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DERIVATIVES AND HEDGING (Tables) | 6 Months Ended
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Apr. 27, 2025
Derivative [Line Items] |
Schedule of fair values of derivative instruments | The gross fair values of the Company’s derivative instruments designated as hedges are:
| April 27, 2025 | October 27, 2024
In thousands |  | Assets |  | Liabilities |  | Assets |  | Liabilities
Gross Fair Value of Commodity Contracts |  | $ | 11,120 |  |  | $ | (3,055) |  |  | $ | 9,851 |  |  | $ | (12,638) |
Counterparty and Collateral Netting Offset(1) |  | 2,276 |  |  | 3,055 |  |  | (1,785) |  |  | 12,638 |
Amounts Recognized on Consolidated Statements of Financial Position(2) |  | $ | 13,396 |  |  | $ | — |  |  | $ | 8,066 |  |  | $ | — |
(1) Per the terms of the Company’s master netting arrangements, the gross fair value of the Company’s commodity contracts was offset by the right to reclaim net cash collateral of $5.3 million (including cash of $5.6 million and $0.2 million of realized loss) as of April 27, 2025, and the right to reclaim net cash collateral of $10.9 million (including cash of $26.5 million and $15.6 million of realized loss) as of October 27, 2024. (2) The Company’s commodity contracts are reflected in Prepaid Expenses and Other Current Assets.
Schedule of fair value hedge assets (liabilities) | The carrying amount of the Company’s fair value hedged assets (liabilities) are:
In thousands | Location on Consolidated Statements of Financial Position | April 27, 2025 |  | October 27, 2024
Commodity Contracts | Accounts Payable(1) | $ | 2 |  |  | $ | (2,902) |
(1) Represents the carrying amount of fair value hedged assets and liabilities, which are offset by other assets included in master netting arrangements described above.
Schedule of gains or losses related to derivative instruments | The pre-tax gains (losses) recognized in AOCL related to the Company’s derivative instruments are:
| Quarter Ended |  | Six Months Ended
In thousands |  | April 27, 2025 |  | April 28, 2024 |  | April 27, 2025 |  | April 28, 2024
Commodity Contracts |  | $ | (6,135) |  |  | $ | 7,299 |  |  | $ | 13,000 |  |  | $ | 1,685 |
Excluded Component(1) |  | (96) |  |  | 657 |  |  | (183) |  |  | 1,813 |
(1) Represents the time value of commodity options excluded from the assessment of effectiveness for which the difference between changes in fair value and periodic amortization is recorded in AOCL. The pre-tax gains (losses) reclassified from AOCL into earnings related to the Company’s derivative instruments are:
| Location on Consolidated Statements of Operations | Quarter Ended |  | Six Months Ended
In thousands |  | April 27, 2025 |  | April 28, 2024 |  | April 27, 2025 |  | April 28, 2024
Commodity Contracts | Cost of Products Sold |  | $ | (1,326) |  |  | $ | (8,155) |  |  | $ | (3,467) |  |  | $ | (19,756) |
Interest Rate Contracts | Interest Expense |  | 247 |  |  | 247 |  |  | 494 |  |  | 494 |
See Note H - Accumulated Other Comprehensive Loss for the after-tax impact of these gains or losses on Net Earnings. Consolidated Statements of Operations Impact: The effect on the Consolidated Statements of Operations for pre-tax gains (losses) related to the Company’s derivative instruments are:
| Quarter Ended |  | Six Months Ended
In thousands | April 27, 2025 |  | April 28, 2024 |  | April 27, 2025 |  | April 28, 2024
Net Earnings Attributable to Hormel Foods Corporation | $ | 180,017 |  |  | $ | 189,278 |  |  | $ | 350,592 |  |  | $ | 408,140 |
Cash Flow Hedges - Commodity Contracts |  |  |  |  |  |  |
Gain (Loss) Reclassified from AOCL | (1,326) |  |  | (8,155) |  |  | (3,467) |  |  | (19,756) |
Amortization of Excluded Component from Options | (211) |  |  | (850) |  |  | (419) |  |  | (2,006) |
Fair Value Hedges - Commodity Contracts |  |  |  |  |  |  |
Gain (Loss) on Commodity Futures(1) | (571) |  |  | 1,033 |  |  | 1,133 |  |  | 4,628 |
Total Gain (Loss) on Commodity Contracts(2) | (2,107) |  |  | (7,972) |  |  | (2,753) |  |  | (17,134) |
Cash Flow Hedges - Interest Rate Contracts |  |  |  |  |  |  |
Gain (Loss) Reclassified from AOCL | 247 |  |  | 247 |  |  | 494 |  |  | 494 |
Fair Value Hedge - Interest Rate Contracts |  |  |  |  |  |  |
Amortization of Loss Due to Discontinuance of Fair Value Hedge(3) | — |  |  | (3,125) |  |  | — |  |  | (6,250) |
Total Gain (Loss) on Interest Rate Contracts(4) | 247 |  |  | (2,878) |  |  | 494 |  |  | (5,755) |
Total Gain (Loss) Recognized in Earnings | $ | (1,860) |  |  | $ | (10,849) |  |  | $ | (2,259) |  |  | $ | (22,890) |
(1) Represents gains or losses on commodity contracts designated as fair value hedges that were closed during the quarter and six months ended April 27, 2025, and April 28, 2024, which were offset by a corresponding gain or loss 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. (2) Total Gain (Loss) on Commodity Contracts is recognized in earnings through Cost of Products Sold. (3) Represents the fair value hedging adjustment amortized through earnings. (4) Total Gain (Loss) on Interest Rate Contracts is recognized in earnings through Interest Expense.
Cash Flow Hedges |
Derivative [Line Items] |
Schedule of outstanding commodity futures contracts | The Company’s outstanding contracts related to its commodity hedging programs include:
In millions | April 27, 2025 |  | October 27, 2024
Corn | 30.7 |  | bushels |  | 29.2 |  | bushels
Lean Hogs | 200.6 |  | pounds |  | 175.6 |  | pounds
Natural Gas | 3.0 |  | MMBtu |  | 4.2 |  | MMBtu
Diesel Fuel | 6.0 |  | gallons |  | 4.0 |  | gallons

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