Insulation industry news from Global Insulation

Finland: Following negotiations with staff Paroc has decided to shut down its Oulu stone wool plant in July 2017. The closure will involve the transfer and centralisation of support functions currently in Oulu to other Paroc plants and locations. Production of building insulation will be moved mainly to the Paroc plant in Parainen and support functions will be moved to other Paroc locations. 64 members of staff will lose their jobs, including all of the production workers at Oulu, and five staff will be moved to other locations.

“The decision to shut down the factory was difficult due to the considerable impact it will have on the personnel. However, the utilisation rate of the current capacity of Finnish stone wool factories is too low to ensure competitive operations in Finland. The factory located in Oulu is old and, in addition to the already high cost structure, continuing operations would require significant investments in the near future,” says Kari Lehtinen, chief executive officer of Paroc Group.”

Denmark: Bjørn Høi Jensen, the chairman of Rockwool, has announced that he will not be standing for re-election at the company’s annual general meeting in April 2017. He said that as he had met his goals to review the management group, start a new growth plan and introduce an ‘extensive’ improvement in results that he was standing down earlier than planned. He originally became chairman in 2014.

Rockwool’s external net sales for its insulation division dropped by 2% to Euro1.63bn in 2016 from Euro1.66bn in 2015. In local currencies the company calculated a slight rise of 0.7% for its net sales. However, its overall profit nearly doubled to Euro166m from Euro90m and its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 21% to Euro389m from Euro322m. It blamed the poor sales on the industrial and technical insulation industries and the slow development of construction in Russia in both new build and renovation. In a statement Jensen described 2016 as a year ‘marked by tough conditions.’

The insulation and building materials producer also announced that it was planning to build three new production plants including a stone wool factory in Mississippi, US. Land acquisitions for the projects are expected to be completed in 2017.

Thailand: Eastern Polymer Group is set to spend US$2.8m upgrading its Aeroflex insulation production lines with automation technology. The investment is part of a total of US$14.3m being spent by the company on cost efficiency, according to the Bangkok Post. It previously spent US$11m in 2015 towards improving production costs in order to increase its profit margin.
Deputy chief executive Challeo Vitoorapakorn said that, although Aeroflex demand had slowed over the past few years, the company is expecting the construction industry to grow in 2017.

Germany: Saint-Gobain has purchased the Augustdorf glass plant in North Rhine-Westphalian from Teuto-Glasveredelung. The unit produces thermal insulating glass products as well as sound-insulating glass and other glass products. The purchase is planned to be completed in March 2017, subject to approval by the government.

Turkmenistan: The Turkmen Industry Ministry has extended a tender for construction of a thermal insulation plant in the Turkmenbashi district of the Balkan region. Bids will be accepted until 7 March 2017, according to the Trend News Agency.

UK: The British Rigid Urethane Foam Manufacturers' Association (BRUFMA) has called for the government to ensure that any new house building campaigns deliver energy efficient buildings and continue to increase the building standards for the sector. BRUFMA was responding to the publication of a White Paper or government report on the local market entitled ‘Fixing our broken housing market.’ The association recognised that the White Paper highlighted a need to continually review the current energy performance standards with regard to climate change targets and to domestic fuel poverty. It added that this should be extended to include the performance in flood risk areas of housing and the materials used in their construction.

‘The White Paper launches a consultation with a range of recommendations to increase numbers of homes being built in the UK. However, there are likely to be many conflicting views so I hope the government doesn’t use this as a way of kicking the problem into the long grass. However many houses are built we must ensure that all new housing is highly energy efficient in line with our climate change objectives. Just because there is a rush to build shouldn’t be an excuse to lower the quality of the thermal performance. And we certainly don’t want to have to come back and retrofit in 20 years because the houses we build today do not meet tomorrow’s requirements,” said Simon Storer, the chief executive of BRUFMA.

Belgium: BASF has increased the methylene diphenyl diisocyanate (MDI) production capacity to 0.65Mt/yr from 0.56Mt/yr at its Verbund plant in Antwerp. MDI is used to manufacture polyurethanes, which are used in insulation production and other materials.

Kyrgyzstan: The Russian-Kyrgyz Development Fund plans to expand a thermal foam insulation plant at Besh-Kungei in the Chui region in 2017. The project will cost US$1.67m, with 66% of the funding provided by the Russian-Kyrgyz Development Fund and the remainder by local businesses. The upgrade is part of a umbrella of investments being made by the fund in 2017.

Finland: Paroc Group is planning to shut down the operations of its stone wool plant in Oulu. The decision has been blamed on overcapacity of Finnish production without a similar increase in consumer demand. The plan also includes transferring and centralising support functions to other Paroc factories at other locations. Approximately 70 workers at the site will be affected by the decision and negotiations are on going.

“Starting the cooperation negotiations is very unfortunate. However, the utilisation rate of Finnish stone wool factories’ current capacity is too low to ensure competitive operations in Finland. The factory located in Oulu is an old one, and, in addition to the already high cost structure, continuing its operations would require significant investments in the near future,” said Kari Lehtinen, chief executive officer of Paroc Group.

Russia: TechnoNicol has started operation at a Euro105m mineral wool plant in the south of the Rostov region. The new unit will produce four types of rock wool products. Future plans for the site include the production of pipe and roof insulation and exports to markets in Armenia, Georgia, and Azerbaijan.