The sharp jump in prices of formaldehyde and phenol created chaos in wood panel and laminate industry during December and January. Thankfully a little comfort with softening of prices has offered a sign of relief to plywood, film faced ply and laminates manufacturers. The prices of phenol and methanol had impacted every category of plywood panel and decorative surfacing producers though a further improve in raw material supply indicates a breathing space on chemical front.
The last week of January month has brought some relief to the industry with the reports of improving supply of methanol and has led to stabilizing the price. Chemical suppliers feel that formaldehyde prices will soften gradually, and it may ease up a little by next month. The chemical experts say that once demand in China consolidate, followed by increase in supply and stocks at Indian ports the bubble will settle down for methanol and phenol.
Experts said that chemical prices jumped to those high levels because of lower stocks at Indian ports, on the other hand high demand in China led to short supply. It is seen that Phenol, Methanol and Melamine prices move with world market demand-supply scenario and there is no choice for manufacturers other than passing the cost to customers.
Reports indicated the lower prices of phenol and methanol up to 10 to 15 % in last week of January and it will soften further due to increase in supply. High price of chemicals and other raw materials are forced to further increase the prices but the recent indication of stagnancy in price rise will give relief to industry.