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Derivatives | 12 Months Ended
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Dec. 30, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
DERIVATIVES | DERIVATIVES The Company’s operations are exposed to market risks relating to commodity prices that affect the Company’s cost of raw materials, finished product prices and energy costs and the risk of changes in interest rates and foreign currency exchange rates. The Company makes limited use of derivative instruments to manage cash flow risks related to natural gas usage, diesel fuel usage, inventory, forecasted sales and foreign currency exchange rates. The Company does not use derivative instruments for trading purposes. At December 30, 2023, the Company had foreign currency forward contracts and interest rate swaps outstanding that qualified and were designated for hedge accounting as well as corn forward contracts and foreign currency forward contracts that did not qualify and were not designated for hedge accounting. Cash Flow Hedges In fiscal 2023, the Company entered into interest rate swaps that are designated as cash flow hedges. The notional amount of these swaps totaled $900.0 million. Under the contracts, the Company is obligated to pay a weighted average rate of 4.007% while receiving the 1-month SOFR rate. Under the terms of the interest rate swaps, the Company hedged a portion of its variable rate debt into the first quarter of 2026. At December 30, 2023, the aggregate fair value of these interest rate swaps was approximately $3.7 million. These amounts are included in other current assets, accrued expenses and noncurrent liabilities on the balance sheet, with an offset recorded in accumulated other comprehensive loss. In fiscal 2023, the Company also entered into cross currency swaps that are designated as cash flow hedges. The notional amount of these swaps was €519.2 million. Under the contracts, the Company is obligated to pay a 4.6% euro denominated fixed rate while receiving a weighted average U.S. dollar fixed rate of 5.799%. Under the terms of the cross currency swaps, the Company hedged its intercompany notes receivable into the first quarter of 2025. Accordingly, changes in the fair value of the cash flow hedge are initially recorded as gains and/or losses as a component of accumulated other comprehensive loss. We immediately reclassify from accumulated other comprehensive loss to earnings an amount to offset the remeasurement recognized in earnings associated with the respective intercompany loan. Additionally, we reclassify amounts from accumulated other comprehensive income/(loss) associated with the interest rate differential between the U.S. dollar and a Euro to interest expense. At December 30, 2023, the aggregate fair value of these cross currency swaps was approximately $10.8 million. These amounts are included in other current assets and noncurrent liabilities on the balance sheet, with an offset recorded in accumulated other comprehensive loss. In fiscal 2023, fiscal 2022 and fiscal 2021, the Company entered into foreign exchange option and forward contracts that are considered cash flow hedges. Under the terms of the foreign exchange contracts, the Company hedged a portion of its forecasted sales in currencies other than the functional currency through the fourth quarter of fiscal 2024. At December 30, 2023 and December 31, 2022, the aggregate fair value of these foreign exchange contracts was approximately $15.9 million and $13.8 million, respectively. The amounts are included in other current assets, accrued expenses, other assets and noncurrent liabilities on the balance sheet, with an offset recorded in accumulated other comprehensive loss. In fiscal 2022 and fiscal 2021, the Company entered into corn option contracts that are considered cash flow hedges. Under the terms of the corn option contracts the Company hedged a portion of its forecasted sales of BBP. At December 30, 2023, there are not any outstanding corn option contracts designated as cash flow hedges. At December 30, 2023 and December 31, 2022, the aggregate fair value of the corn contracts was approximately zero and $0.9 million, respectively. The amounts are included in other current assets on the balance sheet. In fiscal 2023, fiscal 2022 and fiscal 2021, the Company entered into soybean meal forward contracts to hedge a portion of its forecasted poultry meal sales. At December 30, 2023, there are not any outstanding soybean meal forward contracts designated as cash flow hedges. At December 30, 2023 and December 31, 2022, the aggregate fair value of the soybean meal contracts was approximately zero and $0.6 million, respectively. The amounts are included in other current assets on the balance sheet. At December 30, 2023, the Company had the following outstanding forward contract amounts that were entered into to hedge the future payments of intercompany note transactions, foreign currency transactions in currencies other than the functional currency and forecasted transactions in currencies other than the functional currency (in thousands):
Functional Currency |  | Contract Currency
Type | Amount |  | Type | Amount
Brazilian real | 170,788 |  |  | Euro | 31,272 |
Brazilian real | 1,546,487 |  |  | U.S. Dollar | 292,015 |
Euro | 48,435 |  |  | U.S. Dollar | 52,622 |
Euro | 40,614 |  |  | Polish zloty | 176,500 |
Euro | 11,177 |  |  | Japanese yen | 1,741,390 |
Euro | 25,043 |  |  | Chinese renminbi | 195,270 |
Euro | 18,373 |  |  | Australian dollar | 30,150 |
Euro | 2,797 |  |  | British pound | 2,415 |
Polish zloty | 35,023 |  |  | Euro | 8,066 |
Polish zloty | 2,941 |  |  | U.S. dollar | 740 |
British pound | 149 |  |  | Euro | 173 |
British pound | 75 |  |  | U.S. dollar | 95 |
Japanese yen | 145,199 |  |  | U.S. dollar | 994 |
U.S. dollar | 1,050 |  |  | Japanese yen | 149,000 |
U.S. dollar | 562,340 |  |  | Euro | 519,182 |
Australian dollar | 162 |  |  | Euro | 100 |
The above foreign currency contracts had an aggregate fair value of approximately $5.0 million and are included in other current assets, accrued expenses and noncurrent liabilities at December 30, 2023. The Company estimates the amount that will be reclassified from accumulated other comprehensive loss at December 30, 2023 into earnings over the next 12 months will be approximately $48.9 million. As of December 30, 2023, no amounts have been reclassified into earnings as a result of the discontinuance of cash flow hedges. The table below summarizes the effect of derivatives not designated as hedges on the Company’s consolidated statements of operations for the year ended December 30, 2023, December 31, 2022 and January 1, 2022 (in thousands):
|  |  |  | Loss or (Gain) Recognized in Income on Derivatives Not Designated as Hedges
|  |  |  | For The Year Ended
Derivatives not designated as hedging instruments |  | Location |  | December 30, 2023 | December 31, 2022 | January 1, 2022
Foreign exchange |  | Foreign currency loss/(gain) |  | $ | (2,031) |  | $ | 42,690 |  | $ | 21,698 |
Foreign exchange |  | Net sales |  | (1,789) |  | (1,108) |  | 1,178 |
Foreign exchange |  | Cost of sales and operating expenses |  | (294) |  | (949) |  | (844) |
Foreign exchange |  | Selling, general and administrative expense |  | (7,109) |  | (4,200) |  | 3,405 |
Corn options and futures |  | Net sales |  | 1,945 |  | (2,092) |  | (3,564) |
Corn options and futures |  | Cost of sales and operating expenses |  | (3,085) |  | 5,447 |  | 5,669 |
Heating oil swaps and options |  | Selling, general and administrative expense |  | 49 |  | 122 |  | — |
Soybean meal |  | Net sales |  | 282 |  | (1,730) |  | — |
Total |  |  |  | $ | (12,032) |  | $ | 38,180 |  | $ | 27,542 |
At December 30, 2023, the Company had forward purchase agreements in place for purchases of approximately $191.9 million of natural gas and diesel fuel. The Company intends to take physical delivery of the commodities under the forward purchase agreements and accordingly, these contracts are not subject to the requirements of fair value accounting because they qualify as normal purchases.

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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480237/815-40-50-5 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 5C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480434/815-10-50-5C Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 815 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//815/tableOfContent + Details
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