The following table presents for each of the fair value hierarchies, the assets and liabilities that are measured at fair value on a recurring basis as of September 28, 2013 and December 29, 2012:

			September 28, 2013
			Fair value
			asset (liability)	Level 1	Level 2	Level 3
			$	$	$	$
(a)	Commodity futures and forward contracts⁽¹⁾
		Unrealized short-term derivative asset	2,077	270	1,807	-
		Unrealized long-term derivative asset	12	-	12	-
		Unrealized short-term derivative liability	(3,209)	-	(3,209)	-
		Unrealized long-term derivative liability	(161)	-	(161)	-
(b)	Inventories carried at market⁽²⁾		11,521	-	11,521	-
(c)	Interest rate swaps⁽³⁾		(188)	-	(188)	-
(d)	Forward foreign currency contracts⁽⁴⁾		(365)	-	(365)	-
(e)	Contingent consideration⁽⁵⁾		(3,161)	-	0	(3,161)

			December 29, 2012
			Fair value
			asset (liability)	Level 1	Level 2	Level 3
			$	$	$	$
(a)	Commodity futures and forward contracts⁽¹⁾
		Unrealized short-term derivative asset	3,184	690	2,494	-
		Unrealized long-term derivative asset	93	-	93	-
		Unrealized short-term derivative liability	(1,623)	-	(1,623)	-
		Unrealized long-term derivative liability	(43)	-	(43)	-
(b)	Inventories carried at market⁽²⁾		15,426	-	15,426	-
(c)	Interest rate swaps⁽³⁾		(396)	-	(396)	-
(d)	Forward foreign currency contracts⁽⁴⁾		(327)	-	(327)	-
(e)	Contingent consideration⁽⁵⁾		(4,398)	-	0	(4,398)

(1) Unrealized short-term derivative asset is included in prepaid expenses and other current assets, unrealized long-term derivative asset is included in other assets, unrealized short-term derivative liability is included in other current liabilities and unrealized long-term derivative liability is included in long-term liabilities on the consolidated balance sheets.

(2) Inventories carried at market are included in inventories on the consolidated balance sheets.

(3) The interest rate swaps are included in long-term liabilities on the consolidated balance sheets.

(4) The forward foreign currency contracts are included in accounts receivable or accounts payable and accrued liabilities on the consolidated balance sheets.

(5) Contingent consideration obligations are included in long-term liabilities (including the current portion thereof) on the consolidated balance sheets.

The Company's derivative contracts that are measured at fair value include exchange-traded commodity futures and forward commodity purchase and sale contracts. Exchange-traded futures are valued based on unadjusted quotes for identical assets priced in active markets and are classified as level 1. Fair value for forward commodity purchase and sale contracts is estimated based on exchange-quoted prices adjusted for differences in local markets. Local market adjustments use observable inputs or market transactions for similar assets or liabilities and, as a result, are classified as level 2. Based on historical experience with the Company's suppliers and customers, the Company's own credit risk, and the Company's knowledge of current market conditions, the Company does not view non-performance risk to be a significant input to fair value for the majority of its forward commodity purchase and sale contracts.

These exchange-traded commodity futures and forward commodity purchase and sale contracts are used as part of the Company's risk management strategy, and represent economic hedges to limit risk related to fluctuations in the price of certain commodity grains, as well as the price of cocoa. These derivative instruments are not designated as hedges for accounting purposes. Gains and losses on changes in the fair value of these derivative instruments are included in cost of goods sold on the consolidated statement of operations. For the quarter ended September 28, 2013, the Company recognized a loss of $1,950 (September 29, 2012 – gain of $3,075) and for the three quarters ended September 28, 2013, the Company recognized a loss of $2,892 (September 29, 2012 – gain of $1,178).

As at September 28, 2013, the notional amounts of open commodity futures and forward purchase and sale contracts were as follows (in thousands of bushels):

In addition, as at September 28, 2013, the Company also had open forward contracts to sell 215 lots of cocoa.

Grains inventory carried at fair value is determined using quoted market prices from the Chicago Board of Trade (“CBoT”). Estimated fair market values for grains inventory quantities at period end are valued using the quoted price on the CBoT adjusted for differences in local markets, and broker or dealer quotes. These assets are placed in level 2 of the fair value hierarchy, as there are observable quoted prices for similar assets in active markets. Gains and losses on commodity grains inventory are included in cost of goods sold on the consolidated statements of operations. As at September 28, 2013, the Company had 81,180 bushels of commodity corn and 529,338 bushels of commodity soybeans in inventories carried at market.

As at September 28, 2013, Opta Minerals held interest rate swaps with a notional value of Cdn $ 43,150 in the aggregate to pay fixed rates of 1.85% to 2.02%, plus a margin of 2.0% to 3.5% based on certain financial ratios of Opta Minerals, and receive a variable rate based on various reference rates including prime, bankers' acceptances or LIBOR, plus the same margin, until May 2017. The net notional value decreases in accordance with the quarterly principal repayments on Opta Minerals' non-revolving term credit facility (see note 8).

At each period end, the Company calculates the mark-to-market fair value of the interest rate swaps using a valuation technique using quoted observable prices for similar instruments as the primary input. Based on this valuation, the previously recorded fair value is adjusted to the current marked-to-market position. The marked-to-market gain or loss is placed in level 2 of the fair value hierarchy. As the interest rate swaps are designated as a cash flow hedge for accounting purposes, gains and losses on changes in the fair value of these derivative instruments are included on the consolidated statements of comprehensive earnings. For the quarter ended September 28, 2013, the Company recognized a loss of $ 90 (September 29, 2012 – loss of $ 51), net of income tax benefit of $ 24 (September 29, 2012 – income tax benefit of $ 44), and for the three quarters ended September 28, 2013, the Company recognized a gain of $ 208 (September 29, 2012 – loss of $ 241), net of income tax of $ 54 (September 29, 2012 – income tax benefit of $ 79).

As part of its risk management strategy, the Company enters into forward foreign exchange contracts to reduce its exposure to fluctuations in foreign currency exchange rates. For any open forward foreign exchange contracts at period end, the contract rate is compared to the forward rate, and a gain or loss is recorded. These contracts are placed in level 2 of the fair value hierarchy, as the inputs used in making the fair value determination are derived from and are corroborated by observable market data. While these forward foreign exchange contracts typically represent economic hedges that are not designated as hedging instruments, certain of these contracts may be designated as hedges. As at September 28, 2013, the Company had open forward foreign exchange contracts with a notional value of € 13,061 and $10. Gains and losses on changes in the fair value of these derivative instruments are included in foreign exchange loss (gain) on the consolidated statements of operations. For the quarter ended September 28, 2013, the Company recognized a loss of $ 429 (September 29, 2012 –loss of $ 16), and for the three quarters ended September 28, 2013, the Company recognized a loss of $ 38 (September 29, 2012 –gain of $ 453).

The fair value measurement of contingent consideration arising from business acquisitions is determined using unobservable (level 3) inputs. These inputs include: (i) the estimated amount and timing of the projected cash flows on which the contingency is based; and (ii) the risk-adjusted discount rate used to present value those cash flows. For the quarter and three quarters ended September 28, 2013, the change in the fair value of the contingent consideration liability reflected related payments of $ 1,074 in the aggregate, as well as (i) changes in the probability of achievement of the factors on which the contingencies are based, (ii) the accretion of interest expense, and (iii) changes in foreign currency exchange rates, which were not material individually or in the aggregate.