UNITED KINGDOM FOREST PRODUCTS ASSOCIATION

UK PANEL PRODUCTS SECTOR REPORT

This report, which provides a commentary on the industry and its markets, is based on feedback from UKFPA Members operating in the UK panel products sector.

UK producers of wood based panel products report that demand has been strong throughout the year. However, increasing energy and resin costs continued to have a significant impact across the sector.

The downturn in the US construction sector has resulted in increased availability of USA-produced OSB in the UK market.

A new, £100 million, particleboard plant was completed by Egger UK at Hexham during spring 2007.

As a consequence of greatly increased sawmill production in the UK in the first three quarters of the year, supplies of sawmill chips and sawdust have been plentiful, although the downturn in sawmill activity in the last quarter has inevitably impacted on the supply of these products.

Concerns persist in the panel sector in relation to the potential threat to wood supplies from the emerging wood energy sector.

Report complied 10 January 2008.