Our reports on the particleboard industry in Europe and North America have made fairly depressing reading since 2008, with the industry in both regions being badly hit by the global recession. This is not surprising when the customer base is almost totally in construction and furniture manufacture. However, since our report last year, on the industry in 2011, things have changed for the better.

North America has shown increasingly strong signs of economic recovery and this has been reflected in the fortunes of the panel industry. The better news, as one might expect, first appeared in the OSB sector as housebuilding picked up and this obviously has a knock-on effect on the MDF and particleboard sectors.

Meanwhile, eastern Europe, and notably Russia, has a raft of new-build projects, both under way now and planned for the next three to four years.

On the downside, there are still a number closures to report since last year, chiefly in western Europe.

There are also a number of ownership changes to mention on both continents.

Europe overall

The annual report of the European Panel Federation (EPF), which says it represents 95% of European particleboard producers, was launched by its president Ladislaus Döry at its annual meeting in Dublin, Eire, in July this year (see full report on p12) and set the scene for this continent:

"Capacity utilisation rates in the EU27 stood at only 78% in quarter 2, 2013 and producers need around 85% to start making money," said the president. "Meanwhile, construction confidence is not only not improving but turning downwards and on the Order Books Indicator, only Croatia is showing a real increase.

"Last year was not as expected and for 2013, forecasts are being constantly adapted and it is still challenging. ‘Cautious optimism’ is the phrase, but there is no real optimism and in my opinion, there may be one more year before we start any recovery."

The president reported that particleboard production capacity was down by 1% in 2012 and the EPF estimates a further 1% decrease for 2013.

"In 2012, there were plant stoppages or closures in Bulgaria, Italy, Spain, Sweden and the UK and one capacity expansion, in France, while for 2013, there were stoppages/closures in Greece, Norway and Spain and capacity expansions planned in south eastern EU." Particleboard production fell 5% in 2012 over 2011 but is estimated by the EPF to increase by 1.5% in 2013.

The EPF forecast an increase in particleboard production for its members in 2013 to 29,087,000m3 (2012: 28,654,000m3) and for the EU27 28,262,000m3 (2012: 27,856,000m3).

"The expectations for the year 2013 are rather positive," said Mr Döry. "Only Belgium expects a decrease in particleboard production, by around 5%. Most of the European countries forecast a stabilisation, or a moderate increase by up to 5% of their outputs. Norway and Romania even project larger increases. The rise in production in the EU-EFTA area as a whole is estimated at +1.5% for 2013."

According to the Federation’s figures, Germany accounted for 20% of particleboard production in 2012, France 13%, Poland 10% and Italy 9%. The UK accounted for 6%, while Spain and Belgium were at 5%; Romania and the Czech Republic 4%; Slovakia, Portugal and Sweden all 2%. "Others" accounted jointly for 12%.

Real consumption in 2012 was given as 26,882,000m3 in total.

The EPF Annual Report 2013 goes on to say: "In 2012, downward variations of national particleboard productions were larger than the less numerous upward variations: Countries such as Finland, the United Kingdom, Norway, Spain and Portugal suffered from larger falls in output.

"For Finland, Spain and the United Kingdom, these decreases were the result of reductions in their production capacity. Italy and Estonia also experienced significant decreases in capacity and production, while an important fall in production was once again observed in Greece.

"Countries such as Sweden and Romania, on the other hand, experienced significant increases in output which can be explained by a rise in production capacity for the latter".

In other news for Europe, in Belgium, Mohawk completed its acquisition of Spano in the first quarter of 2013. In 2012, Spano generated estimated sales of €183m. The total value of the acquisition was €125m in cash. In commenting on the closing, Jeffrey S Lorberbaum, Mohawk’s chairman and ceo, stated: "The combination of Unilin and Spano will deliver greater value for our customers and expand our product offering."

This acquisition adds Spano to panel maker Unilin, which Mohawk already owned. In Finland, the Puhos mill, which was closed in September 2011, has been removed from our listing of mills operating in 2012. In Germany, we have removed Pfleiderer’s Rheda mill, which we believe to have been closed.

Similarly, we have removed Interspan of Hungary from the listings for 2012 as it closed during 2011. Italy give Trombini in frossasco finally closed its Siempelkamp ContiRoll line in October 2012, removing 300,000m3 of capacity from next year’s list as it was still ‘open’ for most of 2012. As mentioned in last year’s report, IBL closed in June 2011 and has thus been removed from the listings for 2012 (90,000m3/yr). Panguaneta of Sabbioneta also closed its small, 25,000m3/yr line in March 2012. Again as reported in last year’s survey, Reni Ettore closed in June 2011 (20,000m3/yr) and, as expected, Montanari of Villarotta closed its doors in 2012 (70,000m3/yr). We have removed all these from the main listings for 2012. We have also removed the Massoni mill in Stradella (20,000m3/yr) as we believe that is also closed, as well as Sipav of Vinovo (200,000m3/yr).

That is a total of 725,000m3 removed from our total for Italy during 2011/12.

In Norway, we have been listing the Midt Troms mill in Trefordling but we can find no evidence that it is still in existence and have thus removed its 50,000m3 from our listing. In Poland, we have removed Lenwitt of Witaszyce (100,000m3/yr) and ZPW (230,000m3/yr), believing both to be closed. However, for Poland we have added Baltic Board PPB Gryfbet Ltd as it is listed by the EPF as running. We have not been able to obtain the capacity information for this mill, however.

In Portugal, we have removed Jomar of Matosinhos, believing it to have closed some years ago (340,000m3/yr).

For Romania, we have added the new line for Kastamonu Romania AD, at Reghin (540,000m3/yr), which was shown in Table 7 last year as anticipated new capacity and is now in production, as kindly advised by the company.

Spain also has two closures to report: Finsa Mugica’s ContiRoll line is closed (270,000m3/yr) and Sonae (Tafisa)’s Solsona mill is also closed, as kindly reported by Sonae (325,000m3/yr).

Meanwhile, Interbon in Burgos has been bought by Kronospan, who we reported last year had an interest in the mill. We believe that mill to have three lines, with a combined capacity of 643,000m3/yr.

In Turkey, Orma’s new line at Isparta is now in the main listings with its 450,000m3/yr (shown in Table 7, 2012).

There are two changes to report in the UK. One is the final closure of the ‘Challenger’ plant at Knowsley near Liverpool. It was opened by HRH the Duke of Edinburgh in 2000 as a state-of-the-art continuous Dieffenbacher line but after a series of tragic accidents and fatalities on the site, it finally succumbed to protests of the local community about ‘pollution’ etc – and presumably to the long-standing negative attitude of the ‘workers’ of Liverpool towards paid employment, which goes back decades. That removes 450,000m3 of capacity from the UK in the main listings for 2012 as the line had been inactive for some time.

The second change in the UK is that we have belatedly removed the single-opening Siempelkamp line at Egger’s Hexham factory (180,000m3/yr), which was replaced by the new Siempelkamp ContiRoll line of 650,000m3 annual capacity in 2007.

New capacity in Europe

There is only one ‘new’ project in western Europe to report and that is the Dieffenbacher CPS line for Pfleiderer at Neumarkt, Germany, replacing two multi-daylight lines. Planned capacity is 350,000m3 /yr, with construction beginning in the second half of 2012 and production in early 2014. We mentioned this project in last year’s report, but had reservations about it going ahead. However, it is now confirmed and in the EU 15 Future Capacity changes, Table 6.

The other planned mills in Table 6, in France (Linex and Swedspan) and Sweden (Swedspan), have been carried forward from last year’s report as they were expected to come onstream during 2013 and thus to move into the main listings in next year’s report.

Turning eastwards, we have already mentioned the new line for Kastamonu in Romania (480,000m3/yr), which is up and running, and it is eastern European countries, and particularly Russia, that are ‘providing the action’ for this year’s survey, as readers can see from Table 7.

In Belarus, VMG Mogilev appeared in last year’s Table 7 and is still there, for 2012 startup, although we have not been able to ascertain whether it has yet started production.

Ivatsevichdrev in Belarus has moved from Table 7 into the main listing of operating mills in 2012.

Kronospan is also building a new mill, at Smorgon in the Grodno region of Belarus, with 340,000m3/yr, expected to start in September 2014. This has moved back from the 2013 start-up date of which we were advised last year.

The other mills shown in Table 7, 2012, in Bulgaria and Latvia, for start-up in 2012, remain in Table 7 of this 2013 survey of 2012, because they were not in full production in 2012.