I have recently returned from a visit to one of my favourite destinations, China, and was impressed yet again by the ‘can-do’, positive philosophy of the Chinese people.
In what other country would they open up a bank on a Saturday afternoon to retrieve your credit card after it had been eaten by the ATM machine outside? How many stewardesses would run all the way to baggage reclaim just to return a paperback book stupidly left on the plane?
The panel makers are as aware as anybody of the global economic crisis and the effect it is having – and will continue to have – on their businesses, but they maintain a positive outward appearance.
I visited six MDF/HDF factories (and two machinery manufacturers) and none of them were visibly downbeat about the prospects. They claimed they could sell all their panel production, although they did admit that the price was very low.
Commonsense says this was not true – export markets for both furniture made from their panels, and the panels themselves, have virtually dried up and there is far too much production to be absorbed on the domestic market, which is also suffering.
Perhaps they just follow the optimistic lead of the Chinese government, which is still talking about growth this year exceeding 8%, while the IMF predicts little over 6%. The government is no doubt pinning its hopes on its massive financial stimulus package. However, it is a country of around 1.3 billion people and that is a massive market that will not lie dormant for ever.
There is general agreement that MDF production capacity in China is now in excess of demand and that there will be few new mills built, so at least two experienced panel manufacturers are talking seriously about their plans to make OSB and tap into a new market – even though that market is yet to be created.
Maybe one man’s positive attitude is another’s foolish optimism. Or maybe China will lead the way out of this recession. As you will see in our news pages, however, Brazil is – also optimistically – forging ahead with new production lines.
As I write, there is certainly no sign of the ‘green shoots of recovery’. There are plenty of predictions about when the recession will end, but those predictions are made on the basis of no previous knowledge of this kind of economic downturn.
But there will be a recovery some time and with it a return to importance of environmental concerns. Then wood products will be in a strong position, as John Wadsworth points out (p22).
