATIVES AND HEDGING

Schedule of outstanding commodity futures contracts

As of January 28, 2018, and October 29, 2017, the Company had the following outstanding futures and options contracts related to these programs:

		Volume
Commodity		January 28, 2018		October 29, 2017
Corn		0.2 million bushels		—

Cash Flow Hedges

DERIVATIVES AND HEDGING

Schedule of outstanding commodity futures contracts

As of January 28, 2018, and October 29, 2017, the Company had the following outstanding commodity futures contracts that were entered into to hedge forecasted purchases:

		Volume
Commodity		January 28, 2018		October 29, 2017
Corn		11.3 million bushels		11.5 million bushels
Lean hogs		0.2 million cwt		0.3 million cwt

Fair Value Hedges

DERIVATIVES AND HEDGING

Schedule of outstanding commodity futures contracts

As of January 28, 2018, and October 29, 2017, the Company had the following outstanding commodity futures contracts designated as fair value hedges:

		Volume
Commodity		January 28, 2018		October 29, 2017
Corn		2.6 million bushels		4.1 million bushels
Lean hogs		0.3 million cwt		0.4 million cwt

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-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4C
-URI http://asc.fasb.org/extlink&oid=84234895&loc=SL5624171-113959

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