Inventories

3 Months Ended

Mar. 31, 2018

INVENTORIES

Inventories consist of:



	March 31, 2018			December 31, 2017
Leaf tobacco	$	44,177		$	45,801
Other raw materials	3,508			3,272
Work-in-process	551			358
Finished goods	65,953			63,363
Inventories at current cost	114,189			112,794
LIFO adjustments	(23,004		)	(23,004		)
	$	91,185		$	89,790

All of the Company’s inventories at March 31, 2018 and December 31, 2017 are reported under the LIFO method. The $23,004 LIFO adjustment as of March 31, 2018 decreases the current cost of inventories by $16,442 for Leaf tobacco, $123 for Other raw materials, $18 for Work-in-process and $6,421 for Finished goods. The $23,004 LIFO adjustment as of December 31, 2017 decreased the current cost of inventories by $16,442 for Leaf tobacco, $123 for Other raw materials, $18 for Work-in-process and $6,421 for Finished goods.

Liggett enters into purchase commitments with third-party providers for leaf tobacco. The future quantities of leaf tobacco and prices are established at the date of the commitments. At March 31, 2018, Liggett had tobacco purchase commitments of approximately $5,175. Liggett has a single source supply agreement for reduced ignition propensity cigarette paper through 2019.

Each period, the Company capitalizes in inventory the 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 $17,587 and $17,440 at March 31, 2018 and December 31, 2017, respectively. Federal excise tax in inventory was $26,356 and $25,151 at March 31, 2018 and December 31, 2017, respectively.