Quantitative and Qualitative Disclosure About Market Risks Hog Markets:  The Company’s earnings are affected by  fluctuations in the live hog market. To minimize the impact  on earnings, and to ensure a steady supply of quality hogs,  the Company has entered into contracts with producers for  the purchase of hogs at formula-based prices over periods  of up to 10 years. Purchased hogs under contract accounted  for 94 percent and 98 percent of the total hogs purchased by  the Company in fiscal years 2014 and 2013, respectively. The  majority of these contracts use market-based formulas based  on hog futures, hog primal values, or industry reported hog  markets. Other contracts use a formula based on the cost of  production, which can fluctuate independently from hog mar- kets. Under normal, long-term market conditions, changes  in the cash hog market are offset by proportional changes in  primal values. Therefore, a hypothetical 10 percent change in  the cash hog market would have had an immaterial effect on  the Company’s results of operations. Certain procurement contracts allow for future hog deliveries  (firm commitments) to be forward priced. The Company  generally hedges these firm commitments by using hog  futures contracts. These futures contracts are designated  and accounted for as fair value hedges. The change in the  market value of such futures contracts is highly effective at  offsetting changes in price movements of the hedged item,  and the Company evaluates the effectiveness of the contracts  on a regular basis. Changes in the fair value of the futures  contracts, along with the gain or loss on the firm commitment,  are marked-to-market through earnings and are recorded on  the Consolidated Statements of Financial Position as a current  asset and liability, respectively. The fair value of the Company’s  open futures contracts as of October 26, 2014, was $0.6 million  compared to $(10.9) million as of October 27, 2013. The Company measures its market risk exposure on its hog  futures contracts using a sensitivity analysis, which considers  a hypothetical 10 percent change in market prices. A 10  percent increase in market prices would have negatively  impacted the fair value of the Company’s October 26, 2014  open contracts by $6.1 million, which in turn would lower the  Company’s future cost of purchased hogs by a similar amount. Turkey and Hog Production Costs:  The Company raises or  contracts for live turkeys and hogs to meet some of its raw  material supply requirements. Production costs in raising  turkeys and hogs are subject primarily to fluctuations in  feed prices and, to a lesser extent, fuel costs. Under normal,  long-term market conditions, changes in the cost to produce  turkeys and hogs are offset by proportional changes in their  respective markets. To reduce the Company’s exposure to changes in grain prices,  the Company utilizes a hedge program to offset the fluctuation  in the Company’s future direct grain purchases. This program  currently utilizes corn futures for JOTS, and these contracts  are accounted for under cash flow hedge accounting. The  The Company measures its foreign currency exchange risk  by using a 10 percent sensitivity analysis on the Company’s  primary foreign net asset position, the Chinese yuan, as of  October 26, 2014. A 10 percent strengthening in the value of  the yuan relative to the U.S. dollar would result in other com- prehensive income of approximately $13.3 million pretax. A 10  percent weakening in the value of the yuan relative to the U.S.  dollar would result in other comprehensive loss of approxi- mately $10.9 million pretax. 30 International:  The fair values of certain Company assets are  subject to fluctuations in foreign currencies. The Company’s  net asset position in foreign currencies as of October 26, 2014,  was $214.8 million, compared to $216.6 million as of October  27, 2013, with most of the exposure existing in Chinese yuan  and Philippine pesos. Changes in currency exchange rates  impact the fair values of Company assets either currently  through the Consolidated Statements of Operations as cur- rency gains/losses, or by affecting other comprehensive loss. Investments:  The Company holds trading securities as  part of a rabbi trust to fund certain supplemental executive  retirement plans and deferred income plans. As of October 26,  2014, the balance of these securities totaled $117.2 million.  A majority of these securities represent fixed income funds.  The Company is subject to market risk due to fluctuations in  the value of the remaining investments, as unrealized gains  and losses associated with these securities are included in  the Company’s net earnings on a mark-to-market basis. A  10 percent decline in the value of the investments not held  in fixed income funds would have a direct negative impact to  the Company’s pretax earnings of approximately $3.9 million,  while a 10 percent increase in value would have a positive  impact of the same amount. Long-Term Debt:  A principal market risk affecting the  Company is the exposure to changes in interest rates on the  Company’s fixed-rate, long-term debt. Market risk for fixed- rate, long-term debt is estimated as the potential increase in  fair value, resulting from a hypothetical 10 percent decrease  in interest rates, and amounts to approximately $4.0 million.  The fair value of the Company’s long-term debt was estimated  using discounted future cash flows based on the Company’s  incremental borrowing rates for similar types of borrowing  arrangements. The Company measures its market risk exposure on its  grain futures contracts using a sensitivity analysis, which  considers a hypothetical 10 percent change in the market  prices for grain. A 10 percent decrease in the market price  for grain would have negatively impacted the fair value of the  Company’s October 26, 2014, open grain contracts by $7.1  million, which in turn would lower the Company’s future cost  on purchased grain by a similar amount. open contracts are reported at their fair value with an unre- alized loss of ($11.3) million, before tax, on the Consolidated  Statements of Financial Position as of October 26, 2014,  compared to an unrealized loss of $(6.3) million, before tax, as  of October 27, 2013.