Nowhere has escaped the economic meltdown, but perhaps China has suffered less than most. While it has been savaged by losses in export markets, a still-solid domestic economy (supported by government stimulus) has moderated the negative impacts of global economic stress.
For China, the worst part of the recession probably came in the last quarter of 2008 and first quarter of 2009 but recovery will initially be slow, if only because exports will drag through 2009 and well into 2010.
This is expected despite the increase in tax rebates for exporters (which may simply help to cushion the thin profits of exporters rather than immediately be reflected in lower prices and higher volumes).
There is growing concern that the domestic economy could falter in 2010 without another bout of stimulus. Unlike North America and Europe, where the effects of stimulus programmes will be felt more in late 2009/first half of 2010, the Chinese government stimulus announced in November 2008 will largely impact in 2009.
It is not clear that China understands the need to fundamentally change its business model.
The increased VAT rebates to exporters will not enamour the Chinese to their trading partners! Neither does it reflect an understanding of the nature of current economic problems; any attempt to generate export-led growth is unlikely to bear much fruit in a global economy unwilling to increase its consumption of consumer goods.
However, it is understandable why the government reacted this way, given the acute pain throughout much of the export sector.
Clearly, more emphasis needs to be placed on stimulating the domestic economy in China (and in other developing countries such as Brazil). The significant commitment of new funds to help to improve China’s health delivery system is hopefully just the first downpayment in a series of policy changes that will improve the social security safety net in China. In turn, these improvements will underpin increased domestic consumption as savings rates fall in response to a greater feeling of personal security.

Gross domestic product (GDP)
This re-structuring of Chinese consumer behaviour will take time, but the thrust of these changes over the next several years will result in further increases in consumer spending on housing, furniture and other commodities utilising wood products. At CFPA we assume that 2009 will be the trough year for Chinese economic growth.
GDP growth is assumed to be close to 7% this year, down from 9% in 2008 and 11.9% in 2007. Growth is forecast to climb
moderately to 7.7% in 2010 and to continue to climb subsequently, albeit not to the heights scaled in 2006/7 (see Table 1).

Housing
Meanwhile, after slipping 3.5% in 2008, housing completion activity will likely also edge lower again in 2009, dropping another 3.4%. Recent reports of a rebound in housing activity in China tend to confuse an increase in home sales with the level of new residential construction and/or completions.
With a large inventory of unsold homes resulting from overbuilding in late 2007/early 2008, the housing market needs to work off that inventory in 2009 before construction activity picks up later in 2009 and in 2010.

Industrial Production
Industrial markets for wood products have sagged over the past 12 months, not only because of lost export business, but also the massive global inventory correction at all levels of production and distribution.
Growth in China’s industrial output dropped to 12.9% in 2008 from 18.4% the previous year. For 2009, CFPA estimates growth in total industrial output of around 7.5%, to be followed by 9.5% in 2010.

Furniture Production
Lastly, the all-important furniture sector experienced its first drop in output in over a decade in 2008. A 1.9% decline was not catastrophic, but following growth of over 20% in 2007, the 2008 outcome was a major setback for China’s panel producers.
Recent developments require a re-think of furniture industry investment strategies as future export growth will likely be slower than over the past decade and increased attention will need to be focused on developing domestic furniture markets.
For 2009, CFPA forecasts just 1% growth in furniture production (higher domestic demand more than offsetting further weakness in exports). But with strength in both the domestic and export sectors in 2010, CFPA projects a 6.4% increase in total
furniture production next year (Table 1).

Production and exports
Recently-released data from China’s State Forestry Administration indicate that panel production in China in 2008 totalled 94.1 million m3, a 6.4% increase over 2007.
Table 2 summarizes the key components of this production (plywood, blockboard, particleboard and fibreboard; the remaining 5.2 million m3 was all other types of panels).
Through the first half of 2008, production across the board was up year-on-year. However, weakness in the second half resulted in small drops for the whole year for both plywood and blockboard (down 0.6% and 1.4% respectively). In contrast, the ongoing growth in capacity in particleboard and fibreboard led to year-on-year production increases of 37.8% and 6.5%, respectively.
Plywood production continues to lead the product pack. At 35.41 million m3, it represented 38% of total output in China in 2008, though this was down from 40% in 2007.
Blockboard’s share also slipped between 2007 and 2008, from 15 to 14%.
Fiberboard’s share held at 31%, while particleboard’s jumped from 9 to 12% as particleboard production leapt a surprising 3.1 million m3 to 11.42 million m3 (Table 2).
In part, production weakness in 2008 was induced by direct losses in export markets. Chinese exports of all panel types fell by close to 18%, from 11.3 million m3 in 2007 to 9.3 million in 2008. Plywood continues to dominate Chinese panel exports, but at 6.75 million m3, was at its lowest level since 2005 (Table 3). This decline was more than that for production as domestic demand held up better than offshore. Chinese fibreboard exports have soared in recent years, but also proved vulnerable to the global slowdown in 2008 and dropped 17.5% to 2.08 million m3.

Forecasts
Given the economic outlook discussed earlier, it is no surprise that further declines in consumption, exports and production are projected for 2009 (Figure 1). These declines largely reflect weakness early in the year; improvement is likely in the second half, continuing into 2010. But despite this reversal, total wood panel production for the whole year is forecast to drop nearly 9% in 2009, led by double-digit declines in plywood and particleboard (see Table 2). Again, weakness in exports will lead the way. Given the data reported in the first five months of the year, CFPA projects a 35% drop in total panel exports, led by over 40% declines in fibreboard and particleboard volumes (see Table 3).
However, the improvement in domestic and export markets in the second half of 2009 will be reflected in the 2010 data. With total panel exports rebounding 24%, CFPA forecasts Chinese panel production in 2010 will jump nearly 7%. Nevertheless, 2010 production will continue to remain below 2008 levels. China’s panel industry will need to wait until 2011 before setting any new production records. Further moderate erosion in plywood’s share is also anticipated.

Conclusion
After a decade of frenetic growth throughout China’s panel industry, the consumption pattern since 2007 either represents a momentary break in the previous hectic pace or a new paradigm.
We lean toward the latter belief. Pressures on log supplies (eg Russian log export taxes), higher manufacturing costs, and excess capacity, have all squeezed profitability.
At the same time, growth in key construction and furniture end-use markets will be slower over the next decade than the last, if only because these markets have passed their juvenile growth period and are entering ‘middle-age’. But given the large size of the Chinese panel industry, while growth rates over the next decade will be low compared with recent history, the volumes produced and consumed will nevertheless increase
substantially.

This article was written by Bernard Fuller, Cambridge Forest Products Associates www.CambridgeForestProducts.com. Questions and comments are welcomed and should be sent to: Bernard.Fuller@CambridgeForestProducts.com.

Suifenhe is a far-flung outpost of the People’s Republic, hanging onto its Chinese nationality by a thread as it sits on the very border with Russia in the northeast province of Heilongjiang.
Even in the very last days of April, the evening temperature is hovering around zero centigrade and the trees and shrubs are still bare sticks in a parched, wintry landscape.
The first shoots of spring are not expected for another month and yesterday’s now dirty snowfall still lies beside the roads.
The drive from the nearest airport, Mudanjiang, a small facility with only a few flights a day, on a Sunday night is long and uncomfortable on a cracked and broken twisting concrete single carriageway road that winds through the mountains. It is 160km but feels like a lot more.
Three lives are lost tonight – wasted in a head-on collision just ahead of us an hour out of Mudanjiang as the frustration of the relatively narrow road and slow-moving vehicles presumably became too much for somebody.
On the return journey the next day, a motorcyclist lies dead in the road in a pool of blood as the traffic drives around him. I am told it is much worse in the winter months.
The journey is completed in the dark, but even so, the approach to Suifenhe gives a very strong clue as to why Dare chose this rather inhospitable-looking area for its latest mill.
I have never seen so much wood in China, ever. And I have travelled
extensively in this country of so many different scenes.
It is stacked beside the road, it is loaded on lorries in log form, it is piled high at sawmills beside the road, it is stacked in small sizes outside the poor dark brick cottages of the local people. I later discover that there are 460 wood processing plants here, of all sizes.
Clearly wood is Suifenhe’s gold and it mostly comes from close neighbour Russia; the border between the People’s Republic of China and the state of Russia is about 100m from the Holiday Inn in Suifenhe.
One is used to seeing many bilingual signs in English and Chinese everywhere in China, but here they are in Russian and Chinese most of the way from Mudanjiang.
The drive to the factory from the hotel the next morning is mainly over compacted mud, past more sawmills and other wood processing operations, until we arrive at the Dare Group’s latest continuous MDF/HDF production line, rearing up out of the surrounding countryside with its high cyclone towers.
Dare Global group has a total of eight panel production lines – four of them Siempelkamp ContiRoll continuous lines each with annual capacities of 200,000m3.
These Siempelkamp lines are located at: Danyang, Jiangsu Province (the first such line to be built by the group); Fuzhou, Jiangxi; Maoming, Guangdong; and here at Suifenhe in Heilongjiang Province.
There is also a Dieffenbacher CPS continuous line for thin HDF at Deqing in Guangdong Province. That has a capacity of 150,000m3/year and started production in 2008.
Dare also has two older multi-opening lines producing MDF – one in Jiangsu Province, the other in Anhui Province. Each can produce around 100,000m3 a year and each was supplied by Shanghai Wood Based Panel Machinery Co Ltd.
Dare Global also made one foray into particleboard, building another Siempelkamp ContiRoll line at Sanming, Fujian Province. This line has an annual capacity of 450,000m3.
The company’s activities in the wood products industry are broadly divided into four product groups: Panels; flooring; solid wood products; and furniture.
The flooring division produces three different types of product: Solid wood; multi-layer wood; and laminate flooring. The main flooring production activity is centred on Danyang in Jiangsu Province.
The furniture factories make both solid wood and MDF furniture, with three factories – in Danyang and in Fujian Province.
Dare also has a door making factory and another small unit making architectural wood trim.
The group uses three brand names: Dare Wood Group; Power Dekor (for laminate flooring); and Kangsu (for solid wood flooring).
The wood group in total has a turnover of seven billion yuan (US$1.03bn). The group also has other diverse interests outside wood, giving it a total turnover of more than RMB10bn.
“That first ContiRoll line in Danyang started production in 2003 and now, six years later, we have built this plant in northeast China,” said Suifenhe’s general manager Shen Dan, whom I first met when Danyang was under construction. “Danyang was the first continuous line for Dare and this is the first time that such a large company has built a panel manufacturing plant in this part of China.
“Danyang took around 14 or 15 months from start of construction to the first board. Suifenhe took 14 months and 20 days,” said Mr Shen.
The company is particularly proud of this achievement because the conditions here bear no comparison with Danyang much farther south. To give some idea, I left Beijing in temperatures in the mid to high 20s centigrade on Sunday afternoon to disembark from the plane in zero degrees two hours later.
In the Suifenhe winter, temperatures regularly fall into large minus figures and when the first board was produced in December 2008, it was minus 28oC. Perhaps Dare was lucky – some years it falls to minus 40oC.
Although the heart of the two lines is similar – Siempelkamp ContiRolls – other elements are different, as Mr Shen pointed out.
For instance, firstly, Danyang purchased wood preparation and refining equipment from Andritz and the energy plant from Vyncke of Belgium.
Suifenhe has chip dry cleaning and refining and dryer from Metso, while the energy plant was supplied by Chinese company Changzhou Union.
However, machinery sourcing was not the only difference between the two plants – the technology employed was also different.
In Danyang, chips are washed before refining but for Suifenhe, it was decided that dry cleaning would be cheaper and better; it is the first such plant in China. Anyway, chip washing in the winter is out of the question here.
Also the dryer is two-stage as opposed to the single-stage dryer employed in Danyang.
The Suifenhe line is also designed to produce both thin board and low-density board from its ContiRoll.
“The target of our Suifenhe mill at the moment is environmentally-friendly production of medium and high density board for the furniture industry,” said Mr Shen. “Danyang and the other Dare fibreboard lines are mainly producing board for flooring.
“There is a fundamental difference between Chinese MDF and foreign-made board for furniture production and that is the density. In China, people prefer 750kg/m3 or more but, according to my experience, foreigners prefer 650kg/m3 or less,” explained the general manager.
“As far as I am concerned, China will also realise the need for lower density board for furniture in time and so Dare Group is trying to use this line to produce lower density board for the first time in China. I think this concept, which now belongs to Dare, will in the future influence the whole Chinese wood products industry.”
Mr Shen went on to point out that most furniture board in China is produced on multi-opening lines and he feels that the quality and cost is a big problem for these lines.
“We urgently need to upgrade the quality and technology of furniture board manufacture in China,” he said.
“We feel that our group is competitive because we use the ContiRoll and of course we have some other ideas, too. A Siempelkamp four-feet-wide ContiRoll with an annual capacity of 100,000m3 I think would be the most economical way to produce furniture board. That is just my idea, though.”
The Suifenhe ContiRoll does not however follow this principle. It is 8ft 6in wide and 37.1m long.
“This line is not only for furniture board and the Dare group tends to invest in big lines,” explained Mr Shen.
“This line is designed for an annual capacity of 200,000m3 but I am sure that in future, if we build another line, it will be more like 150,000m3 or less due to pressure on wood resources. Personally, I think this is the way China will go in the future.”
Mr Shen went on to explain that there is another fundamental difference between the Suifenhe line and Danyang and that concerns the resources.
“Most of the wood we purchase here comes from Russian wood processors. In terms of quality I think China has very good wood resources, but in the south it is mostly faster-grown wood and I think the main difference between Chinese and foreign boards for furniture production is in the wood raw material and we are able to change that situation.
“Every year, this city imports around seven million cubic metres of logs and it processes three to four million cubic metres of raw wood. This is the most important reason for Dare being here – both the quantity and the quality of the wood.”
I raised with Mr Shen the question of Russian export taxes on logs, delayed earlier this year (WBPI Feb/March, p5).
“We have considered this [threat to supplies] but we expect cost in the coming years to be stable – far east Russia relies heavily on log exports for its living. I cannot deny that in coming years there may be limitations on wood supply from Russia as its economy grows, but there is also a local supply of good wood around Suifenhe itself.”
Dare only has a relatively small back-up chipper in Suifenhe and relies mainly on prepared chips from the surrounding wood processing industries.
Mr Shen’s fifth and final point concerning the significant differences between the Danyang operation and here concerns the market.
“We can take advantage of the area of this city and can export to Russia, Japan and South Korea, although our largest market is northern China – Dalian, Harbin and Shenyang.
Actually there is a sixth difference – the climate!” continued Mr Shen, smiling. “From December to April it is normally below 15oC at least and this does cause us a lot of difficulties – especially as the management is from the south!”
Mr Shen admitted that the Chinese market is currently out of balance, with supply exceeding demand.
“Because of this, China has to reconsider the whole market,” he said. “Maybe there needs to be some integration and the closing of plants with capacities below 30,000m3/year.
“But the situation in China is very complicated. It is a huge country and different areas have different situations. We expected more integration in 2005/6 but it didn’t happen. We still believe the Chinese panel industry has a bright future because, in the end, the market decides everything.”

In the early days of Shanghai Wood Based Panel Machinery’s (SWPM) existence, when it was founded by the China Forestry Bureau, the company made production lines for the manufacture of wet-process fibreboard (hardboard).
In the 1970s, the company became part of the Shanghai Electrical Co (SEC) and continued to produce hardboard lines but also added plywood production lines with cold press, hot press and glue blending.
The company later added the technology for particleboard production to its range, but perhaps the most significant development for the company was when it developed its first MDF line, in 1992.
SWPM went on to become the major supplier of multi-opening presses and complete lines for MDF production in China and to begin exporting to other parts of the world.
Then, in a move which surprised many in the global panel industry, the world’s number one panel producer, Kronospan, purchased a 70% shareholding in SWPM in October 2004, while SEC retained 30%, as it does today.
Kronospan made the purchase through its subsidiary Kontex of Hong Kong, set up for the purpose of forming the joint venture with Shanghai Mechanical and Electrical Industry Co Ltd, a subsidiary of SEC.
However, subsequent to my visit to SWPM in late April, major machinery manufacturer Dieffenbacher of Eppingen, Germany, announced that it had bought Kronospan’s majority shareholding in SWPM. This was announced on May 15, 2009.
As soon as it bought the company in 2004, Kronospan immediately introduced some efficiency measures and reduced staffing levels quite dramatically, although that had been a trend for some years already; fifteen years ago the company employed 1,200 people, whereas today the figure is less than 500.
The offices were the subject of a major refurbishment project in 2007, while in 2008 a new research and development (R&D) centre was opened adjacent to the main offices.
“With the help of Kronospan after their takeover, we upgraded our management systems,” said Li Jie, manager
of the international sales department
of SWPM.
“Then, under the technical support and supervision of Kronospan,
we launched our first ContiPlus continuous press, using the knowledge and
experience of a long-term user of
continuous presses.”
This press was installed in Kronospan’s Bucina DDD particleboard factory in Zvolen, Slovakia in 2007 (WBPI April/May 2009, p35).
The continuous press had been under development by SWPM since its preliminary designs were drawn up in 1999 and the first one, a 4ftx18m unit, was test-run in SWPM’s own works in 2005.
The Bucina press is 45.1m long and eight feet wide. SWPM delivered its first 4ft wide ContiPlus at the end of 2008, to a Kronospan plant in Strzelce in Poland. That press is 38m long.
The Anting factory is now making an 8ftx52m ContiPlus for particleboard production at another Kronospan factory in eastern Europe; the name was not revealed.
It is also working on orders from two Chinese customers for 4ft-wide presses. Global Jiahe Panel Board Industry Co Ltd of Xian in Shaanxi Province has ordered a 32m long press as its first panel production line. It was delivered in May, to produce particleboard during 2010.
Jinyang Wood Industry Co Ltd in Xinjiang Province has ordered a 38m ContiPlus and is an existing customer of SWPM for multi-opening press lines. This press will go out in November this year to produce MDF some time in 2011.
“Since the arrival of Kronospan we have also invested a lot in advanced machine tools for making state-of-the-art products and we have many new machining centres in our factory now, including a new milling machine for hot platens installed this year,” said Mr Li in April, before the Dieffenbacher takeover had been announced. “The investment since Kronospan bought into the company has been greater than for many years.”
The products of SWPM fall into five main categories: First are press lines from forming station to finishing section with the technology for the production of MDF, HDF, particleboard and OSB using the company’s latest product, the ContiPlus continuous press, in four or eight foot width; then there are the more traditional multi-opening press lines including all the technology for MDF, HDF and particleboard production with various sizes of press being offered, both in terms of number of openings and platen size.
Short-cycle press lines for board sizes of 4x8ft, 6x8ft, 6x12ft, 7x9ft and 7x14ft are also made at the factory in Anting.
The fourth category of products is press lines for other industries such as high pressure laminate production, printed circuit boards, rubber belts, etc.
Lastly we come to refiner systems. Refiners for fibre production for
MDF are offered in 36, 38, 42 and
44 inch diameters.
In all cases, design and assembly is carried out in the Anting factory but for big projects, some components are outsourced, such as electric motors.
“In general, we develop new products in a customer-oriented process,” explained Mr Li. “At the present time we are mainly upgrading the ContiPlus for better performance and lower manufacturing costs for us. We are currently importing a lot of components from Europe and we are now looking at manufacturing those inhouse.
“We also provide existing customers with technical support for their production, troubleshooting, and spare parts at competitive prices.
“We want our customers to have stable production, lower costs and increased sales and we are helping them to do that.”
Clearly the market for new machinery is difficult in the current economic climate, but SWPM claims to have 100% of the Chinese-made complete line projects placed in China in 2009.
“At the end of last year, some projects and orders were suspended but since the national government injected a lot of money into the economy, most of them are now back on,” said Mr Li.
So what about SWPM’s plans for
the future?
“In the short term, we hope to increase sales of the ContiPlus in both the domestic and export market and gain more project experience,” said Mr Li. “In the longer term, we want to become a leading player in the panel machinery market worldwide.”

In his report from Weihua’s newest factory in FengKai, Guangdong province, Mike Botting listed the nine lines owned by this rapidly expanding panel manufacturing group (see WBPI issue 3, 2009, p24). Those nine lines – three multi-opening and six continuous – give the company a total output capacity in the region of 1.5 million cubic metres of MDF/HDF in China.
The line that is the subject of this story is located in Jiuji Town, Xiangfan City, Nanzhang County, in Hubei province and was the third continuous press for the Weihua Group.
Hubei Weilibang Wood Working Corporation, a member of the Guangdong Weihua Corporation, is located on a new industrial site on former agricultural land and is one of only two factories there. It is about three to four hours’ drive from Wuhan, the nearest large city in Hubei province.
This Weihua group factory covers an area of around 400mu (27ha). After passing through the group’s signature entrance gate to the site (designed to represent trees on the one side and panels on the other in an abstract way and common to all Weihua sites), one approaches the impressive office building.
Inside is a large atrium with balconies surrounding it on all sides leading to offices on the upper two floors. This atrium also features a stone wall with waterfall feature with the water falling into a large fish pond. All very tranquil.
Construction of these offices, the apartments for the workers and the canteen/social building began in March 2007. The site also contains a ‘hotel’ block
for visiting engineers and customers as the drive from Wuhan is long and
rather tedious.
Weihua, in common with most Chinese panel makers, builds its offices and accommodation before the factory buildings, rather than using temporary buildings until after the line is running as is the practice in some other countries.
The contract for the machinery for the MDF/HDF production line was also placed in March 2007, with the main part of the line being awarded to Dieffenbacher of Eppingen, Germany.
Capacity of the line is around 150,000m3 a year and the main thickness produced is 4.75mm for customers who produce laminate flooring and doors.
I asked the vice general manager at Xiangfan why the company chose this location. He gave a two-pronged answer:
“Firstly we have access to a good wood raw material supply as there is a good supply in Hubei province and not many industries utilising it – there is only PTP Hubei’s MDF line, Baoyuan MDF and us” said Li Bao Ming.
“Secondly, we are close to Wuhan, which is a city with a good market for the trading of all wood products. Fifty percent of our production goes to Wuhan and 50% of that goes to two laminate flooring manufacturers there. In fact, one customer has just placed a contract for 5,000m3 a month.”
That all-important wood supply is made up of 40% pine, 20% poplar and 40% mixed wood species – all of it plantation-grown and apparently within an unusually small, 40km, radius.
“Weihua has its own 50,000mu (3,350ha) plantation in the local area,” said Mr Li. “The company supplies the seed to the farmers and buys the trees from them at the market price.”
As a group, Weihua has 650,000mu of plantations of fast-growing, high-yield forest in Guangdong province, here in Nanzhang County in Hubei province and in Handan City in Hebei province.
Waste wood supplies the fuel for the GTS Energy system and is supplemented with bought-in sawdust which is available locally very cheaply, according to Mr Li.
Chipping of the incoming wood is carried out by Pallmann machinery and all chips are produced on site, not bought in.
Pallmann, of Germany, also supplied the refiner, which is a 52in diameter unit.
Dieffenbacher supplied the equipment from the drying area to the finishing line, including a CPS continuous press that is 24.2m long and eight feet wide, with a Sandvik stainless steel endless belt.
This line was ordered at a time when all European machinery makers had very healthy order books and Dieffenbacher had a policy of making use of some of its manufacturing facilities outside its Eppingen headquarters, where its quality standards could be guaranteed. Hence the hot platens for the Xiangfan CPS press were made at Dieffenbacher North America Inc’s factory in Windsor, Ontario, Canada.
Like most Weihua factories, Xiangfan is equipped with an Anthon of Germany cut-to-size system and a Steinemann sander.
The sander was originally purchased as a six-head machine but by September 2008 Weihua had decided that it needed to be an eight-head and ordered an extra two heads from Switzerland. The enlarged sander was due to go into operation in June.
In common with all other nine Weihua lines, Xiangfan has its own resin making plant.
Inevitably, I asked Mr Li how his factory was coping with the economic downturn.
“In the current economic situation we are paying more attention to board quality than to output,” he said. “We want to produce a very good quality product and because our production only started last September, it takes time to learn and to train the people to increase the quality of the board. If we were to go for full-capacity production, maybe the quality would not be so good.”
For the higher level staff, Mr Li said that they came from other Weihua Group operations, bringing their production experience with them. For new staff, over 90% were sent to the company’s first CPS line in Qingyuan, Guangdong province, for a year for training. Xiangfan employs a total of 280 staff. Total investment in the Xiangfan project was RMB370m (US$54.3m).
Whilst each Weihua factory has someone responsible for its sales, overall sales policy is centrally directed from the group headquarters in Guangzhou.
“The whole Weihua Group pays attention to board quality and different factories supply different types of board to make a big product range and expand our customer base,” explained Cheng Da, sales manager at Xiangfan.
“The average price of the board has reduced by roughly RMB400/m3 (US$59) between August 2008 and now – from RMB2200 to RMB1800 – maybe less today,” said Mr Cheng in late April.
Weihua has considered diversification from its MDF/HDF product range and had in fact drawn up plans for the group’s first blockboard line to be built on the Xiangfan site. However, the economic situation has caused the company to rethink those plans and to put the development on hold.

The Weihua group is just about to start up its ninth fibreboard line, further strengthening its position as one of the largest-capacity manufacturers in China. Mike Botting visited the construction site in April to bring the first of his reports

A major UK cabinet door producer, BLP, has set up a factory in China to produce the same high-end furniture components that it makes in the UK, but at lower cost. WBPI visited the company’s factory in Suzhou, near Shanghai. It has become increasingly common in recent years for European and North American furniture manufacturers to move their production base to China in order to save on production costs, largely through cheaper labour rates. The furniture which most people probably associate with the ‘Made in China’ label is likely to come flat-packed in cardboard boxes for self-assembly and to be at the lower, economy, end of the furniture market, where ‘quality’ comes second.

The company formerly known as Hebei Yingang Man Made Board Co Ltd is now known as China National Salt Industry Yingang Artificial Slab Ltd but there is much more than a change of name to report about this fast-growing enterprise. Hebei Salt Company and Zhending County Changshan Plastic Products factory formed a joint venture to develop the panel manufacturing interests of Hebei Yingang Man Made Board Co Ltd and today the company occupies a 65.8 acre site with factories covering 77,929m2 and representing RMB820m (US$120m) in fixed assets. The company employs 680 staff at Zhengding in Hebei province.

Established in 1982, the Zhejiang Luyuan Group has a total of 11 production lines around China and a combined capacity of around one million cubic metres. We visit the company’s most recently completed project, in Yangdong. Zhejiang Luyuan Group built its first panel production line in 1984, in Suichang, Zhejiang province in the east of China. It was a wet-process hardboard line with a capacity of 10,000m3 /year. In 1995 the company moved into dry-process fibreboard, or MDF, buying its first, seven-opening, press line from Shanghai Wood Based Panel Machinery Co Ltd (SWPM). This line had an annual capacity of 30,000m3 and replaced that original hardboard line. Fast forward to 2003 and we find the group building its first, imported, continuous press line from Siempelkamp of Germany.

Li Ren Wood Group has a relatively long history in wood based panels and owns several companies trading under different names. In the first of his reports for Part ll of our Focus, Mike Botting visits its latest factory, Senlan Wood Co in Fujian province.Li Ren was originally a wet process fibreboard producer with a capacity of 10,000m3/year at its factory in Lishui, Zhejiang province. In 1994 the company switched to MDF production with a 30,000m3/year Chinese-made line, also at Lishui. This was achieved by modifying the original wet process line. In 1995, another MDF line was installed at that site, again with a capacity of 30,000m3 and utilising Chinese-manufactured equipment.

The Weihua group has built a lot of continuous production lines in the last few years and one of its most recent is in Liaoning Province, as Mike Botting reports

ShaanXi Zhong Xing Timber Co Ltd is a privately-owned  business with four MDF lines, a 15-year history in the business and some interesting plans for the future. Mike Botting visited its latest line near the world-famous city of Xian

German machinery supplier Wemhöner Surface Technologies first entered the Chinese market in 1983. It formed a local sales company in 2004 and in 2007 opened its own factory in Changzhou. Mike Botting visited that facility

The Liren Wood Industry Group (LR Group) has an annual production capacity of 720,000m3 and was an early entrant to the Chinese MDF industry. Mike Botting visited its latest, rather unusual, line in Jiangshan City