Inventories

Inventories consist of the following (in millions):



	December 31, 2012			December 31, 2011
Inventories at FIFO, net of reserves	$	456.7		$	440.3
Less: LIFO reserve	(90.3		)	(78.0		)
Total inventories at LIFO, net of reserves	$	366.4		$	362.3

Cost of goods sold reflects the application of the last-in, first-out (“LIFO”) method of valuing inventories in the U.S. based upon estimated annual producer price indices. Inventories in Canada are valued on a first-in, first-out (“FIFO”) basis, as LIFO is not a permitted inventory valuation method in Canada. During periods of rising prices, the LIFO method of costing inventories generally results in higher current costs being charged against income while lower costs are retained in inventories. Conversely, during periods of decreasing prices, the LIFO method of costing inventories generally results in lower current costs being charged against income and higher stated inventories. If the FIFO method had been used for valuing inventories in the U.S., inventories would have been approximately $90.3 million higher at December 31, 2012, compared to $78.0 million higher at December 31, 2011. We recorded LIFO expense of $12.3 million, $18.3 million and $16.6 million for the years ended December 31, 2012, 2011 and 2010, respectively.