Insulation industry news from Global Insulation

Australia: The owners of potentially thousands of buildings in the Australian state of New South Wales (NSW) will have to replace their cladding after the government retrospectively banned aluminium panels with a core of more than 30% polyethylene. It is seeking to prevent fires such as those seen in Melbourne's Lacrosse building and Grenfell Tower in London, UK.
The ban, announced by Fair Trading Commissioner Rose Webb, goes further than previous announcements by state governments in Queensland and Victoria that banned the use of high-content polyethylene cladding, as it also affects existing buildings, rather than just those in planning or under construction.
"The building product is unsafe for use in any external cladding, external wall, external insulation, façade or rendered finish in buildings (as low as two storeys, depending on purpose), subject to specified exceptions," said Ms Webb in a communique. "I therefore decided to prohibit the use of the building product."

The number of buildings affected by the ban is unclear. In June 2018, the state government said Fire & Rescue NSW had assessed 2280 buildings and found 417 in need of closer scrutiny. A register of buildings with combustible cladding, drawn up in the wake of an audit conducted by the NSW Cladding Taskforce, is due to come into effect in 2018, but may not be made public.

Under the ban permitted under NSW cladding legislation passed in late 2017, local councils and other relevant authorities will be able to issue rectification orders for affected buildings.

Australia: Kingspan Australia has complained that its can’t compete against foreign competitors due to shipping charges at the Port of Melbourne. Charges at the port have led to the state government to consider taking action. Kingspan says it has conducted an international benchmarking survey across ports it uses, including those in the UK, the UAE, China and South Korea. It found that Melbourne was the most expensive and one of the most expensive ports in the world for terminal handling and port service charges.

Exports comprise a third of the output of Kingspan’s plant at Somerton. Further plans to upgrade the plan depend on its export market. The US$30m plant opened in mid-2017.

Australia: Kingspan Insulation Australia’s Kooltherm K10 Soffit Board FM product has been accredited by FM Approvals. The closed cell phenolic insulation has been accredited with Class 4880 for ceiling applications.

To achieve the FM accreditation, Kingspan’s Kooltherm K10 product was installed in a ceiling for a full scale burn test (UBC 26-3) and set alight. During the test, temperatures, smoke levels and flame spread are all monitored. A burning wood crib was set alight in the corner of the room and left to burn for 15 minutes. During this time, in order to pass the test, the spread of the flame must not exceed the area of the installed K10 test panel.

FM Approvals offers third party testing and certification services including fire tests.

Australia: Kingspan Insulation has implemented an integrated management system (IMS) into insulation plant in Somerton. The system has been adopted to comply with ISO 9001, 14001, 45001 and 50001. The site was audited by SAI Global in July 2017 where it received certification as compliant to all four targeted ISO standards.

Australia: Kingspan says that its Somerton insulation plant near Melbourne is making progress towards gaining a Green Star rating. If it does so it will the first manufacturing plant in the country to do so. Kingspan and the Green Building Council of Australia have collaborated to allow the rating tool to be used for production plants in the country. A Green Star certified rating provides independent verification that a building or community project is sustainable.

Australia: Pricewise Insulation says that it is hopeful that a shortage of pink batts mineral wool insulation products will be resolved following the end of a strike at Fletcher Insulation in late May 2017. Workers at the insulation producer started industrial action in mid-February 2017. Pricewise, an insulation distributor noticed falling stock levels of the product during the strike.

Australia: Kingspan Australia has opened an insulation plant at Somerton near Melbourne. The US$30m plant will manufacture rigid board insulation, including Kingspan Kooltherm a rigid thermoset phenolic insulation. The 14,000m² unit has created 26 new jobs and 24 additional jobs will be added as production increases. Following the opening of the plant Kingspan aims to export 20% of its production to the Asia Pacific region. This is expected to grow to 35% by 2020.

“The market for high-performance insulation is growing rapidly around the world in response to government policies aimed at making buildings more energy efficient. This facility gives Australia world leading technical capability in a sector that is experiencing significant sustained domestic and international growth,” said Gene Murtagh, the chief executive officer of Kingspan Group.

Architect Tone Wheeler designed the plant with a focus on environmentally sustainable design. It has a 750kW solar system designed into its roof structure which, when installed, will provide most of its daytime shift energy requirements. It also uses Kingspan lighting and insulation products to reduce energy requirements and optimise comfort for employees. Other sustainable features at the site include the use of sustainably sourced or manufactured building materials, the use of energy renewing ventilators and the use of rainwater harvesters for bathroom and landscape use. Kingspan says that the plant is on track to be Australia’s first Green Star-rated manufacturing facility.

Australia: Businesses that suffered when the Home Insulation Program was closed are suing the federal government for more than US$72m in compensation. ACA Lawyers and McLaughlin & Riordan have launched a lawsuit on behalf of more than 100 people in the Victorian Supreme Court that alleges the government's mismanagement of the scheme resulted in business loss or forced them into bankruptcy, according to the Australian Associated Press agency.

The lawyers say that a Royal Commission set up following the closure of the Home Insulation Program failed to compensate businesses sufficiently. They allege that it only compensated companies operating before the insulation program was implemented not ones created afterwards to take advantage of it. 104 claims are believed to have been settled at a cost of US$9.7m despite thousands of businesses being affected.

The Home Insulation Program was shutdown in 2010 following the deaths of four workers.

New Zealand: Fletcher Building has reported that its net profit rose by 51% year-on-year to US$114m in the half year that ended on 31 December 2015 from US$75.6m in the same period in 2014. Its sales rose by 2.5% to US$2.94bn from US$2.87bn. It attributed this to growth in its building products and distribution businesses making up for weaker earnings from Formica and New Zealand housing developments.

Fletcher Building reported that gypsum wallboard volumes via its Building Products division rose by 9% in the half year. Volumes of performance board rose by 12%. Sales volumes of insulation rose by 12% in New Zealand and 9% in Australia. It noted that its market share has also improved in both insulation markets due to competitive pricing following the strengthening of the US Dollar.

Australia: Fletcher Building is considering selling its insulation business, which could see the manufacturer of Pink Batts get a new owner. The company said that further asset sales were on the cards, although it did not specify insulation.

"Fletcher Building is undertaking an ongoing review of its business portfolio with a focus on lifting operational and financial performance and pursuing organic growth. The review process invariably leads to speculation on a range of possible outcomes. The company is aware of its continuous disclosure obligations and will promptly communicate to the market if or when there are substantive matters required to be disclosed," said a statement from Fletcher Building.

Fletcher holds its insulation assets, Tasman Insulation and Fletcher Insulation, in its light building products division. Fletcher Building has a market capitalisation of US$3.45bn and it is Australasia's biggest supplier of building and construction materials. These include laminates, cement, pipes and roofing. It has just won the New Zealand International Convention Centre contract in Auckland, as well as the contract to build Precinct Properties' US$396m, 38-level Downtown Tower at the foot of Queen St on the waterfront.

Fletcher Building's Chief Executive Mark Adamson made it clear at the 2015 annual meeting that he had not bought any new assets since starting in the job, but had instead been dealing with the difficult legacy of selling businesses that were either underperforming or not up to expectations. "In my time in the job, we have not made one single acquisition," said Adamson. "I have had to deal with what we have today. Profitability is improving, maybe not as fast as anyone would like."