Growing Poplar timber prices have been worrying plywood industry in northern India, but the easing up prices of Eucalyptus timber is helping industry to sustain. Industry believes that Poplar timber prices have been tending upward since April this year and it has so far noted an increased up to 25- 30 percent during last six months. It is believed that industry is unable to pass their input cost in the market in this ratio and they are forced to note big pressure on their margins.
The growing Poplar timber prices and other raw material costs had compelled Yamunanagar and Punjab based plywood industry to reduce their production significantly. Most of the units were reported to run only day shift who were earlier operating on 18 hours and Plus schedule. Many rented plywood units faced closure, new units delayed their commencement date and many new press orders were halted/cancelled temporarily suggest reports. Though, the recent easing up in eucalyptus prices has offered a breather to plywood industry for the time being.
In past months, the pressure led to demand for increase in plywood prices by 6 to 10 percent is now low because timber price has offered scope to back down. It is known that the association of manufacturers in different states called urgent meetings and decided to increase the prices from 5 to 7 percent with immediate effect to match the timber price with cost. The manufacturers were reported to struggle in market because demand is less, payment is tight, hence it was difficult for them to pass the increase prices of finished products in market. Easing prices of eucalyptus timber have offered relief to plywood industry in North India also following this, many manufacturers are shifting their focus on ‘Alternate Plywood’ from ‘All Poplar Ply’. Many rented factories are resuming their production although the rent cost has reduced.