Govt vows not to curb investment in MDF

Govt vows not to curb investment in MDF

JAKARTA (JP): The government will not limit investment in the
nation's medium-density fiberboard (MDF) industry despite the
market glut, a minister has said.

Minister of Forestry Djamaludin Suryohadikusumo said Friday an
oversupply of the MDF wood products was normal.

"The MDF market, like that of pulp, fluctuates every two to
three years," Djamaludin was quoted as saying by Bisnis Indonesia
daily. "I am optimistic that it will get better in two to three
years."

Oversupply of the MDF products reached a total of 1.3 million
cubic meters last year.

The minister said investors knew more about the current
situation of the market and would not risk investments in the
sector.

Companies must obtain permits from the government before they
can build or expand an MDF plant, he added.

Meanwhile, the chairman of the Association of Indonesian Wood
Panel Producer, A. Tjipto Wignjoprajitno, said prospects for MDF
remained promising despite the market glut.

Many furniture-makers had turned to the MDF for wood panels to
substitute for plywood.

However, he said that using MDF instead of plywood would not
threaten the plywood industry, as fiberboard could not completely
replace all elements of plywood usage.

Each wood panel type had its own market segment, he said.
Customers from the middle to lower economic segment preferred
cheaper wood panels such as MDF, particle board and block board,
he said. (das)