To add to the woes of the plywood industry, re-constituted boards such as MDF, HDF, WPC (wood plastic combination) boards and particleboards are increasingly replacing plywood.

Rising costs and competition with substitutes are eating up profitability in the plywood sector. Competition in the wood based panel sector is shifting in favour of the composite boards as prices are very competitive and the quality of the panels now available is so much better than in the past because of improved manufacturing technologies.

The reconstituted panel manufacturers have moved downstream and are now laminating panels within their own plants thus cutting out intermediary companies which previously handled the lamination.