plywood Harley Davidson Firmer prices bode well for timber sector
- Interest in timber companies is starting to improve as plywood prices are on the rise again
- According to Credit Suisse, plywood prices have bottomed out and are beginning to pick up, and this could trigger a sector re-rating
- Export prices of plywood had gained about 2-5% lately
- Last year, the problem stemmed from a new Japanese legislation which slowed down building and construction approvals
- Plywood imports in Japan dipped as much as 18%
- But things are said to be looking brighter now; HK listed Samling's Lingui stands to be the main beneficiary as it has a large concession of 1.4mil ha locally
- Tiong Hiew King's Jaya Tiasa has 713,000ha concessionaire; Ta Ann has 440,000ha; WTK has 372,000ha
- Credit Suisse also upgraded its call on Ta Ann from neutral to outperform (its palm oil division will also benefit from high CPO prices)
- Some Japanese property analysts expect a housing recovery in 2008, which would fuel a recovery in plywood prices
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