In 2016 several major transactions were seen in the European panel industry. The most significant was probably the consolidation of the joint venture by Sonae Industria SGPS, SA of Portugal and Chile’s Celulosa Arauco y Constitution.

Arauco has now entered the European panel market through this new venture, now named Sonae Arauco. Sonae had apparently been exploring its options for the future since the second quarter of 2015 and had been linked with several takeover candidates by sources in the European panel sector prior to the deal with Arauco being concluded and approved by the European Commission’s Directorate General for Competition on 26th February 2016. Where appropriate in the main listing, the new ownership has now been reflected accordingly.

In our last survey, we reflected that there had been significant investment activity in Turkey and eastern Europe, with several new projects being listed in both areas. Now we can confirm that the two MDF plants, at Camsan Bodurlar and Starwood Bursa began production in 2016.

Significantly, the ongoing investments in Turkey continue, with SFC Kronospan’s plant under construction for start-up in 2017/18.

All upcoming new mills are listed in Table 1: ‘European capacity development for 2017 and beyond.’ This includes the investments by Yildiz Entegre of Turkey overseas in Pitesti (Romania) and Vladimir (Russia). There is also the Pavlovskiy MDF mill east of the Urals, along with recently announced plans by the Russian conglomerate Altayes to build a large-scale MDF plant in the Altai Krai region in Russian Siberia, bordering Kazakhstan.

In North America, MDF production and sales showed continued recovery in 2016 and the industry generally had a good production year, driven particularly in the US by the strong dynamic of the domestic housing market. Weyerhaeuser Company and Plum Creek announced in 2015 that they had entered a definitive agreement to create the world’s premier timber, land and forest products company, with more than 13 million acres of the most productive and diverse timberland in the US. The arrangement has bedded down throughout 2016. One consequence of this is that Plum Creek MDF in Columbia Falls, Montana – well-known as a quality producer of MDF for so long – now becomes a part of this newly emerging powerhouse.

Acquisition news from North America includes the sale of Clarion Board’s HDF/ MDF plant in Shippenville, Pennsylvania, to Kronospan. We also saw the world-famous Medite MDF mill in Medford, Oregon sold. It has now settled into Roseburg Forest Products.

The new investment announced by Swiss Krono for an HDF/MDF plant at its facility in Barnwell, South Carolina is moving ahead.

This is to support its existing laminate flooring business, which up to now had been based on raw materials bought in from elsewhere. The expansion will allow Swiss Krono to produce 300,000m3 of HDF per year, which the company will use for laminate flooring manufacturing; and will sell to furniture, cabinet, fixture, door and other wood product manufacturers.

Preliminary engineering has been completed and construction started in mid-2016. HDF operations are to begin by the summer of 2018. Once completed, this expansion will increase Kronotex USA’s Barnwell County workforce to 275.

In Canada, the MDF business remains consistent, with a gently-improving market over the last year. The most positive news is that the recommissioned ATC mill in Pembroke, Ontario is now fully operational and that the West Fraser mill in Quesnel BC, which halted production after an explosion in March 2016, should be up and running by mid-2017.

In Mexico, the positive capacity developments outlined last year are all progressing well. These are reported in more detail later in this article.

A year ago we suggested that a gradual recovery across Europe might be on the horizon, country-by-country, and this has indeed been seen in some cases. It is, however, not universal across all markets, due to difficult economic and socio-political dynamics.

This year’s survey once again provides listings of capacity in Europe and North America as at the end of 2016. We also show the changes expected in capacity during 2017 and 2018 and beyond.

Total all-European installed capacity reached 26,744,000m3 in 2016, compared with 24,401,000m3 in 2015, with major growth seen in Russia, Belarus and Turkey.

Most of the MDF mills continue to work hard to optimise their installations (some are not running at full capacity) and are looking for continual production refinements and new product developments in order to maximise the opportunities that exist within their individual facilities.

This survey continues to be published in two parts; the second part will deal with the rest of the world outside Europe and North America and will be published in the August-September 2017 issue of WBPI.

The author, and the editor remain grateful to all those organisations and manufacturers which took the time to complete our online enquiry form and to all those other industry professionals who made valued contributions to this narrative.

We are happy to receive all new information regarding capacity changes at whatever time during the year is most convenient: If you have news for us, please do keep us updated.

European Capacity

In central and western Europe, as previously highlighted, we can now report on the Fantoni SpA investment in Osoppo, Italy. The project is to replace the two currently-operational multidaylight presses used for MDF production, and referred to as Plaxil 4 and Plaxil 5, by a continuous 65.5m forming and press line from Dieffenbacher. This line will be known as Plaxil 8. The project is progressing well and has been going ahead as planned.

The two multi-daylight presses together produce roughly 300,000m3 a year. Replacing them will result in a capacity increase of at least 10%. When presenting the project, Fantoni indicated an investment of around €60m.

The new MDF/HDF investments in Pitesti, Romania (capacity 401,000m3) and Vladimir, Russia (capacity 424,000m3) by the Turkish wood based panel and laminate flooring manufacturer Yildiz Entegre Agac Sanayi Ve Ticaret AS, headquartered in Kocaeli, also led to orders for four treating and overlay lines for the mills from Vits Technology GmbH, of Langenfeld, Germany. These are now being installed.

In France, we previously reported an important change in the MDF sector: the sale by Sonae of the Isoroy MDF facility at Le Creusot to Kronospan. Now we can confirm that the last Isoroy MDF mill at Ussel, which was sold to a new investor and the factory management, is now privately owned and stands alone. It is up and running as Panneaux de Corrèze. The transaction was processed as an asset deal, with all business operations and assets being transferred to the new buyer. Management at the Ussel plant was supported in the takeover of assets by a group of investors, including the regional investment fund FCI Limousin SAS, Limoges (France), which acts as a co-investor in major projects which are relevant to the economic development of the region.

In the Iberian peninsula, the Interpanel MDF mill located in Villabrazaro, Spain, formerly owned by Tablicia and then bought by Kronospan Group, is now fully operational. Also strengthening the Kronospan group’s position in the region was the purchase of the 250,000m3/year Unopan MDF mill in Salas a Quintanar, Spain. The company now becomes a powerful player in the Iberian Peninsula to compete seriously with the long-established Finsa group.

The two MDF lines in Mangualde, Portugal, now emerge as one component in the newlyformed Sonae Arauco group and the single MDF line at Valbopan in that country continues to produce its unique and popular coloured MDF for specialised markets throughout Europe and elsewhere . Madibeira (Finsa group) has now fully installed the old Jomar particleboard line, together with the MDF plant, which means that on its site at Neles it can produce particleboard – and MDF (up to 60mm thick), with the steam injection process, and/or Superpan (a mix of particleboard and MDF) for the company’s various markets. Turning to Benelux, western Europe and changing ownerships and trends in the sector, we still see HDF as a substrate for laminate flooring losing volume in western Europe, although in eastern Europe, Russia and Turkey this product is still growing in popularity.

The more recent trend in flooring still appears to be thin vinyl flooring (PVC) – also with a click system. All the major HDF flooring players in Europe are investing in this type of flooring at the moment. Mohawk (Unilin) made the biggest step in this respect by taking over IVC (large in this type of flooring business) and thus becoming the biggest PVC flooring producer in the world.

By doing this, it also came into total ownership of the Spanolux MDF mill in Vielsalm, Belgium, and of Balterio flooring. So at the end of this process, the Spanolux mill, capacity 250,000m3/year, is now owned by Mohawk. This means that Unilin and Spano now operate together as a really significant player in the market.

In the UK and Ireland we see no new investments from the three main players Norbord, Kronospan and Medite to increase capacity, but Medite (Coillte) does continue to pioneer, develop and bring to market various new products.

With its intriguing fibre-modified Medite Tricoya Extreme Durable MDF for external use, the company is certainly making further interesting market penetration, competing in many cases with non-wood elements, particularly in the construction sector.

Updating the news from last year, we can report that in March 2017 Accsys Group announced its entry into a number of agreements to create a consortium pertaining to the financing, construction and operation of the world’s first dedicated Tricoya® wood chip manufacturing plant and sales facility, in Saltend Chemical Park in Hull, UK.

Key partners of the Tricoya consortium include BP and Medite. The plant will produce Tricoya Wood Elements using Accsys’ proprietary technology for the acetylation of wood chips. These acetylated elements are used to manufacture high performance MDF panels. The panels exhibit outstanding durability and dimensional stability, which allow them to be used in exterior and wet area applications once limited to products such as concrete, plastics or metals.

With the added benefits of light weight, sustainable raw materials and a guarantee of up to 50 years above ground and 25 years in ground, these revolutionary panels provide architects, specifiers and designers with an entirely new construction material which allows great design flexibility and endless opportunities for creativity.

Medite Tricoya Extreme was launched in 2012 and demand has outstripped supply consistently since that time. Under the Tricoya® Project arrangements, Medite has agreed an off-take agreement under which up to 40% of the Hull Plant’s design capacity (30,000 tonnes per annum), is to be sold or paid for by Medite.

The €68 million venture will see the construction of a new factory adjacent to BP’s existing acetyls facility. Anticipating an accelerating demand, the consortium envisages constructing the plant in such a way that further capacity can be added as required. Pre-construction engineering and design work for the Hull plant was finished in 2016 and construction is expected to be completed by early 2019.

Italy continues to be caught up in the challenges caused by the ongoing decline in furniture production locally. This, coupled with the construction sector’s reduction in activity because of the economic crisis, has resulted in a fall in MDF production over the last few years, with only a small increase seen in 2016.

However, on a much more positive note from Italy, the Fantoni Group investment detailed earlier in this article signals a belief in, and commitment to, MDF for the longer term. As chairman of the European Panel Federation (EPF), Dott Paolo Fantoni, who has been passionate about many topics relating to the correct evolution of the MDF sector, has laid out and presented an EPF and European Furniture Industries Confederation (EFIC) vision, jointly signed with Mr Markus Wiesner, chairman of EFIC, with the Venice Declaration in July 2016. Titled The Wood Based Panels Industry and the Circular economy , this can be seen in more detail on the EPF website : signed-the-venice-declaration-during-epfs- annual-general-meeting-in-venice-6-8- july-2016.

In Turkey, the progressive dynamics seem to continue strongly. With large markets available both domestically and into the Middle East and former Soviet states, the growth continues. Significantly, and as mentioned previously, the remarkable ongoing investments in Turkey continue, with three more plants having been under construction for start-up in 2016/17, bringing a further 1,120,000m3 capacity. These are Starwood Bursa, 400,000m3; Camsan Bodurlar Adapazari, 420,000m3 – both now operational – and SFC Kronospan, with 300,000m3 , still under construction.

Furniture production trends from Poland, the Czech Republic and Romania were reported to be slightly up in 2016 – all good news for the MDF sector. Homanit (Homann Holzwerkstoffe, Germany) is now producing at its new Krosno site in Poland. The new line is configured with a continuous 8ft x 28.8m press designed for annual capacity of 250,000m3; additional investment has gone into a lacquering and finishing line. The group also operates a 250,000m3 MDF facility at Karlino, Poland.

In the Nordic region (Sweden, Norway, Denmark Finland and also the Baltic countries) there are now no production facilities for MDF, but the influence of a certain well-known Swedish group, IKEA, in terms of global design trends in the competitively-priced self-assembly sector, remains influential and interesting. We understand that MDF will generally be used in IKEA products where very high quality core and faces allow detailed machining and high quality finishing, but weight issues continue to dominate selection of materials.

For certain components, MDF with a density of less than 500kg/m3, which nevertheless maintains high quality, could find favour alongside higher density items of 700kg/m3 and over, for special uses. Also, products produced as sandwich elements (core honeycomb with surface 2.5mm or less HDF) are helpful when weight issues need to be addressed in the final furniture product. The issue of recycling MDF at the end of use remains an important topic of research in this area – still to be satisfactorily resolved, but now evolving with the interesting pioneering developments being seen at MDF Recovery Ltd in the UK.

In Russia, and with changing ownerships in the sector in 2015-16, respected industry newsletter Euwid and other industry experts including WBPI’s Russia correspondent, Eugene Gerden, provided helpful commentary. We have also now included the large MDF mill operated by Egger at Gagarin in Russia that was previously missing from our published capacity tables. Also we see a new investment to the east of the Ural Mountains with an MDF plant for the Russian timber group Pavlovskiy DOK as part of a wood processing combine.

Eighty percent of Russian wood resources can be found east of the Ural Mountains. Nevertheless only 20% of the wood harvested in Russia comes from this region, while a highly modern wood based materials industry has established itself, primarily in the west of the country. This is changing, with the construction of the innovative MDF plant by Pavlovskiy DOK approximately 2,000km to the east of the Urals, thus opening previously unused potential. The plant is to be built not far from Novosibirsk, close to Barnaul, an administrative centre and important transport hub; with more than 600,000 inhabitants it is the largest city in the Altai region.

The main equipment, ordered from Siempelkamp, will primarily be backed by energy saving systems. The press will operate virtually isobarically and produce boards 2.5-40mm thick. Total capacity of this new mill has not yet been fully confirmed but we understand it to be in the region of 350,000m3.

Another investment announced is by Altayles, one of Russia’s leading industry groups. The company recently announced plans for a large-scale plant to produce MDF, to be built in the Altai Krai, one of the largest regions in Russian Siberia, bordering Kazakhstan. The capacity of the plant will exceed 200,000m3 per year. The company plans to produce high density panels, together with fine boards that will be specially designed for the Asian market. Investment in the project is estimated at six billion rubles (US$120m).

Istanbul-based manufacturer Kastamonu Entegre purchased from IKEA the former Pfleiderer-planned Novgorod mill in Russia, which has a design capacity of 495,000m3/year of MDF/HDF. This plant, we understand, is still destined to be built, alongside the existing 565,000m3 mill in Alabuga, in Russia’s free economic zone, Republic of Tatarstan, one of Russia most economically-developed regions.

The company has already entered into an engineering contract with the main technology supplier, Dieffenbacher, but still runs the risk of project suspension due to the ongoing tensions between Russia and Turkey.

Russia has for some time been the centre of attention for panel investment and development in eastern Europe, but with the important political sanctions now in place, trade with Russia is restricted. Whilst this is limiting the scope for traditional suppliers of furniture (such as Italy) to the Russian market, it is actually driving up domestic production, and demand, for furniture in the country.

Updating from last year, we understand that the Rimbunan Hijau 150,000m3/year mill has started production but that, due to raw material shortages, it is currently still not running continuously.

In Belarus, the Mostovdrev, Gomeldrev and Borisovdrev mills are up and running well. The two new mills which were under construction – investments by Kronospan at Smorgon and state holding company Lesbumprom in Vitebskdrev (a very large company in the field of pulp and paper production) – are all also now shown in the main listing.

So, looking ahead for expanded capacity in 2017 and beyond in Europe as whole, we have the lines mentioned: in Russia, the (ex-IKEA) Kastamonu investment in Tatarstan (495,000m3); the Pavlovskiy DOC mill east of the Urals (350,000m3); the Antayles investment in Siberia (200,000m3), and the investment at Vladimir (424,000m3) by the Turkish manufacturer Yildiz Entegre Agac Sanayi Ve Ticaret AS, which also has Pitesti (401,000m3) in Romania. In Turkey itself there is the 300,000m3 SFC Kronospan Kastamonu.

Taking our main table listing from 2015, showing an installed capacity of 24,401,000m3, and then fine tuning information with adjustments, corrections and new capacity already installed in 2016, we reach the total of 26,744,000m3. Then, with the future new mills listed in Table 1, we now have a forecast figure of 28,914,000m3 as the total capacity of the European continent for 2017/18.

North America

Overall, the industry has had an improved year in 2016 with many plants operating at or near capacity. MDF production and sales had a good recovery in the US and Canada last year. Imports into the US of Asian furniture continue and, while furniture manufacturing in North America is growing again, it appears it will be some years before it returns to turn-of -the- century levels – if it ever does.

Housing starts are still improving, the remodelling market remains strong, consumer purchases are growing and hospitality sectors and manufacturing are generally on the up, so, realistically, 2017 should be reasonable in terms of demand by the end of the year.

The re-commissioning and opening about a year ago of the MDF Mill at Pembroke, Ontario, Canada has been successful. Formerly known as ATC Panels Pembroke, the mill now operates as Pembroke MDF Inc, with a rated capacity of 257,000m3. The mill uses high quality wood fibre from the local sawmilling industry and is still, we understand, establishing itself in the market as a new player.

We reported last year that Georgia Pacific had acquired the wood composite, gypsum and Kraft paper assets of Temple Inland; it continues to operate the MDF mills successfully at Monticello and Mount Jewett. Also, all formerly-listed Flakeboard MDF mills in the US and Canada are now re-named Arauco North America in our listings.

The sale of the Medite MDF mill in Medford Oregon by Sierra Pine to Roseburg Forest Products, Oregon, was concluded in Autumn 2015; the mill has operated well under its new owners in 2016. Allyn Ford, CEO for Roseburg, stated at the time: “We look forward to the addition of the MDF product line to our portfolio. The Medite® brand is well recognised in the industry and will be an excellent complement to our current offering of composite products. This acquisition will bring with it a variety of niche products that will enhance Roseburg’s value in the market.

“The Medford plant is a well-run facility and we anticipate a smooth transition. The acquisition represents a key strategic move for Roseburg in our composite panel business”.

The new investment by Swiss Krono in South Carolina, which we mentioned in our introduction, is one of the first new investments in production in the US for some time.

Swiss Krono, one of the world’s leading producers of engineered wood products, under its American subsidiary, Kronotex USA Holdings, Inc, is investing US$230m to build an HDF mill and expand its laminate flooring production, creating 105 new jobs over the next few years. Headquartered in Switzerland, with facilities in France, Germany, Hungary, Poland, Russia, Switzerland, Ukraine and the US, the company employs more than 4,500.

This expansion will allow Kronotex USA to produce 300,000m3 of HDF per year, part of which the company will use itself for flooring manufacture, part of which it will sell to furniture, cabinet, fixture, door and other wood product manufacturers. In total, the project will increase the company’s annual laminate flooring capacity by eight million m2.

We have also learnt that the Langboard MDF mill in Willacoochee, Georgia, is upgrading elements of its production facility. A further 11,000m3 will be added to its capacity in 2017, probably operational in 2018.


To complete our North American overview, in Mexico the theme “MDF – Made in México” becomes a reality. The three new projects we highlighted last year progressed steadily, with all of them becoming operational in 2016. Proteak’s plant in Tabasco and Masisa’s in Durango, along with the start of the third new MDF plant at the end of the year – Duraplay’s in Hidaigo de Parral – means that the process of import substitution of MDF panels in the Mexican market has really begun.

Total nominal production capacity of the new MDF plants will be 700,000m3/year. The main incentive for these three companies, which together have invested more than US$400m in state-of-the-art manufacturing facilities, is the very promising outlook in the Mexican market. Until now, no continuous process plants existed in Mexico and per capita consumption remains very low compared to most countries.

According to analysts, 90.5% of MDF consumed in Mexico is imported, mainly from Chile and Brazil, and as a result, logistics costs represent a significant percentage of the price paid by distributors. This in part explains why the Mexican MDF market is perceived as very under-developed in comparison to countries such as Brazil and Argentina.

In Brazil, apparent MDF consumption in 2013 reached 19.2m3 per thousand population compared to Mexican apparent MDF consumption of 4.3m3 per thousand population in the same year. Also, the Mexican furniture industry is characterised by a comparatively high use of solid wood and plywood in relation to particleboard and MDF.

Perceived opportunities for the future increase of MDF in the Mexican furniture manufacturing industry therefore remain extremely positive.

As part of the Chilean Masisa Group, Masisa Mexico’s investments in the construction of an MDF plant, a coating line (melamine) and the expansion of the already-existing resin plant in its industrial complex located in Durango is a bold project. The new MDF project and the coating line will have a production capacity of 200,000m3/year and 100,000m3/year, respectively.

Masisa has been in Mexico for over 10 years with industrial and commercial operations, developing the MDF and particleboard market for furniture. By investing in a local MDF manufacturing facility, the company will complete its production mix, reduce its costs, and achieve increased logistical efficiency.

What is clear is that for the Santiago-based group – already Mexico’s largest wood panel producer and one of Latin America’s top panel manufacturers – the growing Mexican market has long been viewed as a prime target.

For Duraplay de Parral, a long-established Mexican plywood and particleboard producer with a name for service both sides of the US border, the move into MDF production is truly felt to be a natural expansion. The new plant has been installed within its manufacturing premises in the northern silver mining town of Hidalgo del Parral, Chihuahua; production capacity is 200,000m3 per year.

The company has more than 50 years’ experience in the market of wood panels, currently producing particleboard, softwood and hardwood plywood; and panels with decorative surfaces. With the new MDF plant, Duraplay plans to offer the broadest wood panel line manufactured in Mexico. This investment is also positive news for all the relatively local wood suppliers as this will ensure them long-term sustainable harvesting.


The Mexico City-based PROTeak Uno, (Pro MDF) which specialises in plantation teak and solid wood products, previously unveiled its plans to establish a 280,000m3/year MDF plant in Mexico’s southeastern sub-tropical Tabasco state, utilising eucalyptus wood from plantations in the south of the country. The company has been building the plant on a greenfield site at Huimanguillo, 67km from state capital Villahermosa. It is now operational. PROTeak announced that it has signed a cooperation agreement with FINSA, the largest Spanish producer and seller of wood panels, resins, melamine and veneer, among other products, in the Iberian Peninsula.

FINSA owns 12 plants in Europe with 2,750 employees and annual sales of a US$1bn. The agreement includes the joint operation of PROTeak’s MDF plant, technology transfer, and the marketing of FINSA products in Mexico.

PROTeak has also succeeded in buying Forestaciones Operativas de Mexico SA de CV, (FOMEX), the national eucalyptus plantation business of Mexican industrial conglomerate Grupo Kuo, for a reported US$30m. That FOMEX deal now gives PROTeak FSC-certified eucalyptus plantations in Tabasco and in the neighbouring states of Oaxacap and Veracruz.

PROTeak is investing around US$180m in the Tabasco MDF project overall, including the acquisition of the 8,500ha of eucalypt forest in the state. Apart from offering ideal growing conditions for forest plantations, Tabasco state has a well-developed infrastructure, thanks to the dominance of the oil and gas industry and the state’s location in the Gulf of Mexico.

Looking ahead, the company intends to increase its own eucalyptus plantations to at least 15,000ha, through planting and improved growth rates, over the next four to five years.

This it hopes will not only secure its long-term raw material supply, but also assist in delivering its quest to become the lowest-cost producer in Mexico.

Mexican wood panel producers are now driving several market development initiatives which are gaining momentum and are at the forefront of a campaign to promote wider use, particularly of MDF, by the national furniture industry. The panel makers are continually educating Mexico’s furniture designers (both current ones and young students) and manufacturers in the potential and versatility of MDF which, with its workability, is a natural substitute for traditional solid wood. These three new mills bring Mexico’s MDF total production capacity up to 764,000m3/year as at end-2016 – such a significant change from the small capacity of less than 80,000m3 which had been stable for such a long time previously.

Total North American installed capacity for 2016, is now recorded at 5,727,000m3, building on the 5,037,000m3 recorded for 2015.

Now, with the significant new Mexican capacity projects and the Mexican mills listed in our table showing capacity for 2017 and beyond, we have a forecast figure of 6,038,000m3 as a total capacity for the North American area, including Mexico, for 2017/18.

Business barometer and Brexit note:

The United Kingdom European Union membership referendum, also known as the EU referendum and the Brexit referendum, took place on 23 June 2016. This resulted in 51.9% of voters voting in favour of leaving the EU. Membership of the EU and its predecessors has long been a topic of debate in the UK. The country joined the Common Market in 1973.

A referendum on continued membership was held in 1975, and it was approved by 67% of voters, but this was not then a ‘political union’ as it is today. Time will tell what impact this decision will have on international trading and the movement of goods into and out of the UK.

Regarding European MDF manufacturers again, regretfully, due to insufficient response to our questionnaires, it has not been possible to compile a meaningful business barometer for this region. However, in general, industry experts suggest it certainly seems correct to report that the trend in prices for MDF could be described as continuing gently upward.

So we suggest that the situation in the MDF market across the European region broadly could reasonably be described as very slowly ‘recovering’ on the overall pricing front.

Although we have not published a specific table for the Business Barometer this year, information from North America shows that pricing is strengthening due to the stronger economy and growing demand.

The North American business barometer also now suggests that costs are expected to rise by an average of 2-6%, based on the latest information we have. These industry value changes are a combination of increasing costs and gradual stronger demand, allowing some price recovery across the MDF sector.