INVENTORIES

Inventories consist of:



	September 30, 2016			December 31, 2015
Leaf tobacco	$	45,564		$	49,856
Other raw materials	4,150			3,578
Work-in-process	422			789
Finished goods	65,200			61,493
E-Cigarettes	66			80
Inventories at current cost	115,402			115,796
LIFO adjustments	(27,780		)	(29,280		)
	$	87,622		$	86,516

All of the Company's inventories at September 30, 2016 and December 31, 2015 are reported under the LIFO method. The $27,780 LIFO adjustment as of September 30, 2016 decreases the current cost of inventories by $18,363 for Leaf tobacco, $643 for Other raw materials, $33 for Work-in-process, $8,736 for Finished goods and $5 for E-Cigarettes. The $29,280 LIFO adjustment as of December 31, 2015 decreased the current cost of inventories by $19,863 for Leaf tobacco, $643 for Other raw materials, $33 for Work-in-Process, $8,736 for Finished goods and $5 for E-Cigarettes.

Liggett enters into purchase commitments with third party providers for leaf tobacco that will be used entirely for future production. The future quantities of leaf tobacco and prices are established at the date of the commitments. At September 30, 2016, Liggett had tobacco purchase commitments of approximately $16,906. Liggett has a single source supply agreement for reduced ignition propensity cigarette paper through 2019.

Each period, the Company capitalizes in inventory that portion of its MSA liability that relates to cigarettes shipped to public warehouses but not sold. The amount of capitalized MSA cost in “Finished goods” inventory was $16,428 and $15,796 at September 30, 2016 and December 31, 2015, respectively. Federal excise tax in inventory was $26,531 and $23,455 at September 30, 2016 and December 31, 2015.