In May, the GTI-Woodbased Panel (GTI-WBP) Index registered 42.6%, and was below the critical value (50%) for 2 consecutive months, indicating that in the pilot countries, the business prosperity of wood-based panel industry represented by the index shrank from last month. The positive sign was that the downward trend on the demand side was slowing down.

On the demand side, although there had been a decline in the overall volume of orders for the wood-based panel industry in the pilot countries, the downward trend of new orders, export orders, and existing orders were all slowing down, with corresponding indexes of 40.4%, 44.9% and 44.1% respectively. Besides, most Indonesian GTI-WBP enterprises reported an increase in overseas orders when compared to the previous month.

On the supply side, the production index registered 40.8% in the contraction range, indicating that the overall production volume of wood-based panel in the pilot countries decreased from the previous month. Production activities reduced in most pilot countries (such as Brazil and Indonesia) due to frequent rains. The inventory index of finished products registered 48.5% (below the critical value), indicating that the industry was in the stage of "destocking". Additionally, considering the slowdown of contraction in order performance, the relationship between supply and demand had shown signs of improvement.

From a price perspective, the purchase price index for raw materials registered 51.2%, still in the expansion range of more than 50%, indicating a rise in raw material costs and growing cost pressures for wood-based panel enterprises.

From the perspective of market developments: at the beginning of 2024, there were 58 particleboard production lines in China under construction, with a total annual production capacity of 20.06 million cubic meters, and industry insiders expect that the new production capacity will be about 15 million cubic meters in 2024, and by the end of 2024, China's annual particleboard production capacity will exceed 66 million cubic meters. Recently, an official said that the export value of Sarawak's timber and timber products in 2023 was RM3.14 billion, a year-on-year decrease of 20%, and the drop was largely due to the reduction in the export of plywood. In April, Brazil's tropical plywood exports were 2,600 cubic meters in volume and US$1.5 million in value, respectively down 13.0% and 12.0% year-on-year.

GTI-Woodbased Panel (GTI-WBP) Report - May 2024.pdf