When a furnace is stocked with items (eg. iron ore and coal), another hopper set up to pull out of the furnace removes first the 'cooking' (eg. iron ore) item. When all 'cooking' items have been removed either by the hopper or by a player, it moves on to the 'fuel' (eg. coal) items. When all 'fuel' items have been removed, either by the hopper or by a player, it moves on to the 'cooked' item (eg. iron ingots). This may be a feature, but it makes creation of an automated smelting system very difficult.

Steps to duplicate:
1) Set up a furnace with a hopper drawing items into a chest below. (Setup pictures attached)
2) Insert any amount of 'smeltable' material and any amount of fuel into the top hopper.