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WhatWood Global Trends Review Global Trends Review, January 27 – February 09, 2014: OSB demand booming in UK, but probably at risk in Central Europe

Global Trends Review, January 27 – February 09, 2014: OSB demand booming in UK, but probably at risk in Central Europe

12 February 2014 ` 02:59  

Canadian Norbord company is going to expand its Inverness OSB mill in UK in order to meet an anticipated 50% increase in OSB consumption during the next decade, TTJ reported. Earlier the company completed a detailed feasibility study into upgrading the current 25-year-old facility to include a new continuous press and environmental control technologies.

WhatWood’s reviews are prepared using corporate press releases, Holzkurier, Timber Trades Journal, Fordaq, EUWID Wood Products, ITTO, ForestTalk, and EUWID Paper.

Norbord senior vice-president and chief financial officer Robin Lampard told TTJ that every mill in the European OSB industry was running at near capacity and market prospects were improving. Norbord’s European operations recorded an 8% rise in OSB prices in 2013, with its mills operating at 95% capacity.

Earlier Egger reported that it was going to focus more on OSB sales in UK, as timber frame market situation was improving substantially in the country. Also, Coillte was going to invest into additional continuous press in Ireland at its SmartPly OSB factory.

Meanwhile, Pöyry Management Consulting has issued a warning about the additional panel capacity planned by the European wood panel industry, questioning whether it is being built in the right place, at the right time or even to produce the right products. The company says this will lead to declining prices for some panels and markets but rising prices for others. Whilst the planned new investments all make economic sense individually, their overall impact will be to reduce industry profitability.

The particleboard and OSB production in Central Europe are at most risk, while MDF investment plans are more in line with demand. In line with standard scenario, Pöyry predicts a 3% rise in European panel demand per year. By 2020, Eastern Europe will consume 55% of European wood-based panels, compared to 49% presently. The continued expansion of the bioenergy sector is another potential threat to the European panel industry.


Germany produced 2.25 million tonnes of wood pellets in 2013, which is 2.2% higher than in 2012. A 15% increase was registered in pellet boilers installation, up to 43,000 units, as German Energy Wood and Pellet Association (DEPV) reported. A year ago, pellet production increment was much more dynamic (17%). For 2014, DEPV forecasts a 4% increase in domestic pellet production up to 2.35 million tonnes.

Average price was 15.7% over 2012, partially caused by a difficult supply of sawdust necessary for production. Presently, there are about 60 pellet plants in the country which are possible to produce 3.2 million tonnes at maximum.

Neova AB, a subsidiary of the Swedish Vapo Group, and Lantmännen, one of the largest groups in agriculture, machinery, energy and food in the Nordic region, are merging their respective wood pellets activities, Fordaq reported. The new company will include Neova’s pellets activities in Sweden and the corresponding Lantmännen Agroenergi businesses in Sweden and Latvia. The merged company will have an annual turnover of around €113 million. The new company will become the market leader in Sweden and a strong competitor in the Baltic region. The merger will create synergetic effects, including optimized logistics.

Metsä Fibre increased the price of Botnia Nordic Pine (Northern Bleached Softwood Kraft) in Europe, effective 1 February 2014, up to $930 per tonne (from $900 per tonne), CIF Metsä Fibre’s frequently used European ports of destination. As well as other major European producers, Metsä Fibre gradually increased the price for NBSK in recent months by $70 per tonne, due to strong market improvement.

The export of logs is a problem throughout Europe, as said by Lars Schmidt, CEO of DeSH (Association of the German sawmill and wood industry), in an interview to Holzkurier. “It started with beech. In the future, China’s appetite for wood could well jeopardize our softwood supply chain. The softwood log demand in Asia is rising extremely. We are looking for solutions in Brussels to regulate the export in terms of local value added”, Schmidt told.

Stora Enso reported that its timber division EBITDA for the fourth quarter of 2013 nearly doubled to €30 million. Full-year deliveries amounted to 4.77 million m3, up slightly on 2012, while sales also increased to €1.86 billion. Stora Enso said slightly lower sales prices were more than offset by lower log prices in the Nordic countries, higher by-product income in Central Europe, lower fixed costs and higher volumes in all businesses. Demand in the fourth quarter was described as significantly stronger than a year earlier.

Finland’s first CLT-line will start up in the summer of 2014. Around €2 million will be invested into a 10,000 m3 production line with a further possible increase to 30,000 m3, Holzkurier said quoting Finnish business journal Maaseudun Tulevaisuus. The sawn timber for the production will be obtained from the local Kuhmo Oy sawmill. As is common with large-format panels, production will be strictly to orders. Mill owner Juha Virta sees potential for his product in school building projects. Currently, cross-laminated timber is not produced in Finland. Stora Enso supplies the Scandinavian region with products from its Austrian mills.

The duty-free quota for softwood plywood imports into the EU is being filled much faster than in years past in 2014, according to EUWID. By 30 January, 417,189 m3 of the 650,000 m3 quota was left, so 36% of the whole-year quota was already used in the first month of the year.

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