More than half of the wood based panel production of the facility in Radauti built by Austria's Egger group will go abroad, says Georgios Natsos, chief financial officer with Egger Romania.
"The construction of this new production facility in Romania can cover the local domestic demand, as well as the demand of other East-European countries. Egger is an international group and has facilities in Austria, Germany, UK, France and Russia. Our reasons for investing in Romania are primarily linked to market opportunities, the local tradition in wood processing, infrastructure, and also to the possibilities to keep growing," says Georgios Natsos.
Egger is currently operating the biggest investment in the domestic wood processing industry, with the Austrian group having earmarked around 500 million euros for a project due to be carried out in several stages.
"The project will have two to four phases depending on the development of the market and of the overall economy. In the first stage, we will invest about 210 million euros," explained Natsos. Investments will be finalised within three to five years, with no other project to be started in the meantime. Sixty percent of the necessary amount for investments were secured from the European Bank for Reconstruction and Development (EBRD), with the financing agreement signed in late 2005. Natsos specified the Austrian group "doesn't have other investments in Romania yet."
Since the end of last year, when construction works for the plant of Radauti started, 35 million euros have been spent of the 210 million euros allotted for the first stage.
"We will start with the chipboard production, the impregnation, as well as the lamination. The major product will be MFC (melamine faced chi pboard) in order to serve the furniture industry. In the next phases we plan to produce OSB (Oriented Strand Board used for floors and ceilings i.e.) and MDF (medium density fibreboard used in the furniture industry i.e.)," says Natsos.
The plot of land the Egger plant will be built on was acquired from another Austrian group operating in Romania, Holzindustrie Schweighofer, and has an area of 85 hectares. At the same time, Schweighofer will be one of Egger's main raw material suppliers.
Production is scheduled to begin at the end of this year, with the chipboard production capacity to reach 600,000 cubic metres. The company currently has 20 full-time employees, but it plans to hire anther 300-400 people by early 2008. Around 95% of employees come from Suceava. Wood flakes from sawmills are the main raw material source Egger uses. Egger's main competitors at a European level are Pfeiderer, Kronospan, Sonae, in addition to other smaller domestic producers. "There's tight competition here, too, but there is enough room for us all on the market," says Georgios Natsos.
Globally, the Egger group last year derived consolidated turnover worth above 1.2 billion euros.
Egger
A family business set up in 1961
One of Europe's main players in the domain of wood based panel production
In 2006 generated consolidated turnover worth more than 1.2bn euros and had 5,100 employees
Its main competitors are Pfeiderer, Kronospan, Sonae
In Romania is operating the biggest investment in the wood processing domain
More than half of production in Radauti will go abroad
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