Capacity still growing as Algeria joins the club

MDF capacity continues to increase, though with not quite the same momentum, notably in the Indian subcontinent, South American and Asian regions. Following on from Part 1, covering Europe and North America, we now focus on the existing MDF mills in the ‘rest of the world’ as at the end of 2017 and on those under construction in 2018, or planned for 2019 and beyond.

For these ‘rest of the world’ areas, after a number of updated and corrected data inputs, we now show an increase in installed capacity in 2017 to 69,973,000 m3, while further investments identified for 2018 and beyond bring the anticipated total up to 74,462,000m3.

So, for 2018/19 and beyond, when this figure is added to the European future capacity of 28,856,000m3 and the North American figures (including Mexico) of 6,336,000m3 for the same period, we see global MDF capacity exceeding the predicted figure from last years’ survey, growing to 109,654,000m3.

This year’s survey again provides complete listings of capacity in the various regions as at the end of 2017, plus the growth expected during 2018, 2019 and beyond.

The tables show that the increases in 2017 are accounted for mainly by Brazil, China, Iran and Vietnam; and for 2018 and beyond, Brazil, Paraguay, India and Thailand.

China And North East Asia

Over the past five years, average annual growth has been strong, except for Japan, where GDP growth declined, but is now recovering more strongly. In China, GDP growth averaged more than 6%, but is slowing slightly and has been just over 3% in South Korea. Projections are still for strong GDP growth across the three countries to 2019, with considerably stronger growth (2.1%) in Japan and in South Korea (3.6%), offsetting still strong, but somewhat less buoyant, growth in China (6%).

China and North-East Asia’s MDF markets continued to under-perform in 2017, due to the slowdown in global demand, and prices remained relatively weak as a consequence, aided further by a cooling Chinese economy and depreciating currencies across Asian countries against the US dollar.

However, China is still forecast to produce 85% of the furniture in North Asia by 2018/19 and the relatively strong growth in the region will influence not only the consumption of all wood panels, but also the proportion of use by each sector.

Approximately 30% of the annual production of furniture in China is exported, with the largest volumes destined for the US, Japan and Europe, while the domestic market continues to grow. As reported last year, some furniture factories have had to close due to raw material shortages, labour issues, higher wages and dwindling exports, and this continues. The drive by the authorities to move industries to inner cities also led to a relocation of some Taiwanese furniture factories from China to Vietnam.

MDF production capacity in China has grown rapidly, as we have seen, over the past five years, with capacity increasing dramatically to 44,910,000m3 at the end of 2017. Based on current, announced and assumed expansion plans, production in China is projected to increase only very slightly over the next two years.

In China, where consumption has previously increased so strongly, forecasts are for it to increase at an average annual rate of just 1% over the two years to 2018/19, as China shifts to a focus on more domestic consumption growth consumption, possibly at the expense of some exports.

In the last 12 months, from what we have seen, real commercial activity in the Chinese MDF industry has continued to slow as the government tries to rein in the country’s dramatic economic growth of recent years. However, despite this, we can report that the new investment we highlighted last year, by the Chinese Yekalon-Jiufngyuan Panels Inc, to expand MDF/HDF production, with the help of Siempelkamp, has started production, so has been moved to the main listing. The company plans annual capacity of 250,000m³ of MDF/HDF after start-up, which was in the summer of 2017.

New investments recently announced in China include a THDF plant producing ultrathin boards, primarily for use by furniture makers. It will be built by Dieffenbacher for Guangxi Lelin Forestry Development Co Ltd by June 2019, near Nanning in Guangxi province. Eucalyptus will be utilised.

Also, Chinese panel manufacturer Chiping Senqiang MDF, in Chiping in Shandong Province, has ordered an EVO-56 refiner from Valmet Oyj, which has the potential to achieve an extra 300,000m3 at the plant. We also have learnt of two more new MDF projects in China for Dieffenbacher – one by Hubei Hongyi in Xiaogan and the other by Liuzhou Sanyi in Liuzhou. Volumes of both mills and more details are to be advised, but these have been added to our ‘new investments’ listing for 2018/19.

With the difficulty in obtaining totally accurate information on all Chinese capacity, including all the small mills and the very large scale of MDF production, WBPI continues to have to make some informed assumptions.

For South Korea’s listings, some very helpful input again this year has come from the Korean Wood Panels Association, which has reviewed and updated our information, and this is reflected in our main listing.

SOUTH EAST ASIA

These economies are still set to be among the world’s fastest-growing out to 2018/19. The five countries – India, Indonesia, Malaysia, Thailand and Vietnam – are still expected to have an average real GDP growth rate of 4-5% pa, or even higher.

The following factors will support stronger residential construction activity over the medium term, which in turn will be a positive driver, leading to more demand for MDF: Economic development will strengthen household income, which will support residential construction. Urbanisation will generate demand for dwellings in the major cities. Improved transport links will support the establishment of new or enlarged urban centres. An existing shortage of housing should help buttress residential construction. A gradually growing middle class should continue to support a trend to improved housing quality.

In this part of Asia, the MDF market has been doing well. Prices continue to edge up from a stable base, driven recently by increasing demand, rising adhesive prices and some shortages of wood.

In Vietnam, the MDF industry has fared better than some other countries, due to more foreign direct investment and strong exports to the US. The existing large VRG Dongwha joint-venture mill is running well in Binh Phuoc province and a second production line has been ordered from Siempelkamp, with a capacity of 198,000m3 added to the main listing. Vietnam-based Thien Lam Dat JSC and Dieffenbacher sealed the deal last year for a complete MDF plant in Bac Giang, about 50km east of Hanoi. Planned capacity is 200,000m3 but at the time of writing, the line is still under construction. The wood raw material will come from Thien Lam Dat’s plantations and will be mostly acacia wood. Start-up is planned for late-2018.

In Thailand, with over 3,759,000m3 of MDF produced annually, furniture manufacturer Kijchai, with its 300,000m3 MDF plant continues to run well, as does the second major new MDF line in the region, built by Panel Plus at Hat Yai, with its capacity of 330,000m3. Both are in the main listing.

Last year also saw the announcement of Kijchai expanding capacity by 300,000m3 with a new Thin HDF line, employing Dieffenbachers’ CPS+, its fifth in Thailand in two years. The line is now under construction. S Kijchai Enterprise in Rayong has produced MDF from a Dieffenbacher plant for the past five years.

The new Thin HDF plant enables the company to more than double its production capacity, making it one of the leading Thai manufacturers of MDF.

Investments in MDF continue and the Advance Fibre Co Ltd/Metro-Ply investment, has been going ahead at Karnchanaburi, adding a further 310,000m3 MDF capacity with its Dieffenbacher line, which came on stream in 2017 and is in the main listing.

Metro- Ply is also expanding internationally, with the purchase of Alpine MDF in Australia from Sumitomo of Japan. Sumitomo Forestry Co Ltd (SFC) announced in 2017 that its board of directors had decided to sell all its shares in Alpine MDF Industries Pty Ltd to Metro Particle Co Ltd.

The Wisewoods – Green Panel MDF plant at Khao Yoi, Phetchaburi, with its planned 194,000m3 capacity Siempelkamp line, started up in 2017, so is in the main listing. Also in Thailand is the MDF line announced last year by The Thai Vanachai Group, which ordered a Siempelkamp forming and press line for MDF/HDF.

The company plans a capacity of 250,000m³/yr of MDF/HDF, scheduled for start-up in 2018.

A new MDF player in Thailand is also emerging with SPB Panel Industries, which initially broke into panels in 2006, with a Dieffenbacher particleboard plant. Now a THDF/MDF plant will be installed on the same site in Surat Thani, Thailand. SPB has again selected Dieffenbacher. A 28m CPS+ press will be used, with a capacity of 800m3/day, using rubberwood.

No new investment plans are visible for Malaysia and latest MDF mill data has been updated, with the country capacity showing now at 1,505,000m3.

Apart from domestic sales and Singapore, the Middle East market has been a consistently growing market in recent years, so the importance of this region for export of MDF from Malaysia cannot be under-estimated. In a recent statement from Johor Baru, Evergreen Fibreboard Bhd (EFB) reported that it wanted to strengthen its position as one of Asia’s largest MDF manufacturers and also to be amongst the top 10 in the world, based on production volumes. MDF, it said, is still the core business of the company, followed by lamination and furniture making activities.

In India, we continue to see strong new dynamics for 2018 and beyond with the new investments in MDF volumes by the Indian wood based panel manufacturer Greenply Industries Ltd (400,000m3) and the Indian Plywood and laminate manufacturer, Century Plyboards Ltd (200,000m3), as previously reported.

Now we can add to these the MDF line which was planned and commissioned by panel producer Balaji Action Buildwell (Action Tesa), based in Udyog Nagar, and part of the Action Group, which is due to have an annual capacity of close to 250,000m3.The refiner came from Valmet, with forming and press line and final processing systems from Siempelkamp.

So, we have seen Indian capacity grow by a further 800-900,000m3 in 2017, as all these plants are now up and running and have been added to the main listing.

India is now producing 1,557,000m3 annually, which is significant for a country that, not so long ago, was heavily dependent on MDF imports. Additionally, the Indian wood based materials manufacturer Rushil Decor has now commissioned Siempelkamp as the supplier of a new 250,000m3 MDF plant for them in India. With the new plant in Atchutapuram, the manufacturer will produce MDF from eucalyptus grown in plantations and from over-mature mango trees. To meet local market needs, Rushil Decor will, with this investment, significantly expand its production capacities above its current 80,000m3/yr.

The press line will be equipped with the mat pre-heater ContiBooster. By pre-heating the mat before it enters the press it can be heated more quickly inside the ContiRoll press, resulting in claimed production increases of up to 20%.

Delivery is scheduled for the last quarter of 2018 and start-up for Q4, 2019. Rushil Decor Limited is one of the largest Indian panel manufacturers.

For some more background information, Greenply Industries remained loyal to Dieffenbacher as its equipment supplier, choosing to order its 2nd MDF line from them. The new line, with a design capacity of 400,000m3, has been set up in the Chittoor district in the district of Andhra Pradesh in south east India. It will make HDF/MDF boards from 2.5mm to 40mm and a variable width of 1830mm to 2440mm. At 56m long, apparently this CPS is the longest continuous press yet sold in Asia. Fastgrowing wood species, such as Eucalyptus, will generally be used as the raw material, with production beginning in 2017.

Century Plyboards Ltd (Centuryply), Kolkata, has been erecting its MDF plant in the province of Punjab during the last 18 months and has now entered MDF production. In making the investment decision we understand the company revived plans which had been made several years ago but were previously postponed.

The continuous forming and press line was ordered from Chinese company Dunhua Yalian Machine Co Ltd. The new plant is designed for 200,000m3/yr and was a greenfield investment project in the Hoshiarpur district in Punjab. Century ply claims to be the biggest producer of plywood, and the third biggest producer of laminates, in India.

DEVELOPMENTS IN SOUTH AMERICA

Argentina, Brazil and Chile, with a combined population of over 250 million, appear to have an underlying demand of well over one million housing units annually, which in turn is good for MDF consumption.

New mills, new entrants, new associations… the panel industry in South America is forging ahead with a vibrancy that leaves its northern neighbour behind. South American economies have recently not been so buoyant and there have been currency crises; political crises; economic crises and as a result, short-term, the demand for MDF panels has declined. However, it is a continent of change, of development, of expansion – one that is hardly in the doldrums.

Two major pieces of news give us a real focus this time on Latin America: first comes the sale by Masisa of its MDF-making facilities in Argentina, Brazil and Mexico. The plant in Argentina found a buyer in the form of Egger, a newcomer to the continent – and indeed a newcomer to production anywhere outside Europe – but one that now appears to have global ambitions.

Masisa’s divestment of its other assets in Brazil has found a potential purchaser in the Chilean panel group Arauco, through its Brazilian subsidiary Arauco, Brazil.

The complete transaction is to be finalised in 2018 because the deal must be approved by the Administrative Council of Economic Defense (CADE), a body of the Brazilian government equivalent to the SEC in the US and we will report further on this in due course in future editions.

Amazingly, virtually no MDF was produced in Brazil in 1998, but it now has the largest capacity in South America. Key producers in the region have included Masisa, Arauco, Duratex, Fibraplac, Floraplac, Eucatex and Berneck over those years.

For 2018/19 and beyond, by far the biggest future planned panel project in the region is still Duratex’s US$550m, 1.45 million m3/yr two-line complex at Novo Monte Carmelo (Minas Gerais state) at the heart of its big forest base there. Duratex aimed to start construction of the complex in 2014/15/16, with a 700,000m3/yr unit set to run in 2016, making MDP/MDF on a 77m press and a 750,000m3/yr unit for MDF, due on-stream in 2017, but these have now slipped back due to economic conditions.

But Duratex has now actually confirmed and consolidated its investment commitment in the construction of a new industrial MDF facility in Alagoas, Brazil.

The investment project, which began with Caetex (a joint venture between Caeté Agroindustrial and Duratex) was approved during a meeting of the State Council for Economic and Social Development (Conedes) on April 27th, 2017. This means the company will have the concession of fiscal incentives foreseen in the Integrated Development Program (Prodesin) to install another industry in Alagoas.

According to the project, "the coming of giant Duratex was guaranteed, with an investment of R$1.1bn and generation of 460 direct jobs." Duratex has 20 industrial units in Brazil and decided, some years ago, to implement a unit in the northeast. Alagoas was chosen as the location for its strategic position, tax incentives and the possible partnership with local companies.

In order to maintain a laminated panel manufacturing unit in Alagoas, Duratex needs areas of up to 20,000ha of eucalyptus plantations. In Alagoas, the partnership with the Caeté Plant was announced at the end of 2014, with the creation of Caetex.

Since then, the company has already planted another 6,000ha of eucalyptus in the state. The MDF and MDP panel manufacturing plant is scheduled to start operating early in 2019. The unit will have a production capacity of up to 400,000 m³.

Placas do Brasil, a consortium of furniture producers originally planning a 180,000m3/ yr line at Linhares, (Espirito Santo state) is still working on the planned project, now for a 300,000m3/yr plant, with start-up expected in 2018. The delay was put down to a relatively slow market and also waiting for build-up of the local Eucalyptus plantations,

We can now also report that Floraplac (in northern Pará state), with 430,000m3 at Paragominas ,originally due to start up its second line in 2016, is up and running and producing since mid-2017.

As previously reported, Asperbras (producing now under the brand name Greenpac) is an industrial and agri-business group in Mato Grosso do Sul state, and is a complete newcomer to panels, but serious. The company is using its eucalyptus plantations to feed a 250,000m3/yr Siempelkamp ContiRoll line and this line was also up and running in 2017 and is now in the main listing. Additionally, the group has recently announced plans to add a second line – with a capacity of about 230,000m3 when its forest base increases, making a combined capacity of 460,000m3.

Important to note, with all these great projects in mind, is that Brazil is the world’s fifth largest country by area. Its vast and varied forest sector now comes under the common umbrella of IBA, the Association for the Planted Tree Industry. This was only formed just three years ago, but is important. Led by Elizabete Carvalhaes, CEO of IBA, it can provide information on the association’s plans and actions, with figures on Brazilian forestry production and its potential. See : http://iba.org/en/

In Paraguay, the modest project to build the country’s first MDF plant, a 55,000m3 unit in Coronel Oviedo, (department of Caaguazú), was given the green light by the Industry & Commerce Ministry there. It was planned by Agroindustria del Paraguay SA as its first venture in panel manufacturing and it is taking advantage of fiscal incentive legislation for national and foreign investors to assist its investment of US$6.7m in imported machinery. The mill, we understand, came on-stream in 2017 and is now in the main listing.

In Chile, there is no new MDF capacity expansion seen at present. However, as an update on a previous topic reported, Tricoya Technologies’ partner in Latin America, Masisa, took a positive step forward in 2014 with the extension of its licence option and agreement to carry out further evaluation of Tricoya in South America, with the launch of Masisa Tricoya Super MDF. The option agreement (originally signed in April 2012), granted Masisa exclusive production and distribution rights for Tricoya for the Latin American market (excluding Brazil, for which the sales and marketing rights were non-exclusive) in consideration for the payment of technology and royalty fees by Masisa to TTL. However, we can report that, after a period of time and reflection, this arrangement has now expired.

Celulosa Arauco y Constituçion (Chile) has continued to expand its panel product global reach (including MDF). With the new international joint venture with Sonae Industria SGPS SA (Portugal), the recent expansion in Mexico and the potential acquisition in Brazil, the company really has made its mark internationally and is now recognised as a leading global player.

Consumption of MDF in South America overall is projected to increase to around 8.5million m3 by the end of 2018. Most of this will be in Brazil, which will be consuming 74% of all MDF in South America by then.

Consumption will also expand in other countries such as Argentina, Ecuador, Peru, Uruguay, Venezuela and Chile and also other non-producing South American countries, providing strong export demand regionally within the continent, as well as internationally, particularly to the US. Let’s also not forget that the continent contains some 26 countries, each with different economic conditions.

Rest of the World Summary

As we have done previously, the aggregate world capacity table now lists the capacities in the various regions of the world from 2016, 2017 and through to 2018 & beyond. With helpful input from Bernie Neufeld of Neufeld Group Pte in Sydney, and industry veteran Murray Sturgeon at Nelson Pine NZ, we can report that Australia has enjoyed spectacular uninterrupted growth, without a major recession for the past 26 years and GDP growth for 2017/18 is forecast at 2.4% and still growing. Recently, Australia has performed better than most other advanced economies, in part due to its strong inward investment and export-oriented trade links with Asia, especially China.

In 2017 MDF production again increased year-on-year (as a comparison 2014 was 475,000m3), and exceeded 593,000m3. MDF exports from Australia have declined in recent times, based on stronger domestic demand and an unfavourable exchange rate. Exports are running at about 90,000m3. Imports, however, based on grade and specification required, remain in the region of 70-80,000m3/yr.

The three MDF producers in Australia which remain active are Alpine MDF, with a capacity of 150,000m3 (now sold to Metro- Ply as mentioned earlier); Laminex Group at Gympie, owned by New Zealand-based Fletcher Building which is surface-treating a large percentage of its 230,000m3 output; and CHH Oberon, owned by Borg Industries, which is also laminating a large proportion of its 260,000m3 production. There is potential now for a modest expansion of production capacity over the next two years.

In Australia, the housing and construction sector generally has seen a very strong and positive momentum in 2017 and is projected to grow further in 2018 and 2019. This will continue to drive increased demand for MDF.

In New Zealand, the economy, which is highly trade-exposed and export dependent, especially in forest products, continues to respond to the global economic challenges with vigour.

The building and construction cycle is still forecast to shift to a strong growth path in New Zealand (albeit from a small base) over the next two years.

MDF production in New Zealand is forecast to increase gradually and any increases in production will be contingent on eventual capacity expansion and raw material availability.

The three producers in New Zealand are the well-known Nelson Pine in Richmond, Nelson, owned by Sumitomo, Japan, which also invested in a state of the art LVL line, which started up in 2014; Daiken Southland Ltd, at Mataura (formerly CHH) and now recently acquired by the Japanese company Daiken, themselves a part of the large Itochu group; and then the other Daiken MDF operation in Rangiora (formerly owned by Rayonier), Canterbury region.

Just over 80% of the MDF produced in New Zealand is exported, with production of 770,000m3 in 2017. Destinations were Japan, China, South East Asia and a small volume going to the US.

In recent years, Sumitomo bid and successfully purchased 30,000ha of radiata pine forest in the Nelson region. This purchase will strengthen the raw material base for Nelson Pine and provide potential fresh opportunities.

Domestic consumption of MDF in New Zealand is projected to increase at a rate of 3% annually to 2017/18, in view of the projected stronger housing market, and was estimated to reach 219,000m3 in 2017, which is above the peak of 211,000m3 reached in 2004, boosted by imports.

Although consumption relative to total production capacity is low, on a per capita basis, New Zealand is one of the highest consumers of MDF in the world.

With North East Asia, China, South East Asia and South America already mentioned or discussed in detail, that just leaves our ‘rest of the world other countries’ category which this year refers only to Algeria, South Africa, Iran and Pakistan.

In South Africa, it appears from our further research that only one MDF mill has been under construction in the last years: PG Bison at Boksburg in Gauteng Province with 114,000m3. This additional volume has now been added into the country capacity for 2017/18 as the mill is now operational, making a total of 289,000m3. The potential project by FX Veneers at Mpumalanga Highveld with 200,000m3 remains very uncertain and as it is not clear as to whether it will go ahead, this is not included in any of our future capacity tables.

On average, private sector housing in South Africa is still projected to grow by 12% annually to 2018/19 and the demand for furniture in South Africa has strengthened considerably over the past decade.

Despite the sharp declines in the years following the global economic crisis, MDF consumption increased by 5% annually over the past five years. The relatively strong growth in production and consumption of furniture in the past decade, as well as projections for strong growth to 2019, suggest it will be a key sector driving growth in consumption of MDF and particleboard.

South Africa currently does not have the capacity to produce enough MDF to meet its domestic requirements. Net imports over the past five years have amounted to approximately 60-70,000m3 annually.

While an excess of imports over exports is expected to continue, the balance is expected to change, with exports exceeding imports by end-2018. Based on new production and consumption projections to 2019, annual MDF exports could be around 100,000m3 and imports less than 50,000m3.

There are currently only two producers in South Africa: PG Bison and Novabord (now Sonae Arauco SA), and installed production capacity is 289,000m3, driven upwards by PG Bison’s recent investments.

In Pakistan, ZRK Industries (Pvt) Ltd’s new investment in its MDF mill with a continuous line in Mardan, by Dieffenbacher, started-up as planned in and is now in our main listing. The ZRK group is the largest wood based panel Industry in Pakistan, producing both MDF and particleboard. Having state-of-the-art plants from Europe and China, it has a distributor network throughout Pakistan, Afghanistan and Central Asia and claims to be covering the building industry needs of more than 300 million people. Its Wood Processing Division is vertically-integrated and the group consists of Pakistan’s largest, brand new, fully-automated particleboard plant, paper lamination & impregnation lines and now Pakistan’s largest brand new MDF Plant, which is operational.

Pakistan currently imports MDF from a variety of countries and is a major export market for MDF produced in Sri Lanka, by its only producer, Merbok.

Considering Iran now, and adding to the previously reported and installed national capacity listing with nine mills producing, there is the one new MDF mill to include.

This is the investment by the Arian Saeed Industrial Group Inc, with the 200,000m3 MDF plant, which we understand started production in 2016, which will help serve an expanding domestic and regional export-oriented business in that part of the world. This mill is now included in our main listing, bringing Iran’s national capacity up to an impressive 1,034,000m3.

Also, in Iran, and as per a memorandum of understanding signed by director general of Turkish company AGT, Sirzat Subasi, and that of Qazvin Industrial Parks Company, Hamidreza Khanpour, the Turkish side will invest €70m in building a factory producing engineered wood, including MDF, MF-MDF, panels, profiles, parquets and different types of flooring in the Iranian province's Caspian Industrial Zone.

"The project will be carried out in three phases. About €45m of investment will go into the completion of the first phase. The second and third phases will be completed within the next three years," Khanpour told Financial Tribune in an interview. "The MoU was signed on June 22, 2017 and Khanpour noted that it is significant for both sides.

"This is the second-largest foreign investment made in Qazvin, Iran in 2017 and that's why it's really important to us.

Moreover, it is the first investment made by AGT in a foreign country, making it significant for them," he added.

The official noted that the investment will be accompanied by technology transfer.

"The Turkish company has a 60% share in the Iranian market for these products (engineered wood). Therefore, in order to keep their market in Iran and reduce costs, they have decided to construct a factory in the country. Qazvin was chosen due to its strategic location and its proximity tothe capital, Tehran. Moreover, the availability of required infrastructure was considered in selecting the factory's location."

Apparently, there are over 1,000 firms active in the cellulose industries and some 25 companies producing MDF and particleboard in Iran, but unfortunately WBPI does not have all production details available currently.

Historically in Iran it has been typical to import MDF & particleboard from Thailand and Malaysia, and veneers and overlays from South Korea, and then assemble them in local factories. Last Iranian financial year (ended March 20, 2017), Iran imported 1.1 million m3 of MDF, worth around US$275m.

Also, in this section, and as previously mentioned, we can now advise that the new MDF mill project for Green Fibre that we reported as being developed as a project in ‘West Asia’, with the line being supplied in the future by Dieffenbacher, is actually for Iran as well. However, the specific details as to where it will be installed have not yet been publically declared. At the time of going to press we are just noting the additional volumes for the future and will keep this project under review - Green Fibre, Iran with a capacity of 165,000m3/yr.

Finally, some really interesting investment news for our global survey this year comes from North Africa, with Algeria to join the nations of MDF producers soon. In Q3 2017, the Algerian company, Bigstar, via its subsidiary Panneaux d’Algérie, entrusted Dieffenbacher SWPM (China) with an order for a complete MDF plant with a CPS+, marking Dieffenbacher’ s first greenfield project in Africa and the first continuous press operating in North Africa. The plant is designed specifically for smaller capacities.

“There is a rising demand for MDF boards in Algeria, and imports from other countries are becoming increasingly costly,” explained Bigstar CEO, Guelai Mohamed Chiheb. “We have been considering producing our own materials for a long time for this reason, and Dieffenbacher SWPM has given us the perfect concept to do so.”

The 6 ft wide, 14.5m long CPS+ for Bigstar will be supplied from Eppingen, while Dieffenbacher SWPM, Shanghai, will be responsible for the remainder of the supply and project management. Assembly will begin in the second quarter of 2018, with an expected production capacity of 250m3 per day. This is a significant development; could it be the start of a new wave of investment in MDF capacity on the African continent?

So, as previously stated in this two-part global MDF review, western Europe and North America are currently seeing fresh dynamics, with the growth in Europe coming from Fantoni’s upgrade in Italy and from the eastern region, driven mainly by Turkish and Russian investments. In North America, apart from the Swiss Krono project in the US, the capacity growth still comes from Mexico.

For the rest of the world, we must still carefully watch the developments in Brazil, China, Iran, India, Paraguay, South Africa, Thailand, Vietnam ………….and now Algeria. In summary then, our final aggregate total for global MDF capacity at the end of 2016 was 99,861,000m3 and it reached 102,734,000m3 by the end of 2017. From 2017 and out into 2018/19 and beyond we could reach 109,654,000m3, based on our current information …...the global production capacity growth continues, for this most amazing wood based panel product!