Norbord completes the final phase of £25m investment in Cowie plant
Published: 13 July, 2011
COWIE: Engineered wood-based panel manufacturer, Norbord, has completed the final phase of a £25million investment programme at its site in Cowie, Scotland.
The investment improves and extends the particleboard operations and includes the replacement of a forming station and pre-press components.
Karl Morris, managing director of Norbord Europe, said: “The installation of a state-of-the-art continuous press has already allowed us to considerably grow our market share in flooring and other construction-related products.
“Work continued on a “24 hours a day, seven days a week” basis while the forming stations were replaced and the new forming bins installed.
“The completion of the final stage of works has provided us with added operating flexibility, a broader product mix, further quality improvements, capacity growth of over 10 % and a reduction in total manufacturing costs.
“These cost reductions are important as we strive to partially offset rising wood costs which are under pressure due to strong competition from the energy sector.”
Norbord currently employs more than 250 people at its Cowie plant and a further 120 at a sister site in Morayhill near Inverness. It also employs in excess of 400 people at its plant in South Molton, Devon.
This latest investment comes at time when Norbord and the wider wood panel industry faces sustained buying power competition from the heavily-subsidised energy sector.
Wood panels, a vital component in the construction industry and in furniture manufacture, are produced from virgin and reclaimed wood – the same materials which biomass energy plants are being incentivised by the Renewables Obligation (RO), through subsidies levied on consumers, to burn. Unstemmed, the demand for wood is set to outstrip supply by a factor of four or five fold, with imports making up the balance.
Electricity generators, purely as a consequence of these RO subsidies, can afford to pay more than double the price currently paid by the wood panel industry for its primary raw material. This has distorted the market and resulted in wood panel manufacturers seeing an average wood price increase over the last five years in excess of 60 %, a trend which will only continue and accelerate.
Karl Morris believes that the Government’s strategy is putting too great an emphasis on large scale wood-fired electricity-only generation and is threatening to destroy the wood panel and many associated industries across the U.K. In addition, perversely, the subsidies, which are funded by billions of pounds from energy bill payers, could have the consequence of increasing CO2 emissions.
He said: “We are not anti-biomass and, indeed, as an industry we have pioneered the burning of our process-derived wood residues to generate heat and power, which is then fed back into our own manufacturing process.
“This £25million investment in plant infrastructure demonstrates our continued commitment to growth and protecting jobs within our plant as well as the forestry industry across Scotland.
“Although we have received backing by MPs and a wide range of other organisations and individuals, it’s vital that political decision makers now begin to listen seriously to our calls for more responsible use of wood and to create a level playing between ourselves and our competitors across the energy sector.”