Question-and-Answer Session
Operator
(Operator Instructions) And we'll go first to George Staphos, Banc of America.
George Staphos - Banc of America Securities - Merrill Lynch
Hi everyone, good morning.
Anthony Allott
Good morning George.
George Staphos - Banc of America Securities - Merrill Lynch
Congratulations on the year.
Anthony Allott
Thank you.
George Staphos - Banc of America Securities - Merrill Lynch
First question, can you give us a bit more basics on what was happening with food can margin in the fourth quarter? And if you were seeing increased demand, why were you shipping out of inventory? Why wouldn't you have just produced more, which would have absorbed more of that fixed cost? And I had a couple of follow ons.
Adam Greenlee
Hey, good morning George, it's Adam. You are right, we did see relatively strong revenue in the fourth quarter from the food can business. And that growth was primarily driven by unit volume in the food can business of an increase of just over 6% versus the prior year. At the same time, to your point, we were pulling back on production at year end because we had not seen the significant volume increases prior to that point in December. So we were pulling back on our production volumes, which, the increased sales drove more overheads through to the P&L. And in fact, we saw about a $20 million decrease in finished goods inventory for the food can business. In addition to that, we also saw further inflation in tin plate costs for 2008 that we recognized in the fourth quarter.
So really, this is a timing issue. The increased sales volumes, not only do they come in the fourth quarter, they came in truly in December.
George Staphos - Banc of America Securities - Merrill Lynch
Okay. And I am just a little curious with the raw material cost pressure that you sighted, why wouldn't that have normally been just captured in your normal pass through? I mean you are setting your selling prices relative to your steel costs. Is it just a function of perhaps you had bought some metal at a higher price planning for 2009? Obviously, tin plate prices are going up, but your selling prices hadn't yet adjusted for the fourth quarter volume?
Adam Greenlee
Well I think what happened as you look at our tin plate costs for 2008, number one, our costs came in essentially where we expected them to over the course of the year. So, again, there is a timing issue versus the full year and what we traditionally true up in the fourth quarter, both with our suppliers and our customers from a tin plate costing standpoint.
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