Inventories

9 Months Ended

Sep. 30, 2017

Note 5 - Inventories

The components of inventories at September 30, 2017 and December 31, 2016 were as follows:



	September 30, 2017			December 31, 2016
Manufacturing supplies	$	29.5		$	28.2
Raw materials	85.7			54.9
Work in process	238.4			182.9
Finished products	367.4			308.8
Subtotal	$	721.0		$	574.8
Allowance for obsolete and surplus inventory	(33.5		)	(21.1		)
Total Inventories, net	$	687.5		$	553.7

Inventories are valued at the lower of cost or market, with approximately 55% valued by the first-in, first-out ("FIFO") method and the remaining 45% valued by the last-in, first-out ("LIFO") method. The majority of the Company's domestic inventories are valued by the LIFO method and all of the Company's international (outside the United States) inventories are valued by the FIFO method.

An actual valuation of the inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time. Accordingly, interim LIFO calculations must be based on management’s estimates of expected year-end inventory levels and costs. Because these calculations are subject to many factors beyond management’s control, annual results may differ from interim results as they are subject to the final year-end LIFO inventory valuation.

The LIFO reserves at September 30, 2017 and December 31, 2016 were $167.4 million and $179.5 million, respectively. The Company recognized a decrease in its LIFO reserve of $12.1 million during the first nine months of 2017, compared with a decrease in its LIFO reserve of $0.2 million during the first nine months of 2016.