Russia’s OSB production to triple by 2020

–          Oversupply “unlikely as robust housing market and exports will absorb most boards

–          Increased production will reduce dependence on imports

By Marina Khaibulina and Philip Chebyshev, Lesnaya Industriya Journal


Russia will likely see six new Oriented Strand Board (OSB) lines operating by 2020 which, at their full capacity, will triple total output from 1.34 million cbm at present to 3.935 million cbm.

These six lines are currently in various stages of construction: One of them is DOK Kalevala’s second line, a planned investment worth 3.2 billion rubles. At full capacity of 300,000cbm annually, the new line will double the company’s production capacity to 600,000cbm. It will be delivered by Siempelkamp and scheduled to begin operations at the end of 2018.

Turkish company Kastamonu initially planned to commission its OSB plant – with an annual capacity of 575,000cbm – in 2007 but postponed it to 2018-2019. Ali Kılıç, CEO of the plant in Russia, is observing the market closely. He plans to relaunch the project in 2018.

He said, “This is a strategically important project for us. We will focus on the Russian market but also plan to market OSB in other countries too.”

Kronoshpan Bashkortostan (part of Kronospan) bought over a line from Oris, which previously planned to build an OSB and large-format plywood plant in the Perm region. Now, Kronoshpan will launch this new OSB line in Ufa this year, with an annual capacity of 500, 000cbm.

Two other companies that plan to start production before 2020 are SibayPlitProm and Ugra-Plit with annual capacities of 570,000cbm and 250,000cbm respectively. While SibayPlitProm has already finished the plant’s design phase in the Republic of Bashkortostan, Ugra-Plit is still looking for investors and other means of financing.

Valery Puchkov, CEO of DOK Kalevala, says oversupply is unlikely as not all announced projects will be implemented until 2020. He also has confidence in the market’s growth as Russia’s wooden house construction and the packaging sector develop – two main consumers of OSB.

“The Ministry of Industry and Trade has proposed that 30 per cent of all houses in Russia should be made of wood. This will help the development of the market. In addition, exports will also continue to grow, balancing out domestic demand,” he said.


Leading exporters and buyers

In fact, there appears to be a shortage of domestic OSB. In 2016, OSB production was estimated at 730, 000cbm. Only large manufacturers could increase production then, compared to 2015. Some planned projects were suspended due to the difficult economy while others stopped production altogether.

That year, OSB imports rose 34.6per cent to 595,500cbm. Products were mainly from Belarus, which made up 75.4 per cent of total shipments. China’s share climbed from 12 to13 per cent to 79,100cbm; German imports were up five to seven per cent, reaching 39,900cbm. On the other hand, Romania reduced exports to Russia by58.5 per cent to 8,100cbm.

Also, in 2016, Kronospan, through supplies from the Belarusian plant, increased OSB sales to Russia by 4.66per cent to 460,610cbm. Chinese company Linyi Consmos increased exports to Russia by almost 29.5 times to 70,800cbm. Glunz AG from Germany also returned to the Russian market, selling a total of 36,700cbm.

In 2016, the Moscow region was the top importer in Russia, with total OSB sales rising 30.5 per cent to 109,200cbmin volume terms. The region’s share of total OSB imports increased by four percentage points to 22 per cent. The greatest increase was observed in theRepublic of Crimea: Almost 20.5 times, to75,800cbm; the region’s share also grew by 15 percentage points to 16 per cent.



Average OSB board prices increased by 5.7 per cent, to 13,365 rubles per cubic metre in 2016. Throughout the year, prices climbed gradually until the end of the third quarter, and then rapidly declined with a smooth rebound towards the end of December. Prices peaked in September 2016 – 17,905 rubles per cubic metre – due to a highly active construction market before the end of the season.

In 2016, the average price for imported OSB increased by 15.1 percent to $179 per cubic metre (2015:$155). Throughout the year, the price for imported OSB was growing, although there were sharp price declines in OSB in 2016 May and August. The highest average price per cubic metre was recorded in October at $227, mainly due to the end of the construction season in the Central Federal District during the period. The lowest average price was $84 per cubic metre, in May, due to the May holidays, affecting sales.

The highest average price recorded was for Linyi Consmos’ OSB at $517 per cubic metre; Glunz sold boards for $315per cubic metre; Egger, $213; the KronoGroup, $190; Kronospan, $181. The lowest import price was on Belarusianboards at $154 per cubic metre.