New pressure treated is wet, maybe 40%-50% moisture, wood need below 15%
to varnish. It can take months to dry, the only way to know is buy a
moisture meter. Varnish is not for pressure treated, stain is. Cracking
is normal for pressure treated, but your plywood was a mistake as its
interior grade im sure. Wait till its dry and stain it, forget the
varnish.