The economic crisis in North America obviously continues to have most of the world in a state of considerable nervousness as other countries ponder the likely knock-on effects for their economies.
However, in this issue's Focus on North America, we begin with two articles looking at the US economic situation and the effects it may have going forward: the first article considers the implications for the US housing economy in general and the effect on the panel industry (p25), while the second looks at the situation from a panel manufacturer's perspective (p28). I think you will find them less depressing than you may imagine.

It is just a year now since I was brave, or stupid, enough (depending on your point of view) to question whether man's generation of CO2 was really to blame for global warming.
I said in my column in Issue 2, 2007 (April/May) that, while global warming is a fact, the reasons behind it are less certain.

As I write this column in late January, the world's stock markets are in sharp decline and the R-word, for 'Recession', seems to be in every news bulletin.
Companies are revising their forecasts downward for 2008 across Europe, and elsewhere, as the problems in the US economy apparently drive sentiment in the rest of the world. As you would expect, the North American OSB industry is suffering badly as the US housing market stalls and this has had a knock-on effect on the European producers in the second half of 2007 - a year which started with such promise.
Expansion plans in the US and Canadian OSB industry are mostly, though not entirely, being put on hold or cancelled and mills are being closed or production suspended, while in Europe some major mills are taking extra downtime to try and match supply with demand. The producers will all be hoping for some upturn when the better weather comes in the spring. On a brighter note, APA-The Engineered Wood Association, is making upbeat forecasts for OSB in the years ahead (see p50). South America, on the other hand, is showing considerable activity in the OSB sector now, with takeovers and mergers - and new mills going up. The producers are also finding markets outside their traditionally strong customer base in the US (see OSB, pp14-25 for our full survey of the world's producers and markets). In fact, South America is the hot topic in this issue of WBPI as in January, as we went to press, Sonae announced that Chile's Masisa had bought Brascan's shareholding in Tafibras, in which Sonae has shares (news, p12). I have a feeling that this may be just the beginning of a round of consolidation among panel makers in various parts of the world in 2008 - and maybe among machinery makers as well. In the last issue of 2007, we reported that Siempelkamp had acquired the press business of Metso Panelboard and in this issue we find that Dieffenbacher has purchased Metso's forming, drying, sifting and handling businesses (news p5). That leaves Metso with only its refining activities. It also left us with only two suppliers of continuous presses. Or did it? Shanghai Wood Based Panel Machinery Co Ltd (SWPM for short) has started up its first continuous press at its owner, Kronospan's, mill in Slovakia. That is a development that I am sure will be watched with great interest by the global industry. With the annual round of exhibitions and conferences kicking off, I look forward to seeing you at 2008's events around the world.

I think it is fair to say that one of the major worries of the panel manufacturing industry in many regions is the issue of formaldehyde and whether or not it is a health hazard.
Of course it is an even bigger worry for those companies involved in the supply of formaldehyde, or products containing added formaldehyde. I underline the word 'added' because as most of us know, there is no such thing as a formaldehyde-free panel if it contains wood or any other once-living material.

There are times when the 'global market' that everybody talks about really makes itself felt and not always in a positive way.
The US is certainly making itself felt globally as I write this column, with the poor state of its housing market having major repercussions in two main areas at least.
Firstly, of course, there is the severe downturn in the market for structural panels in the US. Although this mainly impacts on the North American producers, there was a time, not so long ago, when European OSB manufacturers were exporting to the booming US market, which couldn't make enough to meet the demand. In the UK, where I am based, the impact of the US housing slump has, in the middle of September, wreaked havoc in the banking and political systems. The crisis in the US sub-prime mortgage market has affected the climate for borrowing and lending around the world, but the immediate effect in the UK has been to expose the weakness of the nation's eighth largest bank and fifth largest home loans provider, The Northern Rock bank. The government has, in an unprecedented move, stepped in to guarantee savers' funds deposited with the bank, without limit, as its share value plummets. At least one other UK bank is also being viewed warily by the public and by financial institutions.
In an economy such as the UK's, built largely on very heavy personal and national debt, these are worrying signs. I suspect that other countries might well have similar problems in their banking systems if the financial turbulence continues. As money supply becomes tighter around the world in the wake of the problems in the US, we must hope that the very encouraging signs of growth in the panel manufacturing industry, so apparent at the Ligna show in May, and since, are not adversely affected. Some very significant news within our own industry is the takeover by Siempelkamp of Germany of the continuous press and energy plant division of Metso Panelboard of Finland (see p6), located in Hanover, Germany. As many readers will remember, the Metso Contipress was originally the Küsters continuous press, with its unique chain system behind the endless stainless steel belts. It is also one of only three continuous presses on the world market (so far - we still await definite news from China on a new competitor press) and now Siempelkamp owns two of them. The takeover came into effect at the end of September so it is still early days. Siempelkamp has announced that it will continue to supply spare parts for the Contipress, but has only mentioned continuing full manufacture of the energy plants at Hanover......  

First, the good news: May's Ligna exhibition may seem a long time ago now but for the vast majority, if not all, the exhibitors the memory lingers sweetly on, buoying their spirits.
As I travelled the exhibition, the mood of optimism was everywhere, with all the exhibitors reporting very good contacts and, I suspect, an unprecedented number of orders actually placed at the show, as opposed to signing deals set up beforehand.

For some years now all the talk in terms of expansion in MDF, and to some extent particleboard, production has centred on China.
Then, in 2005, the Chinese market went relatively quiet for the European complete-line machinery suppliers and most thought it was likely to stay that way for a while. However, in 2006, Chinese panel makers again became active, with five or six new continuous mills being built. Orders for 2007 are coming in and it is generally expected that a similar number of mills to 2006 will be ordered this year and next. These are chiefly MDF/HDF rather than particleboard, which is also against the trend expected two years ago; it seems particleboard is not as readily accepted in China and its stubbornly low price is also a problem.
Meanwhile, the trend within that fibreboard capacity growth is towards thin board - often HDF for laminate flooring substrate. People frequently ask: "Where is the 'next China' going to come from?" The answer, it seems to me, is that there probably won't be 'another China' in terms of large numbers of mills being built in one country, or even one region. As Part 1 of our MDF survey in this issue shows, development is now more widespread. Areas of Europe are experiencing quite strong growth in capacity. Western Europe has been relatively quiet in terms of new-build, while Turkey added 420,000m3 with a new-build and an extension and will add more in 2007. So will Hungary and Poland, while in 2008, and beyond, Poland, Russia and Turkey (again) feature. Meanwhile, in South America there is a lot of activity, with the world's biggest continuous press to be built at Duratex in Brazil, a small new MDF mill in Chile and four MDF production lines being supplied to Mexico and Brazil by SWPM of China (News, p10). As Richard Higgs points out (see p20), Brazilian companies Satipel and Berneck also plan continuous MDF lines for 2008 production and Fibraplac, Arauco and Masisa all have plans for Brazil. The next issue of WBPI will cover this region in MDF Part ll. So you could say that 'the next China' is already here - in parts of Europe and in South America for instance - and I suspect that kind of more scattered expansion of the world MDF industry will be the pattern for the future, with no one country or region dominating as China has in the recent past. The controlling factor going forward must be the wood resource and that is an increasing problem worldwide, either due to paucity of supply, or because of fierce competition between paper producers, energy generators, biofuel synthesisers and the most sustainable users of all - wood products manufacturers.  

A comfortable pair of shoes. My note book and pen. A catalogue. It may still be a few weeks off as you read this issue, but Ligna+ 2007 is approaching fast and, yes, I am getting ready to pound the halls of the Hanover Messe once again.
Apart from the shear scale of this exhibition, I am left in no doubt about its importance by many people I meet in my travels around the world. I am often told by those who have built a panel manufacturing line or new factory that it all started at Ligna.

As we start a new year, the tables have very much turned in the OSB industry worldwide, as our surveys in this issue reveal.
In last year's report on the market in 2005, North American mill owners were well inside their 'comfort zone' after three years of unprecedented demand and the associated bumper profits. However, they were, it is fair to say, viewing 2006 with some caution as forecasters talked of a marked fall in housing demand. The reality was far worse.

This issue contains two conference reports, the annual European Panel Products Symposium (EPPS), organised by the BioComposites Centre in Wales, and the biennial European Wood Based Panels Symposium, organised by the European Panel Federation and the Wilhelm Klauditz Institute and held in Germany. In the case of EPPS, this was the tenth such event (and the fifth for EPF/WKI). The symposium started life in the Imperial Hotel in Llandudno in October 1997. It has since moved to a purpose-built conference centre in the town and next year is to change its name slightly and move further afield, to Cardiff in south Wales.

Public perception is everything. Is the industry producing a high-quality decorative paper based surface to compete on equal terms with solid wood, veneer or stone, or is it producing 'just laminate'?
"I can't afford 'the real thing', so I will have 'just laminate' on my kitchen worktops," says Mr or Mrs homeowner. This issue was raised with some enthusiasm by chairman Lee Miller at the TAPPI Decorative and Industrial Laminates Symposium in Atlanta in August (full report starts on p44).
He wants the industry to raise the profile of laminates generically. He said the industry had marketed to the specifiers and not educated the public. He talked of a 'Decorative Surfaces Institute' to raise the industry's own image to be the "premier decorative product", funded by the industry for the benefit of the industry. His other concern was with rogue contractors who use a lower grade of laminate than that specified. For instance, he highlighted the potential use of non fire retardant laminate where such a grade was demanded. As the grade is stamped on the back face of the laminate, how would the client know? Another example is the use of unbacked laminate worktops above dishwashers, where heat and humidity levels lead to warping of the worktop. The result of these misuses is not, of course, one instance of fire damage, or one worktop failure. The real result is damage to the image of decorative laminate in total. Mr Miller suggested certification of contractors as one answer to this problem. Decorative laminate technology has developed so dramatically that it takes close examination to tell a wood-grain or stone-effect laminate (particularly if it is embossed-in-register) from real wood or stone. It is no longer 'just a laminate' but a high-quality product in its own right - available in unique and stunning designs as well as copies of natural materials - which has resulted from extensive research and development and should be appreciated as a surfacing choice in its own right, not as a 'cheap' alternative. Does this all sound a little familiar to panel manufacturers too? If a non moisture-resistant panel is used in the wrong place. or a panel is subjected to bad site practice, failure can result and that will reflect badly on wood based panels in general. Too often the supplier of a panel has not enquired as to its end-use to ensure the correct product is being supplied. Generic promotion of all products, including the value-added ones, and of their correct application, would obviously benefit the whole industry and improve that public perception. But who is going to do it?  

The panel industry, together with all other sectors of the wood products business, is fighting an ongoing war.
A war is made up of many battles and several of those battles have already been won by the industry and/or its representatives. Unfortunately there always seems to be another one to fight.

Writing this column in mid-May in the UK, I am blessed with warm spring sunshine and blue skies (and an official drought in several regions of the country by the way!). Everyone in the industry in the northern hemisphere should be seeing the first green shoots of new spring growth after what was, for many, some long hard winter weather this year.

It is a pleasure to be able to report good news for a change and an even greater pleasure to say that there are several items of good news in this issue. Firstly, two important German machinery supplying companies, both driven into receivership largely by circumstances beyond their control, have been rescued. I refer to the former Babcock BSH, dryer manufacturer, and Vits Maschinenbau, maker of decor paper impregnation lines, both of whom feature in the news.

At the AGM of the European Panel Federation (EPF) in June, Robert Kokshoorn gave a presentation on behalf of the Asia Pacific MDF Exporters Association (APMEA) of which he is chairman. The main thrust of his address was a call for closer cooperation among MDF producers in the two regions through APMEA and the EPF. He feels such cooperation would have benefits, particularly in marketing initiatives and the generic promotion of MDF as a versatile product. Such promotion has always been a strength of the EPF and with wood products now enjoying long-overdue recognition for their environmentally friendly attributes, a united voice from the MDF industry in Europe and Asia would seem to have many advantages.

Nearly 86 million cubic metres. That is the figure we have come up with for world particleboard manufacturing capacity at the end of part ll of our marathon survey. We are by no means saying that is the definitive figure, but it is a start in trying to establish the first realistic catalogue of the world's mills and their capacities.

It seems the MDF industry is always approaching another capacity milestone, and in part ll of our survey of world mills, we find global capacity will be nudging 30 million m³ by early next year. John Wadsworth again received an excellent response to his survey and one particularly interesting result this time was a significant increase in information about the number of MDF mills in China.

We are in an odd-numbered year so it must be time for the big biennial exhibitions, Ligna and Interzum. Chronologically, the first is Interzum, the exhibition for the value adding sector, in Cologne. For the past five years, this event has had growing competition from the annual ZOW exhibition, held in north Germany's furniture heartland every February. While ZOW is a far smaller event than Interzum, some consider it more user-friendly, focused and better timed for choosing furniture designs for the new season.

As I write this column, the United States is still embroiled in the aftermath of an indecisive presidential election. With each new day, the embarrassment for the nation, domestically and internationally, grows, and the uncertainty in political circles and financial institutions worldwide increases. Taking a slightly selfish view, it has made life challenging for WBPI as well, as it happened just as we were going to press with our North American focus.