Plywood prices soar
The Plant Engineering Construction and Repair price index rose 2.6% between May 1998 and May 1999. Meanwhile, the Plant Engineering Cost Index (right) for these same industries fell 1.7% over the same time period. These numbers mean that, in general, plant managers will find room to negotiate for lower prices. Industries with falling or stable cost trends and those with A or A+ margin grades will be the best bet.
By Staff -- Plant Engineering, 8/1/1999
Plant engineers looking for ways to score points in their construction budgets might want to take another look at plywood costs. In the 12-mo ending May 1999, the average price of softwood plywood rose 8.9%. Factory managers and plywood buyers of all sorts were hit with a whopping 7% hike in prices from April to May alone. But the cost to manufacture plywood fell 0.2% from May to June. As a result, the average plywood manufacturer scored $4.70 in added profits for every $100 worth of product sold. That's why the softwood plywood industry earned an "A" margin grade.Factory managers would do well to investigate savage price hikes in mineral wool and gypsum products too. On the other hand, manufacturers of flat glass and structural clay products have been hit hard on the bottom line recently. Suppliers of these products will be resistant to requests for price cuts.
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