Hike in timber prices may impact real estate industry

Timber prices in the international market have increased, which will impact the real estate industry, where processed wood is used as a building material. Timber prices have increased owing to the increased demand in China and the USA, as well as the hike in freight charges. Domestic timber producers have now decided to pass on the price rise to the consumers, which will shift furniture and packaging material prices up by almost 20% to 25%. According to the industry professionals, the cost of raw materials including teakwood, hardwood, and pinewood increased in the international market, making timber products costly. Gandhidham and Kandla are the biggest timber producers in the country. Approximately 70% of timber imported by India comes by Deendayal Port in Kandla and Mundra. The industry employs one lakh people, of which 70% are migrant labourers. Hikes in timber prices will also influence the real estate industry, where process wood is used as a building material. President of the Kandla timber association, Navneet Gujjar, told the media that the industry was recovering from the Covid effect, the new hike in prices will impact demand in the market. Hardwood is used in making furniture, and teak in making doors and windows, and pine in packaging material. The plywood and timber processed are used in the real estate industry, particleboard, toys, furniture, veneer, and other sectors. The industry annually imports 40 lakh cubic meters of timber, costing almost Rs 7,000 crore. According to industrial sources, the recovery of economic activity accelerated the demand for timber in China, Europe, and the USA increasing prices of raw materials. Freight charges all over the world increased by 20% to 25%, which got accented by a shortage of containers. Image Source Also read: Century Plyboards aims Rs 650 cr capex