Inventory costs are tracked on a lot-identified basis and are included as cost of revenues when sold. Inventories are stated at the lower of cost or net realizable value. The Company makes adjustments to inventory when conditions indicate that the net realizable value may be less than cost due to physical deterioration, obsolescence, changes in price levels, or other factors. Additional adjustments to inventory are made for excess and slow-moving inventory on hand that is not expected to be sold within a reasonable timeframe to reduce the carrying amount to its estimated net realizable value. The write-downs to inventory are included in cost of revenues and are based upon estimates about future demand from the Company’s customers and distributors and market conditions. The Company recorded a write-down of $169,000 and $192,000 related to packaging materials and hemp seed during the three and six months ended June 30, 2023, respectively. The Company recorded write-downs of wheat, hemp seed, CBD oil and body care inventories of $1.1 million and $1.5 million during the three and six months ended June 30, 2022, respectively. If there are significant changes in demand and market conditions, substantial future write-downs of inventory may be required, which would materially increase the Company’s expenses in the period the write down is taken and materially affect the Company’s operating results.

Inventories, net consist of the following (in thousands):


	June 30, 2023		December 31, 2022
Raw materials	$	647	$	610
Goods in process		88		—
Finished goods		3,726		2,728
Inventories	$	4,461	$	3,338