Hundreds of new units and presses in North India and another hundreds are planning to expand after easing up in law by central government for setting up new wood based manufacturing unit in “Haryana, Punjab, UP, Rajasthan etc” is certainly going to create a survival crisis for those who are entering in unplanned way. 3000 cbm a day capacity in MDF & Particle Boards manufacturing are also announced or in a way to begin production is adding to the timber requirement which looks already suffocated.
We have seen the situation happened with Baggase based Particle Board Industry in Gujarat, which was almost shut down due to non-availability of raw material since 75 days. You can easily calculate the cost of investment for setting up a particle board manufacturing unit and the loss a producer have had incurred due to the shut down period. Such losses might not be compensated to the company even if they run smoothly for next three hundred days.
The situation emerged because the capacity expansion in particle board sector in Gujarat happened without calculation of sustainable procurement of raw material; resultantly the entire industry was forced to face the challenge. The alert for the possibility of similar scenario was being presented by THE PLY REPORTER through its articles, editorials and news in every issue since January 2017. Now it is almost a clear sign that shortage of timber will be looming over plywood and panel industry for next two years. The size of capacity expansion reported is very much alarming for entire sector vis a vis the handiness of timber supply for smooth running units.
Hundreds of new units and presses in North India and another hundreds are planning to expand after easing up in law by central government for setting up new wood based manufacturing unit in “Haryana, Punjab, UP, Rajasthan etc” is certainly going to create a survival crisis for those who are entering in unplanned way. 3000 cbm a day capacity in MDF & Particle Boards manufacturing are also announced or in a way to begin production is adding to the timber requirement which looks already suffocated. But what seems to be true is Industry and related people are highly unaware about the availability of timber and demand-supply scenario of plywood markets. What seems true is that ‘everyone is unaware or they might be ignoring the real fact because they are only concerned for business expansion and volumes without realising that timber crisis might derail their plans.
The real fact is timber plantation dropped drastically and merely 30 percent of plantation has happened every year during last 4 years compared to 2012 season. BSMR study hints that “present plantation situation would not suffice even half of the capacity of wood panel industries by year 2019-2020. Certainly the prices will go up and margins will reduce hence start making a collective (Industry-Farmer- Government) effort from today for improving timber situation for 2022 rather expanding production capacity.
This November issue publishes featured bundle of industry-market information, which would be helpful for your trade and business. The worth reading interaction with Mr. Jaydeep Chitlangia, Managing Director of Sarda Plywood on the eve of the celebration of successful 60 years of his company has been featured. The news on markets, impacts of highlighter business and views of industry and trade people on present business apart from detailed coverage and report of recently held exhibitions at Mumbai and much more briefs have been presented. The Ply Reporter once again requests you to keep reading and follow us on web for knowledge and tips for the wood panel trade business.
Rajiv Parashar
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