Wood and Furniture Market News from Europe
¡¾2002.04.10¡¿

Drop in Particleboard Prices

The particleboard market in central Europe still does not show signs of improvement. Unchanged weak demand is weighing heavily on producers but despite the weak demand production volumes seem to be rising.

Analysts point out that output of particleboard still is too high and new production is adding to existing glut in supply. Stocks of particleboard producers still are described as much too high. Short-term market prospects are rather unfavourable.

Starting end-March the industry is expecting further weakening amongst the buyers. The furniture industry, in particular, is planning extensive shutdowns during the Easter holidays. Other consumers too are not showing signs of a revival of demand worth mentioning. Demand on the part of other industrial consumer branches of late has been rather subdued.

European OSB

According to estimates from the European Panel Federation (EPF) in Brussels, last year the European OSB producers achieved a 28% growth in output to 1.6mil cubic metres. European OSB consumption grew by a comparable rate of 29% to 1.4mil cubic metres. Growth was seen in all areas of application developed so far for OSB. Imports of OSB into Europe are still negligible, according to EPF.

Click Systems of Growing Importance

It is the opinion of most European parquetry producers that the competitive pressure on the markets for parquetry has increased again. Because of unchanged high stocks, consistently high production activities as well as weak demand in the European markets, prices have come under growing pressure in the past weeks, especially for standard qualities of prefabricated parquetry. In the opinion of analysts, in the past few months sales and prices in the German market especially are affected by even moer by the introduction of new systems for the gluefree laying of three-ply prefabricated parquetry.

It is expected that production in the prefabricated parquetry industry in Europe would continue on an unchanged high level. While the production of standard qualities with groove/key has been reduced the suppliers of prefabricated parquetry for gluefree laying have expanded their output. In view of a general weakening of demand the existing production capacities are clearly in excess of requirements.

Finish Furniture Sales Up

In Finland, furniture retailing increased by about 3.5% in 2001. The real growth, excluding price increases amounted to just over 1% and the furniture sales totalled Euro 622 million. In 2002, the growth of sales is expected at 3-4%. Imported furniture accounted for more than 50% of domestic sales, with leading importers being Sweden, Estonia, Germany and Italy. The large chains of Isku, Asko, Sotka, Stemma and Europa Moebel accounted for more than 75% of the sales.

Höffner v Ikea in Berlin

German furniture retailer Höffner plans to set up a new store with a sales area of around 40,000 sqm in Berlin Spandau. The overall investment will amount to EUR 40mn and the new site is to attract customers from the Havelland region. Rival Ikea will open a new store close to the planned Höffner site in Berlin in March 2002. A spokeswoman for Ikea said that the new stores will complement one another.

Möbel Krügel insolvent and Hiendl expanding

The German furniture specialist retailer Möbel Krügel, which suffered from the weak German furniture market, filed for insolvency on February 2002, after the sale of group units failed. Meanwhile, the regional furniture specialist retailer Hiendl plans a branch in Augsburg. Hiendl, which took over the furniture store of Möbel Krügel in Rosenheim in autumn 2001, operates larger stores in Passau and Regensburg.

Ikea's Network in Russia

Swedish home furnishings retailer Ikea is planning to build a huge central warehouse in Moscow. The 100,000 sqm, US$ 40mil, warehouse will become a hub for Ikea activity not only in Russia but across central Europe. In addition to the two Moscow Ikea stores and the planned 15-20 new stores across Russia, supplies from the new warehouse can also be delivered to Europe.

Russia is one of the largest suppliers of most of the raw material Ikea needs for its products and has further potential of growth. Russia also has enormous factories from the Soviet times which could offer Ikea the required volumes.

Paloheimo to end Parquet Production

Finnish Paloheimo Group will end production of parquet flooring in Finland, making 120 people redundant. The letter of intent on selling the parquet operations to a Finnish consortium of companies fell through as the company was unable to meet financial preconditions for production within the end of January 2002 deadline.

K & M Möbel Turnover Down

The German Kirchlengern-based furniture manufacturer K & M Möbel AG made a net loss of EUR 15.3mn in 2001 compared with a loss of EUR 4.3mn in the previous year. Turnover went down from Euro 256mn in 2000 to Euro 228mn in 2001. The firm also expects a loss in 2002. K & M Möbel, which cited price competition on the German furniture market, intends to save costs by further restructuring measures in 2002.