Why OSB?

How the Panel of the '90s got so hot

1|-\SB, introduced 30 years ago as \-fwaferboard, would nowadays be better termed "wonderboard."

After sporadic acceptance in the 1970s, steady growth in the 1980s and a Recession-induced drop in the early 1990s, OSB is now one of the industry's fastest growing products. Demand is quickening. New plants are expected to come on line nearly every month for the next few years.

But why OSB? Why is this particular product finally taking off and will the demand continue to skyrocket to keep all ofthese new plants busy?

Story at a Glance Reasons

for the sudden surge in OSB production and popularity ... are too many new plants being built?

Explanations for OSB's sudden popularity include: tile panel products. New uses are constantly being introduced (see list on next page).

In addition, demand for engineered wood products is beginning to take off. and OSB is used to make foam core panels, wood I-joists and laminated beams.

(

I

) Overall panel demand is growing and OSB is one of the most versa-

Upcoming OSB Plants

(2) OSB is an accepted substitute for plywood, and supply of high quality peeler veneer logs required to manufacture plywood is starting to diminish. 'There's the same demand, so we need an alternative solution.

Tolko

H.J.

Wawa,

OSB is the alternative solution," said Dominique Janssens, manager of technical services for the Structural Board Association. "It's made with aspen, which is not of good commercial quality, or with southern pine thinnings."

(3) OSB is attractively priced. A recent check of Chicago Board of Trade figures revealed OSB going for $80 less per 1000 sq. ft. than southern pine plywood.

(4) More builders are finally trying OSB. Resistance to change has been the biggest barrier to acceptance of OSB and its attractive price has convinced many plywood veterans to give it a chance. "Some people, especially the older guys, don't switch that easily," Janssens said. "But due to aggressive pricing, in some pockets, OSB now has a 50/50 share (with plywood). In some markets, it's taken over."

(5) The low U.S. and Canadian dollar in terms of European and Far Eastern currency should lead to increasing exports as well as offshore expansion. Experts predict over 40Vo of new demand for OSB could come from overseas. OSB is a code approved structural wood panel product in North America, Japan and Europe; accepted for packaging and crating in other countries, and used as an industrial panel in an increasing number of other nations.

(6) Manufacturers, realizing the five previous trends, are building

Uses For,OSB

$ Roof Sheathing

* Floor Sheathing

$ WallSheathing

* Fencing S Storage Bins plants at a record pace and, in turn, beginning to aggressively market the product. The fixed costs for building an OSB plant are very high, but the variable costs are extremely low. Raw material requirements are moderate, with margins higher than for other structural panels.

But with industry capacity slated to increase TOVo from I I billion bd. ft. to 19 billion bd. ft. in the next two years, many are concerned that there won't be enough demand to go around. Janssens is not worried. He thinks OSB popularity is just beginning, that it has yet to be completely accepted as a commodity.

"Plants with newer technology will have a distinct price advantage. Older plants will close," said Janssens. "Plywood (production) will taper off, maybe even stagnate."

He believes you cannot have too much of a good thing.

$ Trailer Walls $ Shear Walls & Diaphragms to Protect Against Wind& Earthquakes * Furniture Backs, Bottoms &, Frames S Desktops + Countertops $ Crating + Packaging S Store Display Racks or Stands * Electridal Spools $ PalletS * Trays $ Core for oneitays $ Shelves $ Racks * AirBaniers & :plenumi :l + :Tiudk & Trailer , Liners * Decking (not exposed to weather) * Cabinets * Door Casings & Mouldings (when overlaid) * I-Joist Webs * Stress Skin Panels * Faces forlnsulated Panels * Frames * Stair Treads S Laminated Beams * Temporary Supports * Bracing $ Door Core * Storage:Tanks (with liners) S Temporary Walkways * Chair Backs * Canopies * Sheds