Huber plans OSB capacity expansion

The OSB industry in North America has witnessed an incredible performance during the Covid-19 pandemic.

According to the National Association of Home Builders, OSB prices for 3/8 thick product has soared more than 500% since January 2020, as high demand and shortages conspire to push up prices.

It’s little wonder that OSB producers have been looking to bring idled capacity back on stream and make investments to expand.

In July, North American OSB producer Huber Engineered Woods (HEW) announced plans to build a new OSB mill – its first in Minnesota. The planned mill is expected to create 150 jobs and cost an estimated US$440m to build, with construction work expected to start in 2022.

North Carolina-based HEW already operates five OSB mills across the US and is part of the JM Huber Corporation, founded in 1883, one of the largest family-owned companies in the US with approximately 4,000 employees in more than 20 countries.

The company’s current mills are located in Georgia, Maine, Tennessee, Oklahoma and Virginia. Its first mill in Maine was built in 1983.

HEW chief financial officer and vice-president of strategy Kirk Blanchette told WBPI that the new mill in Cohasset would “be the largest facility within our production operations and will have the most significant impact on our ability to service mid-western and western markets”.

“The new facility will produce HEW’s full portfolio of OSB panel products that have revolutionised the way homes and multi-family projects achieve air and water management in roof, wall and sub-floor assemblies,” he said.

“Our industry is closely tied to housing starts, and the housing industry has seen robust growth throughout the pandemic. We expect this pace to continue, along with the continued demand for our specialty sub-flooring and integrated sheathing products.”

The company has not released a specific capacity for the new mill but it is expected to add 30% to HEW’s manufacturing capacity and would primarily serve markets in the western US.

For it to be the largest capacity mill in the HEW group of mills, the new facility is expected to have an annual capacity of greater than 600,000m3.

According to WBPI’s annual OSB Survey, HEW has an existing OSB group production capacity of more than 2 million m3.

HEW is not yet commenting on selection of equipment suppliers for the project.

COHASSET MILL SITE

The 750,000ft2 new facility will be built on a 400-acre site in Cohasset, Itasca County on land owned by Minnesota Power, next to the utility’s Boswell Energy Centre. It will continue the rich legacy of OSB production in the state, being located less than 10 miles from Grand Rapids, Minnesota, once home to the original OSB manufacturing facility in the US, which was built in the 1970s.

Minnesota Power announced earlier this year it intends to close and convert Boswell’s remaining coal-fired units by 2035.

The location was chosen after a search of sites across the US and Canada. The availability of raw material – aspen – was one of the reasons the company chose the Cohasset site.

State entities are assisting with some of the funding, including US$15m from the Iron Range Resources & Rehabilitation Board, announced by Minnesota governor Tim Walz. In total, state monies going towards the project are thought to be up to US$60m.

“I support and recognise the significance of this project, as does my leadership team,” said Governor Walz.

“Minnesota’s state government commissioners are making the success and expedition of this project a top priority. Huber is an innovative and unique leader in the building products industry, and we are excited they are joining the successful companies that operate and thrive in north-eastern Minnesota.”

Among those involved in the process to bring HEW to Minnesota include the Department of Employment & Economic Development (DEED), Iron Range Resources & Rehabilitation, Minnesota Pollution Control Agency (MPCA), the city of Cohasset, Itasca County, Minnesota Power and Itasca County Economic Development Corporation (IEDC).

“This new chapter of growth for our company is the result of tremendous collaboration between our organisation, Governor Walz and the state of Minnesota including DEED, IRRRB, and MPCA, and the local community, the city of Cohasset, Itasca County and Minnesota Power,” added HEW president Brian Carlson.

The mill will be HEW’s largest capital investment to date and will feature advanced processes and technologies to be the most efficient and sustainable operation within the HEW manufacturing network.

The large cutting capacity of the mill (up to 1 million tonnes of wood per year) will require up to 150 logging trucks daily, while annual transportation of finished OSB will equate to 20,000 truck loads and 330 rail cars.

The manufacturing facility is projected to provide over 150 direct new jobs to Itasca County and surrounding areas, while contributing growth opportunities in connected local sectors.

DEMAND FOR OSB

HEW’s move is ultimately a response to market demands for its specialty products.

The new plant will increase the company’s production of the ZIP System and AdvanTech structural panels.

The ZIP system comprises a structural OSB sheathing panel with an integrated air and water-resistive barrier that delivers moisture and air protection in an easy-to-install system also utilising special flashing tape. AdvanTech is HEW’s main OSB roofing, wall and sub-flooring product.

“We’ve seen a strong start to 2021 and are optimistic for continued growth of our specialty products in the coming years,” said Mr Carlson.

“We are pleased to share our plans for increased production to help keep pace with the growing demands of our customers for ZIP System and AdvanTech products, as well as future innovative solutions that we strive to deliver.

“In addition to the successful launch of several new products at the 2021 International Builders’ Show, this is yet another example of HEW’s commitment to supporting our brands and our growing base of customers nationally.

“We look forward to being an integral part of the community and a key partner in the future success of the county and the state. We are pleased and excited to bring this new investment and set of employment opportunities to Itasca County and the surrounding areas,” he added.

HEW’s manufacturing operations support the growing needs of single-family, multifamily and commercial builders along with select OEM industries.

The company has been busy with investment and R&D of late – earlier this year HEW launched AdvanTech X-Factor, which is a new class of premium sub-flooring with a fade-resistant, water-shedding protective top layer.

At the same time, it also launched EXACOR Magnesium-Oxide (MgO) panels to offer builders a way to provide fire resistance and acoustical performance in multi-family and light commercial flooring assemblies. It can be used as both a sub-floor underlayment over traditional OSB or plywood and as a structural sub-floor.

An information guide to the investment in Minnesota can be viewed at: www.HEWMNmill.com.