Ligna, technology…

… and not only, though the business of machinery and plants for woodworking and furniture production is the core of the Hanover exhibition. An event not to be missed, opening up from 6 to 10 May.

We have already poured tons of ink about Ligna 2013 in our magazines. In the previous issue, we offered a comprehensive review of what is awaiting us from 6 to 10 May. In these pages we want to focus on specific information to complete the picture, after summing up the topical news, starting from the fact that the German May will be opened by Ligna, followed two days later by Interzum, the biennial exhibition of supplies, semifinished materials, components for the furniture industry, to be held from 13 to 16 May.
Together, the two events will be once again a sort of encyclopedia of the wood supply chain, all you need for wooden houses, upholstery, furniture, interior decorations and a hundred thousand products created with wood and wood-based materials. A key reference from forestry to the packaging of finished products.

SOME FIGURES
To give you an idea of what Ligna is, here are some figures, starting from 1,700 exhibitors, a bit more than 50 percent coming from 50 different countries, distributed over a total exhibition surface of 130 thousand square meters. They will get in contact with some 90 thousand visitors from 90 countries, these were the attendance figures of the latest edition in 2011. We will see if the crisis will have an impact on attendance. One thing is sure: as usual, organizers have done their best to bring an adequate number of actors and spectators to the stage of Ligna.
Talking about Italy’s participation, the Italian delegation will be – as usual – the biggest: this year there will be 287 Italian exhibitors, compared to 314 in 2011, on a total area of 22,500 square meters (compared to 24,800 in 2011).
We will stop here, referring those who want more detailed information to the report we published in our previous issue, easily accessible online at https://www.xylon.it/riviste.asp.

A LOOK AT THE INDUSTRY
At the presentation of the exhibition to the Italian press, we got directly from Bernhard Dirr, managing director of Vdma Woodworking machines, a rich set of figures and information about the industry.

“Anyone who thinks they can get by successfully with simple machines in the growth markets is in trouble”, said Dirr. “Production cost increases of ten to twenty percent in countries such as China, along with rising technical requirements, explain the growing demand for high-tech machines and facilities in emerging markets”. And he added: “The need for intelligent facility designs and flexible, automated machines will continue to grow with our customers’ own experience curve. We see rising demand around the globe for technologies that are already successfully used in established markets such as Germany.  This trend is sure to continue”.

RESULTS AND OUTLOOK
Dirr also gave a preliminary balance of 2012: “After a lively 2011 the sector has stabilized. Based on current estimates, German woodworking machine manufacturers’ sales in 2012 were stable. Suppliers of primary processing equipment probably achieved slightly more than the industry average in 2012. Suppliers of secondary processing equipment registered high growth rates in 2010 and 2011, resulting in a significantly stronger benchmark”. So, a slight reduction in sales is to be expected in these segments.

And what should we expect for this year? Can we hope that something is going to change in 2013? The Vdma manager was clear: “The association expects continued growth in 2013 in the low single digits. North America and Eastern Europe will ensure further growth and hopefully more than balance out the continued weak demand in certain Western European countries.
One strength of German mechanical engineering is its global sales structure. This makes us less susceptible than other supplier nations to regional variations in demand.
This year Ligna is once again providing an additional push for the industry at just the right time. We’re eagerly looking forward to see the Hanover fair gates open,” announced Dirr with optimism.

2012 EXPORT
In Milan, they also talked about German export, reporting that German woodworking machines dropped by two percent to 1.5 billion Euros in the first ten months of 2012. With the exception of presses , almost every segment registered a slight decrease. The largest reductions were in exports to Asia (minus 17 percent), the growth driver of previous years. Europe (plus 5.4 percent) and North America (plus 7 percent) registered particularly positive growth. In terms of individual countries, Russia was the leading export market in 2012, replacing China. Russian customers purchased machines from German manufacturers for a total of 177 million Euros, a 28 percent increase from 2011. Following in second and third place are China (175 million Euros, plus 11 percent) and Belarus (93 million Euros, plus 431 percent). The strong growth in exports to Belarus is primarily due to investments in the wood processing sector.
According to Dirr “…the outlook for the US market continues to be positive, with growth of 19 percent. The turnaround of the real estate market is not only impacting the price of sawn timber, but also machine sales”.

Let’s come to import, which rose by two percent to a total of 286 million Euros in the first ten months of 2012. “China is by far Germany’s largest supplier, despite the unfavorable currency exchange – Dirr noted – with a volume of 81 million Euros, basically stable versus 2011. Next come Italy at 48 million Euros (plus 53 percent) and Austria at 42 million Euros (plus 23 percent)”.

MARKETS OF THE FUTURE
Dirr also offered an analysis of the most interesting markets in the near future. First of all, he made a distinction between demand in mature markets, where the only way to grow is pushing innovation and replace obsolete plants, and demand in emerging markets, where growth is driven by new needs.
Another factor to be taken into consideration is the declining importance of Europe, especially Western Europe, which is no longer the hub of big global trade flows, while Eastern Europe is getting more important.
There will be opportunities in Asia and South America, where growth rates are very interesting. In North America, the trend seems to be the same as in Western Europe, i.e. progressive decline.
German companies see the best opportunities in the short and medium term in countries with massive development potential. We are talking about Russia, Belarus and Turkey in Europe; Brazil and Colombia in South America, and China, India, Vietnam and Indonesia in Asia.

Dirr then added some general remarks, pointing out that it is not really true that emerging countries are looking for entry-level or mid-range technology. “There is no single recipe to be successful in these countries”, he said.
“Too many people believe that you can or you must export only mid-tech and low-tech solutions to these regions. That’s not true. Our experience indicates a strong demand of high-level technology, because also in emerging countries, the costs of energy, raw materials and labor are constantly increasing. So, even there, it is essential to focus on energy and resource efficiency, pursuing higher levels of automation.
At the same time, there is a growing demand of goods and products with better and better quality and design. This translates into a new focus on modern production technology, feeding interest in made-in-Germany solutions, to develop new ways of doing business and build stronger and stronger local value chains“.

To complete the picture, we add that German woodworking machinery manufacturers are global leaders, with an industrial system consisting of 200 companies, 17,500 employees and a production value for machines and tools close to 3.4 billion Euros.