Poplar timber prices are hovering at Rs 1000 a ton, severely impacting plywood, particle board and MDF manufacturing cost. But the plywood industries are most affected because core veneers are largely obtained from comparatively better girth logs or log stems that are above 16 inches. The price in over sized and good quality logs have risen sharply which is becoming unviable for plywood producers on current selling prices. Hence a chunk of plywood producers in Uttar Pradesh, Haryana and Punjab have shifted to Eucalyptus Core Veneers but the increasing demand of Eucalyptus is pushing its prices forward. Evidently the growing demand of Eucalyptus would lead to further price rise in core veneer, hence a chunk of plywood producers have begun exploring the alternate options for their core veneer requirements.
Plywood producers have explored the cost of Eucalyptus Core Veneers from Vietnam at Kandla, which is now almost near to the cost of bringing core from UP area to this region. Timber industry traders from Vietnam confirms about the queries from plywood producers every day on which they feel that within a month or two or once market demand revives, veneer import will be just a matter of time. The current rates, payment terms and shipment durations are still not favoring the Indian plywood manufacturers but sooner it will start fitting the economics, said a trader operating in Vietnam.
Besides, plywood producers located in port regions are exploring opportunity to import Poplar logs from Belgium, Germany and other parts of Europe. According to traders of timber and supplies, the imported logs will be higher girth offering high quality and better yield hence sooner quality conscious buyer shall purchase logs from there once Indian poplar remain above 100 mark all the time. The next four years are going to be good time for imported veneer and logs in poplar and eucalyptus segment. It is noted that import of Eucalyptus Core Veneers from Vietnam and Poplar logs from Europe is not new for Indian companies. During 2011-13, when the timber prices shot to peak, many manufacturers were using imported core Veneers and logs and it was significant.