Brussels , 22 February 2006

PRESS RELEASE

Panel manufacturers concerned about rising production costs

Dear Sir, Madam,

Attached please find a new press release of EPF to inform you about the recent EPF general Assembly, held on 8 February 2006 in Brussels .

We would be grateful if you could make a publication on the basis of this press release in your newspaper/magazine.

For more information, please contact the EPF General Secretariat:

Tel. +32 2 556 25 89 - Fax +32 2 556 25 94 - E-mail: info@europanels.org

We hope to have been of help to you with this information and look forward to receiving copy of your article on this subject. Meanwhile, we remain,

Yours sincerely,

Kris Wijnendaele

Secretary General

The European Panel Federation organised its General Assembly, on 8 February 2006 in Brussels in conjunction with the exhibition “Tackle climate change: use wood” in the European Parliament. The European panel producers were pleased with the better results obtained by the industry during the last three months of 2005. Following a weak third quarter, the European panel industries are back on a growing track although they have to deal with increasing costs.

During their gathering on 8 February 2006 in Brussels on the occasion of the exhibition “Tackle climate change: use more wood” in the European Parliament, the EPF members were pleased to note that the difficult year 2005 ended with a positive note thanks to the good results in the fourth quarter and which seem to continue into the first months of this year. However, the European panel manufacturers are very concerned about the increasing production costs, as all parameters (wood, energy, resin, transportation,…) are on the rise.

The particleboard producers experienced a difficult first and third quarter, but achieved much better results during the fourth quarter. However, the good year-end could not amend the relapse of the whole year. On an annual level, first estimates indicate that the production shrank with some 1.5% while the consumption decreased with 4% compared to the exceptionally good year 2004. However, production and consumption in 2005 remained higher than in 2003 and before. For 2006, European particleboard producers hope to prolong the flare up of the year-end. The improvement of the European construction forecasts nourishes this hope.

Also the MDF manufacturers had to deal with a decreasing production during the third quarter and revived during the fourth quarter. On an annual level, the production is expected to have amounted to more than 13 million m³, which would be some 3% more than during the previous year. The MDF exports lived a slightly different evolution: for four successive quarters, the exports were growing. An increasing amount of European MDF had Eastern Europe, North America and Africa as destination. The home sales on the other hand seem to have been shrinking. The improving exports could thus compensate the annual consumption level.

The European OSB industry continued to grow in the second half of 2005, although less vivid than during the previous years. The production augmented with around 3% and is estimated to have crossed the 3 million m³ threshold. Home sales as well as exports improved during both the third and the fourth quarter, what contributed to a positive year-end picture. Western Europe and North America continue to be the most important outlet markets for European OSB.

The main concern for the European wood-based panels manufacturers is the fact that all important cost parameters (wood, energy, resins, transportation, …) are increasing significantly throughout Europe . EPF will therefore continue to advocate that the authorities must promote the most eco-efficient use of wood. Furthermore, EPF was urged to undertake new actions to communicate the excellent environmental credentials of wood-based products and on the positive role of wood in tackling climate change. The EPF members welcomed the successful exhibition “Tackle climate change: use wood” in the European Parliament and the accompanying publications as a very good start of such a positive action plan.

Brussels , 22 February 2006

More information : EPF General Secretariat, Mr Kris Wijnendaele

Allée Hof-ter-Vleest 5, box 5 , B-1070 Brussels

Tel. +32 2 556 25 89 Fax + 32 2 556 25 94

E-mail : info@europanels.org ; Internet : www.europanels.org