Logs to logarithms

Some suppliers and customers are more of a match than others and Danzer and Audi are among them.

While ‘Vorsprung durch Technik’ – advance through technology – may be the German car giant’s slogan, it is also a mantra at the Austrian-based international decorative hardwood specialist.

One illustration is the latest fascia product Danzer supplies to the car maker; a variant of its Vinterio engineered veneer. Vinterio II blends dark poplar with aluminium, creating a futuristic meld of wood and metal designed to be processed on conventional equipment.

Globally, the company embraces the whole supply chain; from forestry, sawmilling and lumber sales, to veneer and other speciality surfaces manufacture. But throughout, said chief executive Hans-Joachim Danzer in an interview appropriately convened in London’s ultra high tech Shard building, there’s a focus on how new technologies can enhance product and business.

"Timber isn’t generally seen as technically advanced. But R&D is part of our DNA. It helps us make more of the resource, develop better products and increase applications for wood," he said.

Also underpinning Danzer’s technical capabilities is more than 80 years’ experience in the veneer and wider timber sector.

The company traces its roots to 1932, when the current ceo’s grandfather, Karl Danzer, moved from Germany to the then veneer trade capital, Paris, to become a broker, picking up French from schoolbooks.

Having established his name, he returned to Germany to develop a veneer manufacturing operation. Then, through the following decades, the model for today’s business emerged, albeit constantly evolved since; a global network of forestry and logging operations, sawmills and veneer factories, timber and veneer sales offices.

The company’s technical focus is also long-established. Back in 1983 it pooled expertise with engineers Babcock to develop the first upstroke slicer.

This breakthrough then prompted it to refine the process further and ultimately develop the equally ground-breaking VS4000.

"The VS4000’s key advance is cut precision," said Mr Danzer. "It gives improved productivity and consistency and less waste."

Another factor in its long-term global success, Danzer maintains, is continuing diversity. While other timber businesses may have narrowed their focus, it has maintained its forest-to-veneer factory perspective.

Employing 2,500 people, the company today has two sawmills (one in the US, one in Congo Brazzaville), two US veneer plants (one each in France and the Czech Republic), plus speciality production in Germany. It also owns 48,000 acres of hardwood forest across Pennsylvania, New York and Indiana and manages 1.16 million ha of concessions through Congo Brazzaville subsidiary, IFO. In addition there are procurement operations sourcing logs and lumber worldwide for Danzer’s own facilities and customers, plus a 21-strong network of sales offices, selling 200 timber species in various forms in 80 countries. The latter, of course, include Danzer UK, headed by managing director Ken Walsh.

Overall group turnover breaks down to around 43% lumber, 38% veneer and the balance in speciality products, services and log sales.

"Maintaining this range of activities gives us an understanding of the entire value chain," said Mr Walsh. "It also makes us adaptable to market and consumer trends."

This flexibility has really come into its own recently, he added, as Danzer faced both seismic change in the veneer sector and global recession.

The veneer industry first came under pressure from synthetic substitutes and a decline in the use of wood in interiors. This, plus the economic crisis, saw European production fall from 1 billion m2 in 2000 to 300 million m2 today; and the number of mills from 98 to 30. North America experienced similar contraction.

Danzer also shed four plants but, said Mr Danzer, its operational range did provide the market insulation its competitors lacked.

What also helped it through the downturn, and to emerge more strongly when economic recovery set in (and Danzer’s annual veneer output could still circle the earth in a band a metre wide), was continuing product development.

"We never cut R&D spending," said Mr Danzer. "We knew we had to continue to improve performance, widen choice, open new markets and create products to compete with synthetics."

Among the launches was Vinterio, introduced in 2007 from Danzer’s Czech Republic Melnik facility, which comprises laminated lengths of green lumber, processed like a veneer log.

"Vinterio retains real wood’s grain and colour depth, but provides a more homogenous surface for greater repeatability," said Mr Danzer. "It now sells in 22 countries."

Demand is also rising for 2012 launch Linea, comprising laminated layers of veneer sliced perpendicular to the surface for a ‘rift cut’ appearance.

"Because it’s engineered, it’s uniform, and can also be supplied in lengths up to 3.6m," said Mr Danzer.

Another development, which Danzer goes as far as saying is changing perceptions of veneer, is its 3D range.

Invented by Dresden manufacturer Reholz, which Danzer acquired in 2008, this has the plasticity to cope with virtually any angle or curve without cracking. It comprises layers of precisely aligned 1.2mm hardwood veneer strips, which can be bonded and pressed to shape.

3D is ‘several times more expensive’ than standard veneer but, says Danzer, opens up whole new aesthetic and manufacturing possibilities. And such is demand, it has tripled capacity.

It was just as these new products and economic recovery were bedding in that the other recent big news story involving Danzer broke; its 2013 disassociation by the Forest Stewardship Council (FSC).

It was a controversial episode, following clashes between residents and authorities in concessions operated by SIFORCO, the Democratic Republic of Congo subsidiary Danzer sold in 2012. The FSC judged the company had breached its ‘conflict resolution’ requirements, leading to it being barred from supplying FSC-certified products worldwide.

"It was very disappointing as corporate social responsibility (CSR) and environmental performance are central for us," said Mr Danzer. "We were pioneers in tropical forest legality verification and certification, and IFO’s concessions are the biggest continuous certified forests in Africa.

"We’re also committed to social development and welfare. My grandfather built houses for Danzer’s African employees, drilled wells and provided health care before FSC or Greenpeace existed."

Although it diverted significant resources, Danzer did not hesitate in setting out to win its certification back. It recruited consultancy Swisspeace to revise conflict resolution policy and launched a global CSR review, while continuing to observe FSC principles and criteria. The result was a group re-association last August, with IFO’s concessions successfully re-audited in November.

"It wasn’t a process we would have wished to go through, but ultimately we’re proud of how the whole Danzer team responded – and that we were re-associated inside 14 months," said Mr Walsh.

"It’s also encouraging that customers we lost because they require FSC have since returned," said Mr Danzer.

Following its re-association, Mr Walsh also commented that Danzer would be able to re-target resources back to business development. That is clearly now happening.

To bring even greater focus to R&D, it is being concentrated with IT and engineering in Dresden – and as part of its corporate overhaul, Danzer is also transplanting its HQ from Switzerland to Austria.

It has also developed the first Environmental Product Declarations (EPDs) for veneer – with Health Product Declarations to follow – and is further stepping up new product development.

The latter includes large-dimension FSC ekki from IFO and innovative sliced flooring lamellae from Melnik.

The former follows IFO’s installation of a heavy-duty mill line for ‘waterproof’ species, with the capacity to handle 12m logs.

The sliced lamellae were first unveiled in 2012 and Danzer is already doubling capacity.

"The technical advance is in the slicing," said Mr Danzer. "Rather than a conventional pressure bar to push wood to blade, we’ve developed a floating system. The result is less heat and distortion, a high quality surface, and 35% less waste than sawing."

Pushing timber processing even further into the 21st century, Danzer is also introducing scanners to optimise log processing. The €3m machines spin three times per second around the log, generating a 3D internal picture to guide end-use selection and maximise yield. Even Audi would be impressed.

Upbeat Danzer UK aims for innovation and diversity
Danzer UK was launched in 1978 and today accounts for 15% of group turnover.

"That makes us Danzer’s second largest market after the US," said managing director Ken Walsh.

Mr Walsh himself came on board 27 years ago.

"And lumber director Mike Evans and added value products director James Angel joined in 1995," said Mr Walsh. "So we have good longevity, expertise and experience in our management."

The business, which employs 12, holds £5-6 million of stock. This comprises hardwood lumber from the US and Europe, Asia and Africa (with the latter including laminated scantlings) plus flooring, kitchen worktops, stair parts, doors and speciality veneer.
According to Mr Walsh, business recently has been buoyant .

"And looking ahead we’re anticipating stability," he said. "At the same time we’ll continue to innovate and diversify our range, while focusing on enhancing our ability to meet just in time requirements, communicating global influences that affect the UK market and promoting legal, sustainable timber."