Demand and Sentiments Improve, Market Smiles

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After a slowdown patch of 3-4 months, the demand for wood panel and surface décor products is noted to have improved in September and October months. The market sources say that the demand and sentiment were drastically affected from April to August 2019 and lifting of materials were reported to drop below 50 percent. The mid and small plywood segments located in Punjab, Haryana, UP were affected more due to the slowdown in demand. The heavy rain and floods during the monsoon period had also affected the demand of wood panel products.

The sign of improvement in demand has given relief to manufacturers, distributors and retailers. Due to this the payment flow is also reported to get better, which was the biggest road block for the sustainability of entire ply-lam industry and trade. Small and mid segment producers have got more relief due to the improving market sentiment, and their capacity utilisation is also registered to recover in October as compared to the last 4 months, although due to festive season during Deepawali, the lifting of materials was noted to be slow. Market sources say that workmen and carpenters went to their native places during festive time, hence the present slowdown will sustain for a week, and demand will be better in November – December.

The better demand scenario has brought happiness to the small and unorganised segment enterprises because they were hit hard due to the slow payment situation. It is noted that the branded segments were not much affected due to slowdown in demand, although their profit margins had shrunk marginally but they were maintaining their sales tally. But the present improving sentiment might help them to improve their margins, and their profit as the 3rd quarter sales might get better.

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