In a note to investors, analyst Jonathan Feeney noted hog prices have increased 54 per cent since August lows and are up 15 per cent since Hormel last reported earnings, according to Meatingplace.com.

"While Hormel's balanced and diversified portfolio has a number of moving parts that respond differently to inflationary pressures, the effect of such a substantial input cost moving this far and this fast is overwhelming, and raises the risk of Q1 and/or F10 guidance missing expectations," he wrote.

Mr Feeney lowered his fiscal 2010 first-quarter earnings forecast to 62 cents per share from 63 cents per share; lowered the fiscal 2010 full year forecast to $2.42 from $2.52; and lowered the fiscal 2011 forecast to $2.55 from $2.67.

Mr Feeney said he expects Hormel's pork business margins to suffer and reduced his fiscal 2010 refrigerated margin assumptions to 5.4 per cent from 6.6 per cent, but noted that is still ahead of the 5.2 per cent historical average.

Turkey fundamentals should continue to firm with margin improvement at Jennie-O, he said, reflecting some lagged benefit from the flow-through of lower-priced corn and tighter industry levels of commodity meat.

Hormel is set to issue its next quarterly earnings report on 18 February.