India’s plywood industry at risk due to log supply shortage

3 November 2014

Plywood manufacturers in India are facing huge difficulties in securing logs to maintain production. Recently log imports from Sarawak have increased and this has eased the situation but the steadily rising prices for Sarawak logs are undermining the profitability of Indian plymills.

Plywood manufacturers in India are accustomed to using tropical hardwoods for face and core veneers and, until the log export ban by Myanmar, relied heavily on imports of gurjan.

Temperate hardwood logs such as beech and poplar have found a market in India as has eucalyptus from South America. Other sources of hardwood raw materials being tapped by Indian plymills include Papua New Guinea, Solomon Islands, Vietnam, Cambodia, Liberia and Cameroon.

Average landed prices for logs from PNG and Solomon Islands were US$300-320 per m3. Okoume logs were landed at US$470-480 per m3 but, despite the higher price, the yield of veneer from okoume logs is high and compensates for the higher price.

The Indian Federation of Plywood and Panel Industries has said survival of the industry is at risk as log supplies become harder to secure and more expensive to import.