Earnings reports of manufacturers, trading firms, and distributors of building products were unprecedentedly bad in the first half of 2009. After the second half started in October, each company is maintaining a cautious attitude as recovery in demand is still unforeseeable.

Although domestic softwood plywood manufacturers are keeping the system (production curtailment) to recover product prices, those prices are leveling off due to the supply-demand imbalance. There is a concern among general distributors regarding increasing difference between the prices, at which leading housing manufactures or major precut factories purchase directly from makers and general market prices.

The industry was shocked at the news released at the end of September that housing starts in August were less than the 60,000 unit mark. If total housing starts of this fiscal year would be 800,000 units, plywood supply needs to be smaller than 62% of the fiscal 2006 level (1,290,000 units) to keep the supply and demand balance. Manufacturers have to continue the output cut system.

In producing centers of imported plywood, each factory began to make it clear 'which items they are going to produce', as logs are scarce. They have shifted the destinations of their products to the Middle East, Korea, US, and Australia from Japan where the quantity and the prices don't expand; and at the same time, they are increasing the volume of planted trees as the material.