WhatWood Agency has completed an update to its annual survey Russian OSB market in 2019-2020

Russian OSB market is quite young. The first imported products appeared in the late 1990s. In the period from 1997 to 2014 OSB demand has doubled annually (largely due to the low base effect). Until 2012 there was no own production in Russia, and demand was fully satisfied through imports, and the peak of foreign supplies was reached in 2013 – 695 thousand m³ worth $ 216 million. The situation on the Russian OSB market began to change radically in the second half of  2014.

It can be stated that the process of OSB import substitution in Russia has been completed. If we neglect the volumes of Kronospan Mogilev, located in a single customs and economic geographic zone with Russian plants, then the share of imported OSB on the domestic market in 2018-2019 is accounted for about 1.5% of the total consumption – the absolute minimum for the entire period of  these products sale in Russia.

In addition, we can note the finally formed trend – the launch of low-capacity plants. The history of Russian OSB industry began in 2012 with a low-capacity plant (Hillman, Vladimir region). Launching of “Zhunda” and “DNS Les” (Far East), “Uralsky OSB Plant” (Perm Territory) increased production capacity in Russia by 150 thousand m³/ year,  by the end of 2020, it is planned to launch a plant in the Perm Territory (“Rozas” LLC) with a capacity of 15 thousand m³ per year. Thus, the total production capacity of OSB plants in Russia has already reached 2.315 million m³ per year.

The challenge brought by the new 2020 worsened the consumption situation, at least in the first half of the year. In April 2020, the increased intensity of  COVID-19 spread had a significant impact on the reduction of domestic consumption, including a decrease in real estate sales and a slowdown in construction. IHS Markit PMI, which controls overall market conditions for process industry in Russia, plunged from 47.5 in March to 31.3 in April, indicating the most significant decline in business conditions across the manufacturing sector since September 1997.

Russian OSB producers face the challenge of at least maintaining the positions achieved in 2019. Obviously, they will have to compete for both their consumers and those of plywood. OSB’s position as a plywood substitute product in the construction segment was steadily strengthening in 2018-2019: plywood and OSB consumption volume in the domestic market on average equaled. The companies have so far only planned to laminate OSB, it is possible that the market situation can push players to take more active steps in the development of their product portfolio and expanding OSB scope of application.

Read detailed information in the annual review OSB market in Russia 2019-2020.