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WhatWood Global Trends Review Global Trends Review, September 16-22, 2013: trend to local sales in woodworking; pulp & paper equipment makers cut jobs

Global Trends Review, September 16-22, 2013: trend to local sales in woodworking; pulp & paper equipment makers cut jobs

25 September 2013 ` 05:25  

In 2013, the output of the eight largest European softwood lumber producers is expected to increase by about 1.8 million to 100 million m3, as reported by Holzkurier journal quoting the Association of the Austrian Wood Industry. Production in Germany will rise from 20 to 21 million m3. The outlook is positive also for Finland where the output will grow from 9.3 to 9.5 million m3. In contrast, the output in Austria follows a slight downtrend: here the softwood lumber production will decrease from 8.9 to 8.6 million m3. The same trend applies to Sweden where mills are expected to produce a total of 15.3 million m3 – down from 15.8 million m3 in 2012.

As chairman of the Association of sawmill and wood industry of Baden-Württemberg (Germany) Wilhelm Schilling supposes, regionalism will gain significance with a natural product such as wood. Baden-Württemberg’s initiative “Wood from here” is an approach of “clearly pointing out the origin of wood”, he said. To serve this purpose, the association has found a feasible instrument of verification across all wood products. “This should be an incentive to customers to buy wood locally”, Schilling believes. In Switzerland, customers pay 2 to 3% more for wood carrying a sign of origin. This means that it is accepted.

“We need to utilize the potential within 700 km of where we are located”, said Georg Binder, head of proHolz Austria industry association. “In the region of greater Vienna, three million people need affordable housing. Spain, China, the Balkans – this is where we have cancelled promotional activities.” Binder noted that Switzerland shows a good example what to do in multi-storey housing: “An efficient flow of processes have led to a boom there. In Austria, multi-storey timber buildings represent a market share of just 2%.”

Meanwhile, Germany’s second largest construction company Bilfinger SE is going to reduce its administrative workforce by 1,250 people in 2014-2015. According to austerity programme, by 2015 personnel costs will be cut almost twice.

Construction volume in the European Union rose by 0.7% in July compared to June, according to Eurostat data. In four member states, production declined, with the biggest loss registered in Sweden (–4.1%), while nine countries reported positive development, Romania being the leader with 8.6%.

The Portuguese wood materials manufacturer Sonae Indústria announced in a press release that its indirectly affiliated companies GHP GmbH and Tool GmbH plan to reduce particleboard production at the Glunz AG mill in Germany. Sonae pointed out the continuing losses of the site, due to lower demand for particleboard and generally high production capacity of the industry.

Pulp & paper equipment makers have to cut jobs

Metso’s Pulp, Paper and Power segment will reduce workforce in Finland by 660 jobs. The reduction will take place through redundancies, retirement options and terminations of temporary contracts. Internal transfers will take place too. In addition to personnel reductions, temporary layoffs might also be possible if required by the company’s workload or financial situation.

Another pulp & paper equipment producer, Voith Paper, also decided to cut jobs in Germany and Austria. Despite the adjustments in capacity, the existing competence centres will remain at the respective locations and will save their specialization. “This cut is bitter and painful. However, after careful consideration, it is unavoidable in order to align our capacities in Europe to the changed demand. This is a prerequisite to stay profitable and competitive under the changed market conditions,” says Dr. Hans-Peter Sollinger, CEO at Voith Paper.

Voith Paper also noted that there is a weakening economic situation in the global paper market that is more severe than expected. In particular, the Chinese market is growing noticeably more slowly than predicted by market analysts in the past year. This concerns all paper grades except tissue. In the coming years, demand in China will be mostly oriented to compact, locally produced machines of medium size – a trend that is further intensifying and to which Voith Paper has already reacted with specific restructurings.

On the bright side, as Wood Resource Quarterly reported, chip and pulplog prices in the second quarter of 2013 fell in many global regions. This, along with strengthening US dollar, allowed many pulpmills to increase their profitability. The Hardwood Wood Fiber Price Index (HFPI) reached $100.46 in the second quarter, which is 3.1% lower than in the first quarter. The biggest price declines compared to Q1 have occurred in France, Japan, Australia, Russia and Germany. The Softwood Wood Fiber Price Index (SFPI) was also down in the 2Q/13 to $97.75, 2.2% lower than in 1Q/13, with the biggest price reductions seen in Norway, Japan, France and Australia. Higher market pulp prices and lower wood fibre costs in 2Q indicates improved profitability in the sector, WRQ says.

The wood costs as a percentage of market pulp prices are also falling for several quarters in a row. The most dramatic decline has been for Eucalyptus pulp, from 36% to 24.4% within two quarters. The decline in the softwood kraft pulp sector has not been so dramatic.

Sonoco Alcore will increase the price of coreboard and uncoated recycled board in Europe by €50, effective October 1, 2013. “We have absorbed higher energy, freight and other material prices throughout 2013 and the current market conditions are such that we must finally increase prices,” said Phil Woolley, company’s CEO.


According to information from the Holzleimbau study group in Wuppertal, the preliminary version of the harmonised European product standard for cross-laminated timber (CLT) has been sent in for the so-called “postal ballot before formal vote” under the standard number prEN 16351:2011. Once the postal ballot has been concluded successfully and the draft standard accepted by the CEN (European standardization committee) consultant, the actual formal vote is then held in which the only options are acceptance or rejection. As far as the study group knows, the formal vote was to take place at the beginning of autumn this year. This would make acceptance of the standard possible before the end of this year.

As compared to August, pellet retail prices in Switzerland increased in September by 1.4% to approximately €325 per tonne. Compared to the same month last year, the price is higher by 7.5%. Wood pellet costs for consumers in Germany are also slightly higher than in the previous month. According to the index of the German Energy Wood and Pellet Association (DEPV), the average price for a quantity delivered of 6 tonnes is €277.67/tonne in September. This means a 1.3% increase over August and 19.3% year-on-year.

In the first half-year, only Russia and Finland managed to increase hardwood plywood deliveries to UK (by 6% and 9.5% respectively). At the same time, Chinese and Malaysian volumes were down by 6% and 7% respectively, as ITTO reported.

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

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