The bull run in prices of each of the raw materials for Laminate e.g Kraft Paper, Melamine, Formaldehyde, Phenol etc have forced manufacturing units to curtail the production of its low margin products. The biggest hit is noted on Liner Laminates production, that has beenimpacted greatly during September and October months.Majority of the companies have firmly stopped production due to steep cost escalation of raw materials. Be it big volume producers or mid-sized companies, every one of them have reduced the liner production by 70 to 80 percent that has choked the liner supply all of sudden.
The big Laminates manufacturing houses confirmed that decision to opt out from liner production is not a permanent one but, there is huge capital required to buy raw materials in present time, and their allocation of funds will be first to design and range-based laminates production. The big volume producers like Stylam, Virgo, Durian, Globe etc have cut down the liner supplies and are catering in limited manner to only those who are either their regular range buyers or they are paying the todays price and instant payments. Even the top brands who also supply balancing sheets to project have increased the prices and tightened the supply.
Industry reports that India produces approximately 15 million Liner laminates sheets every month, which is now hardly total to 8 Mn during September. Markets are presently buying liner laminates in tune to 400 per sheets. Many companies feel that the investment of manufacturers has been increased much higher due to high prices of raw materials, hence they have decided to produce those materials, which they would receive better realisation because they feel that Liner laminate is less margin product, and such investment is not feasible in present time
The dropping manufacturing of Liner Grade Laminate would be a biggest challenge for industry because this product has contributed a major role in growth of Indian Decorative laminate Industry. It is also said that some big manufacturing houses and many small size laminates units are heavily dependent on Liner laminates manufacturing but such a spike in raw materials prices have created a chaos like situation for the entire industry and trade.