Inventories

Inventories at December 31, 2013 and December 31, 2012 were comprised of:



	December 31,			December 31,
(in thousands)	2013			2012
Finished products	$	21,887		$	19,596
In-process	9,840			8,344
Raw materials	15,246			14,130
Fine and fabricated precious metals in various stages of completion	19,802			9,599
	66,775			51,669
LIFO reserve	(1,025		)	(4,139		)
	$	65,750		$	47,530

In order to produce certain of its products, H&H purchases, maintains and utilizes precious metal inventory. H&H records certain of its precious metal inventory at the lower of LIFO cost or market, with any adjustments recorded through cost of goods sold. The market value of the precious metal inventory exceeded LIFO cost by $1.0 million as of December 31, 2013 and $4.1 million as of December 31, 2012. The Company recorded non-cash LIFO liquidation gains of $0.6 million and $1.9 million in 2012 and 2011, respectively. No similar gain was recorded in 2013 due to an increase in ending precious metal inventory stated at LIFO cost. The increase in the amount of precious metal inventory from December 31, 2012 was principally attributable to the acquisition of Wolverine Joining (see Note 4 - "Acquisitions"), whose precious metal inventory is accounted for at fair value.

Certain customers and suppliers of H&H choose to do business on a "pool" basis and furnish precious metal to H&H for return in fabricated form or for purchase from or return to the supplier. When the customer metal is returned in fabricated form, the customer is charged a fabrication charge. The value of this customer metal is not included in the Company's consolidated balance sheet. To the extent H&H is able to utilize customer precious metal in its production processes, such customer metal replaces the need for H&H to purchase its own inventory. As of December 31, 2013, H&H's customer metal consisted of 247,103 ounces of silver, 576 ounces of gold and 1,392 ounces of palladium.



Supplemental inventory information:	December 31,		December 31,
(in thousands, except per ounce)	2013		2012
Precious metals stated at LIFO cost	$	5,090	$	5,460
Precious metals stated under non-LIFO cost methods, primarily at fair value	$	13,687	$	—
Market value per ounce:
Silver	$	19.49	$	30.20
Gold	$	1,201.50	$	1,675.40
Palladium	$	711.00	$	702.85