A significant rise in prices for particleboards is being observed in Russia

Russian retail prices for particleboards began to rise in November 2020. In Moscow, the price for particleboards of the most popular thickness among furniture makers – 16 mm – rose by 40% YoY to 13,578 rub. per m³ (net of VAT). According to WhatWood’s monthly pricing bulletin Russian Market of Wood-Based Panels, prices for boards rose by 51% YoY compared to the previous month.

In the Volga region, the rise in prices for particleboards in November 2020 was 91% YoY to 12,833 rub. per m³ (net of VAT). In comparison with October, boards rose in price by 29%.

Prices for laminated particleboard show less active growth: in November 2020, they increased by 17% YoY and by 3% compared to October (the figures are valid for Moscow). In the Volga region, the rise was 14% YoY and 9% MoM.

This rise in prices, according to the analysts of WhatWood, is due to a raw material shortage being experienced by board producers because of the belated winter. Producers also reacted to the high demand from furniture companies (i.e. the deferred demand in the furniture market occurred due to the restrictive measures during the pandemic) by having jacked up prices for particleboards, fiberboards, and fasteners.

The situation with a serious rise in prices for particleboards (the most common material for the production of furniture in Russia) is being observed amid disappointing forecasts of the Association of Furniture and Woodworking Enterprises of Russia about a significant decrease in sales of Russian furniture according to the results of the year.

Alexander Shestakov, President of the Association, noted that the profit margin in the industry will decrease to 1% this year given the fact that the furniture production costs have increased by 20-25% over the past half a year. This can lead to the closure of small and medium-sized furniture companies, and the Association is already observing this tendency. The Association is also of the opinion that the furniture industry is now on the brink of survival.