A sound start to the second quarter, even a couple of record months for some sawmills, has given rise to whispers of green shoots for British timber. Imports from Scandinavia remain subdued thanks to a widening price differential of around £25/m3 and the subsequent increase in demand for home-grown means that some mills have been able to continue the destocking that is usual for this time of year.
But with recession gripping UK construction and tens of millions of pounds worth of new capacity coming on stream, how will the industry cope with more and much improved product coming onto a soft market?
As far as Gordon Callander, managing director of James Callander & Son, is concerned the recent rush into investment can only be a good thing. His company has now fully commissioned its multi-million pound greenfield site in Kincardine, West Fife.
"There’s been an investment race ever since I have been associated with timber in the UK," he said. "The whole industry is more competitive, yes, but it’s imports that have always been our greatest competition and we should not forget that."
Tony Hackney, chief executive of BSW Timber Group, said his company was "sweeping up" after the £37m expansion of its Fort William sawmill. "We have invested heavily, replacing obsolete and out-dated technology with state-ofthe- art equipment that has advanced so much in quality and accuracy that we felt we needed to have it, and also to future-proof the business. You can’t run away from a tough market.
"We are selling as much as we have ever sold over the past few years and the idea is to grow market share against imports, but the market conditions aren’t normal," he added. "I don’t know when the upturn will be, we can’t predict that, but we are weathering the storm."
Bishop’s Castle-based fencing and pallet manufacturer Charles Ransford & Sons has also invested in its business, and seen a record April, three successive months of sales in excess of target and an all-round increase in levels of enquiries (TTJ April 20/27).
"In the last two years we’ve made substantial investments in advanced sawmill technology including, most recently, a new feather-edge line, so it’s gratifying to see the whole mill working to capacity," said operations director Alistair Evans. "All the signs are that the market is improving generally."
Incising debate
One technology, though, has divided opinion. Some consider incising equipment for ground contact timber an important factor to achieve the new BS 8417 30-year desired service life ground contact specification likely to come in to effect next year. Those unsure about scoring the timber to increase penetration of treatments argue that the method remains unproven, that the equipment is too expensive and unable to handle volume throughput and that it ruins the appearance of the post.
For Shropshire sawmiller Hales Sawmills, which recently gained planning permission to go ahead with a £3.5m expansion at a new site in Market Drayton, incising is a key investment (TTJ May 4/11). It has set its future in Noisestop acoustic fencing as an added-value product alongside sales of field gates, general fencing, sawn timber, construction timber and decking.
"We decided we would have to go into something special and added value if we were to increase our business and acoustic fencing was the sector we chose," said director Julian Parton. "It has given us a lift. We are doing projects all over the country and in Ireland. We are quoting everywhere."
Hales is now taking delivery of the first Excalibur incising machine developed by Tweddle Fabrications in Cumbria with Lonza Wood Protection. It is one of three mainstream UK machines on the market joining the Hedgehog, which was developed by Walford Timber and is being marketed by Osmose, and the Porcupine, which was developed by BSW Timber and machinery manufacturer AV Birch.
"If the treatment people, the experts, say that is what we have to do to get the preservative into the timber, I want to do it," said Mr Parton. "If we don’t, customers will move away from timber."
James Davies Ltd, a family-owned business based on a 10-acre site at Abercych in the Teifi valley in south-west Wales, is about to place an order for incising equipment, almost certainly the Excalibur. About 80% of the sawmill’s business is fencing.
"In my opinion we would like a little clarity on the issue such as field trials, which we don’t have, but when one does it, we all have to follow or you will be out of the game," said director Quinton Davies. "I can’t say we have never had a customer return to us, but speaking to the people we deal with, fence posts are not a problem for them."
In recent years the company has spent on kilning, resawing and planing, and is to invest later this year on the sawmilling side. "We have invested in the added-value side of our business. We do some carcassing, we make boxes, that kind of thing. Sales picked up in March and April, and are on a par with last year, and we are working at full production."
James Callander, however, is delaying any move into incising equipment. "We have considered incising and bitumen at ground level – the Postsaver sleeve approach – but we don’t do round posts and we haven’t had any of our customers coming to us to say their posts have failed. For the time being I don’t see incising as something we will be doing," Mr Callander said.
BSW, which jointly developed the Porcupine, has two machines and believes the post must remain a premium product. "The throughput isn’t quick, but that’s because it needs to be done right," said Mr Hackney. "These are version one machines, and better machines can be built if the demand is there."
Graham Blyth, senior manager for sales at James Jones & Sons, is in no doubt. The company is one of the UK’s largest timber fencing product manufacturers and has a major incised post contract with Grange Fencing (TTJ October 13/20, 2012). "The introduction of incised posts is one of the most significant developments the timber trade has seen since the move to kiln-dried carcassing," said Mr Blyth. "We’re some way off seeing incised posts in every merchant throughout the country, but the key message of product performance and material integrity is getting through."
Export prospects
James Jones completed a 10-year development plan with the commissioning of its large log line at Lockerbie and is targeting an 8-9% increase in capacity this year. Mr Blyth said the company was actively exploring all market opportunities, including exports.
BSW sees exports as a key market, with Fort William up to single shift capacity by mid- June and a decision to spend £12-14m on a second sawmill and kilning facilities in Latvia.
"The profits from Latvia were limited by the exchange rates and the desperate state of the UK market," said Mr Hackney. "So we started to develop new markets for Latvia, moving toward China, Japan and Dubai, and through that we have built relationships with export agencies and thought: why not export from the UK? We started investing in exports ‘at cost’ and now we are getting a lot of interest."
However, the domestic market remains key. "For too long the UK market has been considered 3×2 or 4×2; now kilning, planing and grading has got us a high quality product and it’s sustainable," said Mr Hackney.
One of BSW’s latest products is its brushwood-finished decking and beams, tongue and groove boards, and cladding in its Timeless Timber brand with increased emphasis on the use of home-grown species, particularly larch and Douglas fir.
For James Callander, alongside traditional markets and offerings, its sawmills are now producing KD carcassing and construction timber. "It’s fair to say the latter half of last year was particularly dreadful and it has been better recently. I think there are some green shoots out there and I have no reason not to think it will be sustainable," said Mr Callander.
Charles Ransford has also diversified to find new customers and new markets. It has completed the installation of a Stenner resaw line for volume output of feather-edge boards and Brodbaek handling technology in a new building.
"2012 was probably the toughest year we have had since the recession began, but we are outselling our production now," said purchasing director Craig Leitch. "We are customer led rather than production driven; we don’t chase the market down on price. Home-grown has been able to take a larger share of the market and we are optimistic about the future."
