Coillte Panel Products focus on a sustainable future

One of the big drivers for Coillte Panel Products’ business in export markets in the coming years will be the demand for timber products from sustainable sources due to increasing environmental regulation and the requirement for more energy-efficient buildings, according to Gerry Britchfield, managing director of Coillte Panel Products.

With this in mind, the company has developed a number of new products, such as ToughPly, which it launched in September of this year at the UK’s premier event for the sector, Timber Expo in Coventry.

A direct competitor to tropical plywood, ToughPly is the company’s latest oriented strand board (OSB) product with no need to prime, zero-added formaldehyde, approval for structural use and at a lower price than alternatives.

“With ToughPly we are building on the requirement for products coming into the EU to come from sustainable sources. We aim to sell it across Europe, replacing some of the tropical plywood products which may struggle to prove their credentials,” Britchfield explains.

One of three divisions within Coillte, the others being Forest and Enterprise, Coillte Panel Products is focused on export markets, selling in excess of 90pc of what it manufactures outside of Ireland. With annual output of 700,000 cubic metres, Coillte Panel Products employs 330 people directly and around 500 indirectly in areas such as freight, manufacturing of resin and maintenance.

“We are tightly interwoven with Coillte Forest, which manages Coillte’s forest estate and supplies us with pulp wood. This is a unique feature of our business as international competitors wouldn’t tend to own forests and our customers value that security of supply,” says Britchfield.

“Our reason for being is to add value to the wood fibre resource. We are competing head on with large-scale panel producers in the commodity space so our aim is to try to move as far away as possible from commodities into value-added products.

“An example of this strategy in practice is Coillte Panel Products’ joint venture with a company called Accsys, owner of the intellectual property (IP), allowing us to convert softwood into a weatherproof MDF product by changing its molecular composition.

“We are working with Accsys to build this technology into a panel product called Medite Tricoya and sell it into applications that it couldn’t go into before because it wouldn’t have satisfied stringent stability and durability requirements. This will be a new departure and a global first,” says Britchfield.

“We have a pipeline of 10–20 research and development projects at any one time and we pick two or three winners out of that each year. Not all of them are going to be potentially game changing. Co-ordinated by our dedicated head of innovation David Murray, we set up small project teams for each product to develop it, drawn from different parts of the business. We feel this is a more effective approach than having a dedicated R&D department.”

In the international marketplace Coillte Panel Products is focused primarily on Europe, but sells into 25 countries globally.

“Our main European markets are the UK, Belgium, the Netherlands, Scandinavia and Germany. With the current eurozone crisis construction demand has fallen by about 20pc peak to trough from 2007 to 2012, so we have developed new markets, such as Russia, Turkey and Mexico to make up the shortfall.”

Coillte Panel Products’ market entry strategy is generally to find a good local partner, which generally tends to be a local distributor looking for a new OSB or MDF product to complement their own portfolio.

“We spend a lot of time trying to find the right partner and when we’ve done that we try to enter a market in a measured way. We don’t want to over-extend ourselves so we try to ensure that both we and our partner will make money.
A key objective is to set up good, reliable shipping routes from Ireland, which can sometimes be a challenge.

“From a standing start a couple of years ago we are now selling significant volumes into Russia and Turkey.”

Coillte Panel Products is a “big export story” within Coillte, but exporting is also important in the other two divisions. “Coillte Forest has worked very closely with our sawmill customers and Enterprise Ireland to increase the footprint of Irish sawn wood in the UK over the last three or four years. UK market share has increased by 50pc, from 4pc to 6pc of its sawn wood imports.

“There is also a potential new export story around renewable energy over the next five years, as the Coillte Enterprise division is working to develop wind farms on Coillte land, which are looking at exporting that energy to the UK.”

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