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WhatWood Global Trends Review Global Trends Review, September 30 – October 06, 2013: particleboard capacity in Central Europe to fall by 1 million m3; OSB and pellet industries to fight for raw wood

Global Trends Review, September 30 – October 06, 2013: particleboard capacity in Central Europe to fall by 1 million m3; OSB and pellet industries to fight for raw wood

8 October 2013 ` 19:53  

Glulam production costs in Central Europe as of September 2013 stand at €411/m3, according to Timber-online, website run by Holzkurier journal. Price for glulam-lamellae ranges from €209 to €213/m3. To have them dried down brings the costs to at least €220/m3. The whole price model is available at the Timber-online website.

Annual Central European particleboard capacity will likely fall by a total of 1.075 million m3 due to a number of factors: the fire at Depalor, divestments at Spano Group after integration into Unilin and particleboard production stoppage at Sonae Industria’s mill in Horn-Bad Meinberg. Central European particleboard industry insiders also feel that additional shutdowns are possible amid on-going surplus capacity, weakening sales markets and the resulting competition and pressure on margins. However, this contrasts with the coming start-up of new machinery by Pfleiderer and Swedspan as well as the allegedly soon restart of Kronospan’s particleboard mill in Bischweier, EUWID says.

Meanwhile, logging in Central Europe tends to shift eastwards, as WRQ publication reported quoting UNECE. Annual harvests in “Central West” region (Austria, Germany, Italy and Switzerland) in 2008-2012 fell by 15% compared to 2003-2007, while in the “Central East” region (Bosnia & Herzegovina, Croatia, Czech Republic, Hungary, Poland, Serbia, Slovakia and Slovenia) it increased by 4% and exceeded “Central West” in volumes. The biggest change occurred in Germany, which traditionally had been a net exporter of logs, but became a net importer in 2009. During the first five months of 2013, Germany was a net importer of 2 million m3 of softwood logs, which can be compared to net exportation of 1.6 million m3 just five years ago.

As WhatWood already reported in one of the past Global Trends Reviews, Austrian and German companies found new source of raw timber in Czech Republic. As WRQ says, growing demand for wood from the East has led to price hikes. In the nineties, average sawlog prices in the Czech Republic were approximately 60% of the German prices, while during the past few years this level has reached 80%.

OSB and pellet industries to fight for raw wood

A new study by market information provider RISI said additional OSB capacity in the US will come from mills being re-opened, the expansion of current sites and from new mills. It said 4.5 billion ft2 (418 million m2) in additional capacity is expected to come on line next year. As senior economist for wood products David Fortin says, this can have its effect on the pellet market. “The US pellet export market is developing at the same time that OSB production is ratcheting up and will have implications for wood fibre demand and ultimately prices.” A similar warning was put forward by the panel industry in the UK as government considered support tariffs for biomass power stations. This puts under question the previous trend: raw material shortage drove European companies to invest into American facilities. German Pellets said in a report that US plants will allow the company to become independent of fluctuations in the availability of raw materials in Europe and related price adjustments.

BlueFire Renewables, Inc. has integrated a synergistic wood pellet production plant to its facility in Fulton, Mississippi. The reconfigured design will be a 9 million gallon per year (34,000 m3) ethanol plant integrated with a 400,000 tonne per year wood pellet plant. The pellets will be sold under long term contracts to Europe.


Baltic sawmills intend to take advantage of brisk business and shortfalls in supply to raise prices by €5/m3, but some shippers have talked about a premium of €10/m3, as said by TTJ quoting EUWID. Demand is at unusually high levels due to a good backlog of orders from a construction season extended by good weather while output is at maximum. Cuts in sawmill capacity in Sweden and good demand from the UK is also driving the market. “Suppliers are saying the mark-ups are due to a good backlog of orders from European, North African and Asian buyers reaching into the fourth quarter,” said EUWID. “Some companies’ entire output planned until the end of the year is already under contract.”

In August 2013, wood products exports from Brazil fell 4.6% compared to values in August last year, which is from $213.2 million to $203.4 million, ITTO reported. Pine sawnwood exports increased 8.9% in value in August 2013, from $13.5 million to $14.7 million. In terms of volume, exports rose 5.5%, from 61,300 cubic metres to 64,700 cubic metres. Pine plywood exports expanded 8.6% in value in August 2013 compared to August 2012, from $30.4 million to $33 million. In terms of volume, exports increased 11.4% from 82,200 cubic metres to 91,600 cubic metres. At the same time wooden furniture exports dropped from $47.7 million in August 2012 to $41.4 million in August 2013, which represents a 13.2% decline.

July saw 330,000 m3 of European softwood lumber arrive on Japanese shores, up by 43.9% year-on-year and 11.5% more than the previous month. As the Japan Lumber Journal reported, imports that month increased especially from Finland (+72.2% to 112,000 m3) and from Austria (+49.9% to 38,172 m3). In the glulam sector, European imports to Japan rose by 16.3% in July. Austria was able to achieve a 20.8% surplus to 20,405 m3, thus regaining the rank as number one supplier from Finland which posted a slight loss of –3.6% to 18,496 m3. Autumn demand in Japan is expected to push lumber and glulam imports even further. Latest figures show a 9% increase of Japanese housing starts to 84,300 units in August on-year. Both lumber and laminated timber prices maintained their high levels in July which were 40.9% and 38.6% higher than a year ago. For both products, the Austrians achieved the highest prices: for softwood lumber, they averaged at JPY 41,023/m3 (€310/m3, about 20% more than Finnish suppliers) and for laminated timber at JPY 56,103/m3 (€424/m3, about 0.7% more than Finnish suppliers). Monthly average Japanese imported lumber prices for different species and importing countries are available in WhatWood Weekly, while the general picture is given in our infographics.

Official statistics from the Chinese customs show an 11.34% increase in log imports in the first six months of 2013, over the same period of 2012, Fordaq reported with a link to Overall, China imported 25 million m3 of logs in the first half-year at a value of $5 billion. In the following years, Chinese demand for logs and softwood timber is expected to further rise and by 2015, the Chinese State Bureau of Forestry estimates a 50% increase of wood supply deficit.

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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