Insulation industry news from Global Insulation

UAE: Knauf Insulation Holding has announced the signing of an agreement with Exeed Industries to acquire a holding in their subsidiary, Exeed Insulation which will operate as a joint venture between Exeed and Knauf, under Knauf Insualtion management.

Exeed Insulation currently operates a newly built glass wool insulation plant in the ICAD 1 Musaffah in Abu Dhabi. In addition to assuming management control of the business, Knauf Insulation will bring its production experience and technology, including ECOSE Technology, to ensure that the plant produces the highest quality mineral wool and becomes the lowest cost mineral wool plant in the region. Knauf Insualtion will also provide product development and marketing expertise to ensure that the business can meet all the current and future needs of specifiers, distributors and contractors throughout the Gulf Cooperation Council states.

Following completion of the transaction the business will be renamed Knauf Exeed Insulation and will be managed by Thorsten Dambly, formerly General Manager, for Knauf Insulation in Austria and Switzerland.

US: Knauf Insulation has been granted a building permit to construct an US$8.7m warehouse and logistics facility in Shelbyville in the US state of Indiana. At a tax abatement hearing, local attorney Lee McNeely, who represented Knauf, told the Shelbyville Common Council that the building is part of an expansion that will bring back a major line producing light fibreglass to the insulation producing plant, known as the 602 line.

"The warehouse will replace an old manufacturing building," said Joey Viselli, vice president of marketing for Knauf. "It just gives us a lot more flexibility to have a warehouse on site," he said.

The building was the subject of a tax abatement request in November 2011, which was granted by the council. According to the tax abatement documentation, Knauf plans to tear down an existing building and then build the new 285,000ft², pre-fabricated metal warehouse and office space. Knauf's main US office is located in the same town.

The abatement documentation further added that, "Knauf intends to demolish an existing structure and build a new warehousing and office facility in order to support additional production for a growing customer base."

Knauf reported the total cost of the project to be US$10.9m. The City of Shelbyville permit is for US$8.7m in construction. The project is expected to add about eight jobs, creating an additional payroll of US$319,000.

In June 2011 Knauf closed its plant in Lanett, Alabama with the loss of 146 jobs. At the time, a company spokesman had said that Knauf was affected by an ongoing slump in housing construction. Viselli said that the closure of the Alabama plant is one element that changes the demands placed on the Shelbyville location.

Ukraine: Knauf Insulation Ukraine has announced that it intends to increase its share of the Ukrainian fibreglass market to 35% in 2012. The company's 2011 market share was 30%.

"In 2012 the company expects that the thermal insulation materials' market will keep developing and Knauf Insulation Ukraine plans to shore up its position and occupy at least one-third of the fibreglass insulation segment," said company director Andrii Pavlik.

In the long-run the company intends to further develop the Ukranian market and advertise the benefits of the material to Ukrainian consumers. In the future the company intends to open its own heat insulation production plants in Ukraine, but this plan is currently on hold due to the economic downturn. The company has long-established plans for a production site in Fastiv, Kyiv Region, obtaining all necessary permits for the project.

"The economic downturn adjusted the development of Ukraine's construction sector and, consequently, our plans for realisation of the project. As soon as the construction industry demonstrates stable growth I think we will be able to begin building our factory," Pavlik said.

UK: A Euro230m government energy-efficiency scheme which aims to refurbish 14 million homes in the UK has been criticised for putting millions of homeowners in a worse position.

The Green Deal announced on 24 November 2011 will allow homeowners to take a loan to install insulation or other energy-saving measures from October 2012. It is intended that the bill savings from the measures will be larger than the loan repayments.

"But millions of hard-working households will lose existing subsidies for insulating their home and will have to borrow the costs of insulation at commercial rates instead," claimed Steven Heath, of Knauf Insulation.

Although subsidies remain for the fuel poor, Heath said that households struggling to pay rising fuel costs would be adversely affected. "The Green Deal initiative needs to be revised to ensure a sensible, effective transition over the next five years from current green energy subsidies," he said.

The Green Deal proposals allow for up to Euro170 to be given as a cashback offer to homeowners, but that is added to the loan. Richard Lloyd of Which? said, "It's crucial that the Government gets the Green Deal right. If it's not good value for consumers overall, short-term incentives will not be enough."

At the launch of the scheme Energy and Climate Change Secretary Chris Huhne said, "We want the Green Deal to be a game changer for British consumers who've been buffeted by global energy prices." It is hoped that the Green Deal will kick start around Euro16bn of private sector investment over the next decade until 2022.

US: The Environmental Claims Service of UL Environment (ULE) has certified that Knauf Insulation's products contain 55.7% of post-consumer waste.

"As one of the first manufacturers in our industry to work with ULE on this type of initiative, we are proud to announce the validation of environmental and sustainability claims for our glass wool products," said Scott Miller, director of sustainability at Knauf Insulation. "Independent, third-party validation provides our customers with confidence in the sustainable attributes of our insulation products. Knauf Insulation, as a company, will continually adapt to the constantly changing atmosphere of environmental sustainability and stay in the forefront with our sustainability platform."

Steven Wenc, president of ULE, said, "We applaud Knauf Insulation for their commitment to diverting waste to make insulation. Knauf Insulation is also committed to building confidence and trust in the marketplace by validating their claims with an independent, third party."

US: Knauf Insulation, a manufacturer of fibreglass insulation used in new homes, is halting production at its plant in nearby Lanett, Alabama a move that will see layoffs for 146 employees. Joey Viselli, Knauf's vice president of marketing, said that the 800,000ft² facility would be shuttered because of the continued and extreme downturn in demand in the home construction sector.

The workers impacted by the move will be will be paid through to 18 August 2011, according to an official notice filed with the Alabama Department of Economic and Community Affairs. Workers were informed of the closure on 14 June 2011, with most being released from their jobs immediately.

"The building economy has taken a turn for the worse in a fairly dramatic way," said Viselli. "At the peak of the market, (the industry was) starting about 1.7 million homes a year in the US. This year we'll be lucky to start 500,000 homes." A report released last month by the US Department of Housing and Urban Development and the US Census Bureau showed privately owned housing starts were at a seasonally adjusted annual rate of 523,000.

Viselli said severance deals would be offered and that some workers will be given opportunities to relocate to other Knauf facilities in Shasta, California and Shelbyville, Indiana, where Knauf Insulation North America is headquartered. He added that there were no plans to sell the Lanett plant at this time.

"It is a difficult decision to mothball a plant," said Mark Andrews, CEO of Knauf Insulation. "It is our sincere regret that we must take this action at this time. We will re-examine the status of the Lanett facility as market conditions change."