Looking for best way to set up NIGP codes?

Looking for best practice on setting up NIGP codes for public sector entity. Goal is to be able to do reporting against the NIGP codes for purchased items and to provide common grouping for inventory items. Was wondering if they should be set up as item categories, purchasing categories, or as customer item commodity codes. I see in Inventory module under setup, there is a commodities menu which takes me to the HTML side of the app and looks like this is for purchasing. Can this be used? Can anyone recommend a best practice? Thank you.