Homanit expands in Poland

24 July 2014


With the outlook for the Polish furniture industry, and the country’s economy, painted in bright colours, German wood based panel producer Homanit is continuing to expand its production capacity in Poland, reports WBPI’s correspondent in that country, Jaroslaw Adamowski

In line with the firm's investment strategy in Poland, Homanit is currently expanding and modernising its production facility in Krosno Odrzan´skie, which is located in the country's south-western Lubuskie region.

The factory makes MDF and HDF and its products are supplied to various manufacturers active in the furniture, door and automotive industry.

By the end of the first quarter of 2016, the German company is aiming to invest PLN211.6m (US$70.5m) - and add a further 20 new jobs to the factory's existing workforce of more than 310. Under the plan, the works will allow Homanit to increase its HDF output with the launch of a new production hall.

Currently, the Polish plant has an output capacity of 28 million m2. It is operated by a workforce employed on three shifts and makes a wide range of panels with a thickness of between 2.5 and 5.0mm, according to data released by Homanit. The facility is located on a site comprising some 40ha.

The investment was announced by Homanit's chief executive and owner, Fritz Homann, during his official visit to the Polish facility.

In December 2013, accompanied by a delegation of regional authorities, Mr Homann spoke about the expansion plans and the outlook for Homanit's unit in Krosno Odrzan´skie. "Today, what we have here is a small rowing boat, but we will turn it into a speed boat," Mr Homann said. "We need workers who will be able [to operate the expanded plant]."

New production hall

"The third phase [of the investment in Krosno Odrzan´skie] is the construction of a new production hall," said Mr Homann. Under the currently-implemented phase of the project, the German firm will set up a new production hall to be located on a site in the proximity of the main plant. The two previously realised phases included expanding the product transportation infrastructure at the factory, as well as setting up a line for wood processing.

All works will be carried out by the company's Polish subsidiary Homanit Krosno Odrzan´skie sp zoo.

"I'm very glad that there is a high demand for the plant's output and that the quality of production continues to improve," said Jerzy Ostrouch, head of Wielkopolskie's regional government.

Mr Ostrouch said that Homanit's factory is one of the largest manufacturing investments in the Polish region and that local authorities view it as a significant factor in reducing unemployment and attracting foreign investment.

"I'm persuaded that [owing to this project], the development of Krosno Odrzan´skie will be further stimulated," Mr Ostrouch said. "Also, another beneficial factor in this respect is the new EU financial period [for the years 2014- 2020], which creates numerous possibilities for obtaining major co-funding from national programmes."

Tax cuts for investments

The project will be carried out in the Kostrzyn´sko-Slubicka special economic zone (KSSSE). With the company's investment in mind, in March 2014, the Polish government made a decision to significantly expand the zone's area by as much as 151ha.

Implementing the project in the zone will enable preferential tax treatment for Homanit's investment over more than a decade.

Under the plan, the zones are to remain operational in Poland until 2026 after the Polish Ministry of Economy made a decision, in July 2013, to extend their operation by six years. The move is of particular interest to industries which base their manufacturing operations on a long-term return on investment (ROI) perspective.

The time schedule for implementing Homanit's project at Krosno Odrzan´skie is well chosen, since, starting in July 2014, the public aid which is made available to new investments carried out in Poland's special economic zones is to be significantly decreased.

In the country's Wielkopolskie region, this will translate into a decrease in co-funding, from the current level of 40% to only 25%.

In 2013, with the aim of overhauling its production capacities, Homanit invested €15m (US$21m) in the Polish plant. The project in Krosno Odrzan´skie is part of the company's broader expansion plans for Poland.

In June 2012, Homanit Krosno Odrzan´skie acquired rival wood based panel manufacturer Hardex SA and launched production at its plant in Krosno Odrzan´skie. The investment in the insolvent producer was estimated to be worth some PLN30m (US$10m).

Furniture makers eye higher sales

Homanit's expansion plans in the Polish market are closely related to the outlook for local furniture manufacturers.

According to figures released by the country's state-run Central Statistical Office (GUS, or Glówny Urza¸d Statystyczny), the results posted in Q1, 2014 by Polish furniture makers were overwhelmingly positive. In the first three months of this year, kitchen furniture output increased by 39.1% compared with the same period a year earlier. In the living and dining room furniture segment, local production was up 14.1% year-on-year.

In total, about 5,373 million pieces of wooden furniture were produced by Polandbased manufacturers, according to GUS' data.

The Polish government considers the country's furniture sector as one of the most important and export-oriented industries. To accelerate the industry's development, and foster increased exports to other EU member states, in September 2013, Warsaw launched a campaign to promote Polish furniture makers in various markets including Germany, the Czech Republic, China, Ukraine and Russia. The campaign is designed to facilitate entry to foreign markets for local furniture manufacturers, thus bolstering domestic demand for panels, say local analysts.

Moreover, the outlook for the Polish economy is considered positive, with the country's gross domestic product (GDP) expected to report an increase of 3.2% in 2014, and 3.4% a year later, according to data released by the European Commission.

Increased investments in Poland

Currently, Homanit operates three production facilities, located in Germany and Poland. The plant in Losheim, in Germany's Saarland, makes HDF and MDF panels, marketed under the Homadur brand, with a thickness of between 2.0 to 8.0mm.The production capacity totals about 200,000m3/ year.

The factory in Krosno Odrzan´skie, which was taken over by Homanit two years ago, is the German manufacturer's latest foreign acquisition.

The company's first Poland-based facility is located in Karlino, in the country's northwestern Pomerania region.

Homanit acquired this Polish facility in 2005 and currently the plant has an annual production capacity of 250,000m3, making HDF and MDF in thicknesses of 1.5 to 10.0mm at Karlino, according to figures released by Homanit.

With PLN380m (US$126.6m) of revenues posted in 2013, the subsidiary was ranked as the 497th largest company in Poland, in a ranking published by the country's leading news weekly Polityka.

Homanit expanded into the Polish market in 2004. Its two production facilities are ISO 9001 certified.

Headquartered in Herzberg am Harz, in Germany's Lower Saxony region, Homanit was established as a panel manufacturer in 1995.

Part of the Krosno Odrzanskie line
Older-type control panel
Steam power
Fibre mat before pressing
Loader with wood chips
Low density insulation board