Slower demand and high timber prices have compelled plywood producers in Haryana and Punjab to cut the production during September. More than two dozens of plywood manufacturing units have shut down their operation, whereas numbers of manufacturing establishments are compelled to run their units in one shift or 8 hours. New plywood units have temporarily halted their operation and rented/ leased units are stopped their production.
The industry blames the slower demand and tight payment flow along with high price of timber and other raw materials. A Yamunanagar based producer says that situation is of panic now, because their input cost is increasing every day and they are not in a position to absorb this cost in present scenario, hence it is better to cut down production with immediate affect.
Rising Poplar log prices has created havoc in plywood industry, and everyone has started analyzing their input cost and profit margins with increasing cost of core veneers. Producers are calculating the manufacturing input cost against selling price of finished goods and have decided to reduce production volume. The increasing prices of Phenol, Formalin, Face Veneer etc have added another burden on producers. A Punjab based producer says that he expects immediate price increase of finished goods to maintain present profit margin although the slower demand is another worry for him.