v3.26.1
DERIVATIVE FINANCIAL INSTRUMENTS (Tables)
 6 Months Ended
Jun. 28, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Derivative Instruments on a Gross Basis The following table presents the fair values of our open derivative financial instruments on a gross basis.
AssetsLiabilities
June 28,
2026		December 28,
2025		June 28,
2026		December 28,
2025
(in millions)
Derivatives using the “hedge accounting” method:
Commodity contracts$38 $26 $24 $2 
Derivatives using the “mark-to-market” method:
Commodity contracts5 2 7 1 
Total fair value of derivative instruments$44 $28 $31 $3 
Schedule of Derivative Assets and Liabilities
The following tables reconcile the gross amounts of derivative assets and liabilities to the net amounts presented in our condensed consolidated balance sheets and the related effects of cash collateral under netting arrangements that provide a legal right of offset of assets and liabilities.
June 28, 2026
Gross Amount of Derivative Assets/ LiabilitiesNetting of Derivative Assets/ LiabilitiesNet Derivative Assets/LiabilitiesNetting of Derivative and Cash Collateral
Net Amount Presented in the Condensed Consolidated Balance Sheet (1)
(in millions)
Assets:
Commodity contracts$44 $(22)$21 $7 $29 
Liabilities:
Commodity contracts$31 $(22)$9 $(6)$3 
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(1)Net assets are recorded in prepaid expenses and other current assets. Net liabilities are recorded in accrued expenses and other current liabilities. These balances include $17 million in excess collateral paid to and held by our brokers, which represents initial margin that exceeded the value of related open derivative positions.

December 28, 2025
Gross Amount of Derivative Assets/ LiabilitiesNetting of Derivative Assets/ LiabilitiesNet Derivative Assets/LiabilitiesNetting of Derivative and Cash Collateral
Net Amount Presented in the Condensed Consolidated Balance Sheet (1)
(in millions)
Assets:
Commodity contracts$28 $(3)$25 $3 $28 
Liabilities:
Commodity contracts$3 $(3)$— $— $— 
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(1)Net assets are recorded in prepaid expenses and other current assets. Net liabilities are recorded in accrued expenses and other current liabilities. These balances include $7 million in excess collateral paid to and held by our brokers, which represents the initial margin that exceeded the value of related open derivative position.
Schedule of Notional Amounts of Outstanding Derivative Positions
As of June 28, 2026, the notional volumes associated with open derivative instruments designated in cash flow hedging relationships were as follows:
VolumeMetric
Lean hogs717,702,000 Pounds
Corn26,164,000 Bushels
Soybean meal323,000 Tons
Natural Gas1,100,000 Million BTU
Diesel504,000 Gallons
As of June 28, 2026, the notional volumes associated with open derivative instruments designated in fair value hedging relationships were as follows:
VolumeMetric
Lean hogs21,840,000 Pounds
Corn10,640,000 Bushels
Soybeans1,485,000 Bushels
Schedule of Pre-tax Gains and Losses on Derivative Instruments
The following tables present the effects on our condensed consolidated financial statements of pre-tax gains and losses on derivative instruments designated in cash flow hedging relationships for the periods indicated:
Gains (Losses) Recognized in Other Comprehensive Income (Loss) on DerivativeGains (Losses) Reclassified from Accumulated Other Comprehensive Loss into Earnings
Three Months EndedThree Months Ended
June 28,
2026		June 29,
2025		June 28,
2026		June 29,
2025
(in millions)
Commodity contracts$31 $(82)$30 $(3)
Gains (Losses) Recognized in Other Comprehensive Income (Loss) on DerivativeGains (Losses) Reclassified from Accumulated Other Comprehensive Loss into Earnings
Six Months EndedSix Months Ended
June 28,
2026		June 29,
2025		June 28,
2026		June 29,
2025
(in millions)
Commodity contracts$22 $(38)$34 $(14)
Interest rate swaps— — (1)(1)
Total$22 $(38)$34 $(14)
As of June 28, 2026, the notional volumes associated with open derivative instruments using the “mark-to-market” method were as follows:
VolumeMetric
Commodity contracts:
Lean hogs31,949,000 Pounds
Corn11,372,000 Bushels
Soybean meal230,000 Tons
Soybeans205,000 Bushels
Wheat295,000 Bushels
Natural gas109,000 Million BTU
Diesel84,000 Gallons
Foreign currency contracts20,551,778 U.S. Dollars
The following table presents the effect of derivatives on the condensed consolidated statements of income for the periods indicated.
Three Months EndedSix Months Ended
June 28,
2026		June 29,
2025		June 28,
2026		June 29,
2025
(in millions)
Sales:
Cash flow hedging—commodity contracts
$26 $(6)$25 $(14)
Mark-to-market—commodity contracts
7 (20)3 (13)
Total derivative gain (loss) recognized in sales33 (25)27 (27)
Cost of sales:
Cash flow hedging—commodity contracts
4 2 10 1 
Fair value hedging—commodity contracts:
Change in fair value of derivatives14 (15)7 (14)
Change in fair value of related hedged items(13)15 (7)13 
Gain (loss) on closed derivatives (1)
4 (2)3 — 
Mark-to-market—commodity contracts
(2)4 (7)8 
Total derivative gain recognized in cost of sales6 4 6 8 
Selling, general and administrative expenses:
Mark-to-market—foreign currency contracts
1 (1)1 (1)
Interest expense:
Cash flow hedging—interest rate contracts
— — (1)(1)
Total derivative gain (loss)$39 $(23)$34 $(22)
________________
(1)Represents the amount of fair value hedge adjustment applied to the carrying amount of hedged assets that is recognized in cost of sales as the underlying hedged assets are relieved from inventories and charged to cost of sales.