For this report, we look at particleboard capacities up to the 31st December 2010 in Europe and North America – and find a mixed picture.

As would be expected, given the depressing economic news which continues to emanate from North America, there is little to report from that region (US, Canada and Mexico) and certainly no new capacity planned of which we were aware as we went to press in early September. There were, however, a number of mills that changed ownership last year and some that closed – either completely or ‘moth-balled’ for the foreseeable future.

In the former EU15 countries in western Europe, the story is mainly one of closures, of which there are several, with the exception of some new capacity from Swedspan, which supplies all its production to furniture maker IKEA.

As ever in this region in recent times, eastern Europe shows the most activity in terms of new capacity, while Turkey is also adding some capacity.

The annual report of the European Panel Federation (EPF), launched at its annual general meeting in Poland in June, states that production in Europe overall in 2010 increased by 3.5%, though from a very low level of course; it was still far below the pre-economic- crisis 2007 level and was notcommon to all countries, as some experienced a decline.

Despite a slight decline in output and some mill/line closures, Germany remained the largest producer in Europe last year.

Recovery in production in Europe is expected to continue on a slow track throughout 2011, says the EPF.

In terms of trade, European particleboard saw an upturn in 2010 over 2009, with imports rising 14% and exports by 8.5%, including intra-European trade, reports the Federation.

It also reported that apparent consumption and real consumption rose by 4.4% and 3.8% respectively in 2010, with stocks showing a slight increase between the beginning and end of the year.

The markets in both regions continue to be tough and the ongoing challenges of wood supply threats from the subsidised biomass industries, and ever-tightening formaldehyde emission regulations, don’t help the manufacturers.

In North America, the additional challenge of the boiler MACT emission regulations is another thorn in the side of producers, though positive dialogue between producers’ representatives and regulators does seem to be bearing some fruit.

The CARB regulations are not just an issue for North America but affect any producer trying to sell into that market. These California Air Resources Board formaldehyde emission regulations caused quite a stir initially, but the EPF, following its June annual assembly, seems set to promote its own standard which will exceed CARB requirements in any case.

This survey of the particleboard industry in 2010 shows that aggregate total European and North American capacity increased over that reported at the end of 2009 (WBPI Issue 5, 2010) by a net amount of only 0.18%, solely due to increases in the ‘non-EU15’ countries (+946,000m3), which were somewhat offset by decreases in the ‘EU15’ (-270,000m3) and in North America (-560,000m3).

Many mills in western Europe and North America are still operating below capacity due to the market conditions, but for the purposes of a meaningful survey, readers will understand that we can only give capacity figures for the mills, to allow meaningful comparisons year-on-year.

North America
Any hopes of a recovery in housing construction in the US were dashed once again last year and this trend has continued through 2011 thus far.

With the end (at least for now!) of the government stimulus package and the resultant decline in government spending, coupled with increasing energy prices pushing down spending, the current ‘buzz word’ to describe what the economy is facing is apparently ‘headwinds’.

Slower employment growth, higher costs and stalled income growth are conspiring to hold back any increase in new housebuilding, while existing housing stock is also moving only slowly.

Economic commentator RISI, in its July 11 Particleboard and MDF Commentary, said that “In June of this year, the US economy entered its third year of recovery, but the wood products industry is in its third year of depression”. The report goes on to say that recovery in new home production is not expected until 2013. Bad news for particleboard (and MDF and OSB!) producers.

The USDA Forest Service also points out that the near term is not promising for housing, thanks to continuing foreclosures and the weak job market. The well-publicised issue of US government debt is also expected to hold back housing production of course.

Longer term, the USDA expects an improved picture as, thanks to immigration, it says the US has one of the fastest household growth rates in the developed world.

We have not been notified of any mill closures which impacted capacity in North America in 2010 (remember that this is the year covered by the capacity tables), but for the 2011 capacities next year, we will remove Environ Biocomposites LLC (70,000m3) as we are advised that it closed in 2010.

Roseburg’s Vienna, Georgia, plant also closed indefinitely in October 2010, but apparently remains intact, while its Russelville mill in South Carolina closed at the end of June 2011. It is uncertain whether this plant remains intact or not, so we have left both lines in the listing as they appear to represent existing capacity, but removed their capacities from the total.

ATC Panels’ Franklin mill has been closed since 2008 and so has been removed from our listings.

Similarly, The Waverly Particleboard plant has also been removed as it is reportedly closed and dismantled.

In June 2011, it was announced that Roseburg had bought the Simsboro, Louisiana mill from Flakeboard, which itself acquired the mill in its purchase of Weyerhaeuser assets in 2006. The sale is part of a plan to withdraw from southern US particleboard markets. The name change will be reflected in our survey of 2011 next year.

Sharp-eyed readers will note that Sierra Pine, Springfield, Oregon, was shown as two lines with combined capacity of 425,000m3 last year. Now, the 4ft line has gone and the 5ft-wide one’s capacity has been increased to 301,000m3 as advised to us by Sierra Pine itself. This change is reflected in our 2010 listings.

In another small change to the listings, Boise Cascade has increased its reported joint capacity for its two lines at La Grande, Oregon, from 377,000 to 428,000m3.

Another comes from the fact that the Canadian mill Palliser Furniture of Winnipeg has changed its name to DeFehr Furniture.

Total capacity for North America for 2010 was 11,273,000m3.

EU15 countries
There were a few closures in this region during 2010.

In Germany, Pfleiderer’s Gschwend mill’s closure was announced in October 2010, so it still appears in our 2010 listings but will be removed for 2011; the same applies to its Ebersdorf mill.

Meanwhile, Kronospan announced the closure of its Bischweier mill for good on 20th December 2010.

Also in Germany, Wilhelm Mende of Osterode filed for insolvency in August 2010 and ceased production around the end of November that year, removing 250,000m3 of capacity from EU15 totals for 2011.

In Sweden, ACB Laminat of Brunflo shut its two lines (combined capacity 170,000m3) at the end of 2009. The lines are rumoured to have been purchased and to be destined for the Chuvash Republic in Russia.

Meanwhile, Gruppo Trombini of Italy announced in February 2011 that its Annovati mill in Frossasco was to close permanently, only to announce in late June that it was to restart. It then extended the stoppage to end-September. It remains unclear whether it will restart, or possibly convert to a biomass facility (Euwid 25.2011).

Also in early 2011 in Italy, Fantoni announced that it was to shut its thin particleboard calender mill at Osoppo at the end of March. This is a small capacity mill of 45,000m3 and will be removed from the 2011 listings next year, as will the aforementioned lines in Germany.

Among the other particleboard news items, Egger of Germany bought the remaining shares which it did not already own in Gagarin Plywood’s particleboard mill in Russia in May 2011.

As mentioned in our introduction, Swedspan brought the more positive news to the table with an announcement on its website on April 4, 2011 that its Hultsfred mill was to increase capacity by 200,000m3.

The first phase of this plan was completed in December 2010 with a press extension by Siempelkamp and Swedspan then signed a contract in April 2011 with the same group for a Büttner/SES drier/energy system.

In ‘other Europe’, the company has plans for the construction of a new press line at its site in Malacky, Slovakia and has already purchased an additional six hectares of land there.

The website stated that Swedspan is: “Thoroughly reviewing further investment projects in various European regions. Swedspan’s target is to create an additional 775,000m3 of particleboard production capacity and the options currently being reviewed could contribute significantly to this.

“If all the projects are completed by 2012, Swedspan will reach its target capacity of 2.25 million m3 of wood based panels.”

On a general note, we recorded some mill closures scheduled for 2011 in last year’s table of future capacity changes – Belgium’s Linopan and Glunz of Germany’s Kaisersech and Duisberg mills. They are of course repeated in this year’s table.

Other Europe
Information received has led to one amendment to the listings, with Falc of Hungary’s capacity increased from 300,000 to 450,000m3.

Also in Hungary, Swiss Krono Group closed its Interspan mill at Vasarosnameny in January 2011 (it thus still appears in our listings here, which are for 2010).

In Smorgon in the Grodno region of Belarus, Kronospan FLLC has approval of a €50m loan from the European Bank of Reconstruction and Development (EBRD). This was pending signing as at 26th July 2011 and is for the construction of a particleboard plant of 400,000m3 pa capacity and 10 million m2 of melamine faced particleboard (MFC).

Total cost of the project is said to be around €120m, with completion during 2012.

Turkey has been a source of much activity in both particleboard and MDF in recent years and in late December 2010, Yildiz Entegre bought Yonsan SA’s Maisa plant. It is building a 660,000m3 particleboard plant there for the first quarter of 2012, employing a Siempelkamp line with Pallmann wood preparation.

Several changes shown for 2011 in last year’s ‘Non-EU future capacity changes’ table are of course carried forward to this year’s table.

Total capacity for all Europe for 2010 was approximately 54,596,000m3.