The cost analysis of China Fiberboard

With the development of the industry, raw material for producing MDF is less, even exhausted, especially in east and north China. Some MDF factories had to stop production or produce on short time. Price of raw material of MDF in Guangxi province rose from 180-220 RMB Yuan per ton in 2004 to 220-240 in 2005 and then to 280-300 in Oct. 2006, up almost 40% in the two years. Price of formaldehyde, which is the most important glue in producing MDF, increased from 1500 RMB Yuan per ton in 2004 to 1750 in 2005 and then to 2400-2600 in Oct. 2006, up 60-70%. Plus more expensive water, electricity, fuel and freight, cost of producing MDF is higher and profit is less. As demand for MDF is so large, we believe price of MDF will be definitely improved.