Tuesday, August 27, 2013
European laminated flooring sector suffering from over-capacity and competition, reports ITTO (International Tropical Timber Market Report). Europe’s laminated flooring sector, while still dominant in global terms, has been struggling during the global financial crises.
In addition to declining consumption, the sector has come under intense competitive pressure from manufacturers in other parts of the world, particularly China. The laminate flooring sector is also suffering from overcapacity which has put considerable pressure on prices. While consumers benefit from very low prices, retailers now need to shift huge volumes in order to profit from sales of laminate flooring. As a result distributors are looking for higher margin products. At present there’s growing interest in which are increasingly viewed as offering a better combination of quality, value and margin.
The European laminate flooring industry is responding, partly through down-sizing, partly through development of new higher value product lines, and partly through marketing efforts emphasising the specific performance and environmental benefits of laminate flooring.
The laminate market has become split between the low-end product selling for less than euro 10 per square meter and the upscale product that offers bevelled edges, hand scraping, wire brushing and exotic designs priced in excess of €20 per square meter. At their annual meeting in June 2013, the Association of European Producers of Laminate Flooring (EPLF) discussed the global laminate market noting that, in their estimation, China recently overtook Germany as the largest single manufacturer of laminate flooring in the world.
EPLF estimates that of total global production of around 870 million m2 in 2012, China contributed 243 million m3 (28%) and Germany 234 million m2 (27%). However taken together, the 22 member companies of the EPLF (all located in Europe including Turkey) accounted for 460 million m2 in 2012, 53% of global production (Chart I). EPLF data shows that sales of laminated flooring by EPLF members fell sharply during 2011 and 2012. During these years, low and declining sales in Europe and North America were only been partially offset by increased sales to Turkey, Latin America, Asia and Russia. During the first quarter of 2013, overall global sales by EPLF members stabilised at the lower level achieved in 2012. This year sales have continued to decline in Germany, France, the UK, the Netherlands, Spain, Austria, and the USA. However rising sales in Sweden, Italy, Latin America and Asia have been just sufficient to offset weak markets elsewhere.