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‘India is a growing market and significant resource pool for Siempelkamp’

On the sidelines of LIGNA 2019, Modern Woodwork caught hold of Mr. Christoph Michel, who recently took over the reins of Siempelkamp Group as CEO.
He spoke about his vision for leading a 700-million Euro company having a legacy of 135+ years, his views on Asian market and future of wood-based panel industry. Excerpts.

 

Modern Woodwork: Congratulations on putting up the most futuristic stand at LIGNA 2019. How special was it for Siempelkamp Group? And how was the overall response? Where do you see ‘Intelligent Manufacturing’ going forward?
Mr. Christoph Michel: We received really positive feedback in regards to our new booth concept from customers, suppliers, other business partners and even competitors of our group. Intelligence in integrated wood processing is where Siempelkamp clearly the market leader. The actual task of the wood-based materials industry is to systematically obtain information from the data volume, to determine characteristic values and to make these available to decision-makers on mobile devices. It is also a matter of networking the plant, simulating the production process and controlling it autonomously in the best way possible.
Plant suppliers who are able to master the entire system while also supplying digitalisation from a single source are able to create a competitive lead for themselves. For decades, Siempelkamp has been focussing systematically on the digitalisation and modelling of its plants and has thus created the basis for today’s utilisation of the enormous potential contained in such data.

MW: Siempelkamp’s motive is not to sell just machines; but to sell sophisticated solutions and concepts. However, the developing countries usually prefer buying the former and skip the solutions or concepts based on the cost factor. Your opinion on this.
CM: We have solutions for both demands. We supply complete process lines with all the processing equipment from within the Siempelkamp Group and thus provide optimum solutions for our customers with advantages on saving resources like wood, glue, energy. Alternatively, we can also supply individual stand-alone machines or integrate 3rd party equipment, e.g. in addition to our forming- and press-lines into a complete process line. Thus, while each customer has to look at his product portfolio and individual requirements and we are able to supply the most efficient solution.

MW: Siempelkamp’s India connection dates back to 1950s. In one of his interviews, Dr. Dieter Siempelkamp had mentioned that the company got its first Indian project of chipboard presses for the production of tea cases in 1950. Eventually, you had an Indian subsidiary. How do you look at India as a market?
CM: The Indian market has been important for Siempelkamp Group for many years. We look at this particular market as one to sell our equipment and services as well as a market for highly qualified engineering resources. In fact, we have set-up an engineering team which is helping us worldwide to automate our plants with proven quality and in a very efficient way.

While many Chinese customers are already using our locally manufactured equipment, we are in the process of installing our first machines – partly made in China – also in India.

MW: As compared to your global market share, where does India stand and how do you plan to grow it further?
CM: In the past years, the wood sector in India shows an increasing demand. The focus changed from simple board products to the manufacturing of high-quality boards. Accordingly, customer expectations regarding equipment and services have been increasing, too.
We have seen this development in the past in one of our other business areas, the metal forming sector, too. In this industry, India is now a major player in the high-quality steel industry and we have supplied our equipment and services to many of the major factories.
Consequently, we have developed our Service Center for India for both Metal and Wood industries, in order to secure a constant and immediate service.

In the past years, the wood sector in India shows an increasing demand. The focus changed from simple board products to the manufacturing of high-quality boards. Accordingly, customer expectations regarding equipment and services have been increasing, too.

– Mr. Christoph Michel, CEO, Siempelkamp Group

 

MW: Your views on the Middle-East as market and how well are you placed therein?
CM: We see the Middle East markets also growing. However, due to the scarcity of wood as raw material source in some of the Middle East countries, these markets are rather a basis for export for our Indian or South-East Asian customers. We serve our customers in the region and are market leader for example in Turkey. Our customer base in the Middle East is highly professional with high quality products. Therefore, our Indian customers who want to export in such countries are forced to keep up with the equivalent technology which is based on our high-performance equipment.

 

Mr. Christoph Michel On Asian Market:

  • We look at India as one to sell our equipment and services as well as a market for highly qualified engineering resources.
  • In the past years, the focus of wood sector in India is changed from simple board products to the manufacturing of high-quality boards.
  • There is a growth in the Middle Eastern markets. However, due to the scarcity of wood as raw material, these markets are rather a basis for export.
  • The wood-based panel industry is highly advanced in China and demand for the same is higher than in India.

 

MW: How do you compare Indian and Chinese markets based on scale, demand, and conversions? Are there any other parameters that are relevant for making such a comparison?
CM: While the wood-based panel board industry in China has already developed to a very large scale, India is yet in the process to do so. Demand for wood-based panel boards in China is currently higher than in India, which lead to many wood processing lines in the past and a large installed base for Siempelkamp equipment and process lines. Therefore, we set-up two production facilities in China serving the local and also the world market with Siempelkamp equipment. While many Chinese customers are already using our locally manufactured equipment, we are in the process of installing our first machines – partly made in China – also in India. We think that the mixture between cost efficiency of these lines, productivity and quality is highly attractive to the Indian market and we hope that in combination with our local Service team this becomes an unbeatable package for our Indian customers.

MW: ContiRoll® Generation 9 and ContiRoll® Generation 9 NEO were the talking points during LIGNA. This series is seen as a future of continuous wood-based materials production. Please explain more about this for our readers.
CM: Based on decades of experience within the Siempelkamp Group, this new ContiRoll® Generation 9 is the latest state engineering in continuous presses. The main features are: a new extended and highly flexible infeed, a new Siempelkamp Press Controller, as well as a new Hydraulic System. Overall, these new features are leading to a much higher flexibility and productivity for our customers.

MW: You exhibited Pallmann for the first time in the Siempelkamp’s stand during LIGNA 2019. How do you look at Pallmann adding value to Siempelkamp’s woodworking line of business? How will Pallmann be placed in other markets?
CM: Pallmann’s size reduction technology is the benchmark for machines and complete systems for the preparation and size reduction of almost any kind of material. However, one of our core competencies for size reduction technology is of course the wood processing industry. Pallmann equipment is offered either as integral part of our processing lines or also offered as stand-alone machines. Thus, having this technology leader in our Siempelkamp Group enables us to provide highly integrated process lines. Pallmann will also continue the engineering, manufacturing and selling of size reduction equipment for other markets, e.g. in recycling of reusable materials, gentle preparation of foodstuff, or the size reduction of plastics.

MW: A lot is being talked about eco-friendly raw materials these days. Siempelkamp’s R&D has successfully confirmed that rice straw, bamboo, flax, reed, sugar cane bagasse etc. can be used for particleboard production. Have you been able to implement this in a production environment?
CM: Siempelkamp has always been in the first row when it comes to responsibility and sustainability. We take the use of so-called annual plants and agricultural residues as an important part of our responsibility. Therefore, we have developed several ways to make use of these materials in the last 20 years. We have delivered plants for the use of sugar cane bagasse, we have delivered plants for the use of hemp and flax shives. And last but not least, we are very proud of being the first on to deliver an entire plant for the production of high grade MDF made out of Rice Straw. Besides this, we have complete systems ready to produce Particle Board, MDF or OSB of Bamboo.

The actual task of the wood-based materials industry is to systematically obtain information from the data volume, to determine characteristic values and to make these available to decision-makers on mobile devices.

MW: As we are on this topic, we would like to draw your attention to a peculiar problem in India. Farmers, particularly from North India – from the states close to Delhi, burn the stubble after harvesting. This has been cited as a major cause of air pollution in Delhi and nearby areas. Have you done any research whereby the wheat stubble can be used to produce particleboard? Is Siempelkamp open to work on this concept with any of the Indian manufacturer?
CM: While we have not yet researched the use of wheat stubble as raw material, Siempelkamp is generally open to work with Indian manufacturers on concepts to use wheat stubble or other annual plants. As said before regarding the use of rice straw, we are able to also develop concepts to use wheat straw for the production of panel boards.

While we have set-up an entire plant for the production of high grade MDF made out of Rice Straw, we have not yet researched the use of wheat stubble as raw material. Siempelkamp is open to work with Indian manufacturers on any such eco-friendly concepts.

– Mr. Christoph Michel, CEO, Siempelkamp Group

MW: Since you have taken over the reins of this family-owned business in January 2019 from your predecessor Dr. Hans W. Fechner, what kind of systemic changes have you been trying to implement and what, according to you, will be the right approach to lead such a multi-dimensional company?
CM: Being part of a family owned business with more than 135 years of engineering experience enables us to look at the development of the group with a long-term view. And, given the vast experience, we have a tremendous know-how base with the employees of our companies that I can rely on when developing the group into the future. Thus, there won’t be any systemic changes but rather smaller adaptions here and there to further improve our ability to support and add value to our customers.

MW: Leading a 700 million Euro company having a legacy of 135+ years and 3,000+ vibrant workforce working from 72 different locations is a not anyone’s cup of tea. How do you see this great organization growing leaps and bounds? Any specific plans that you would like to share with our readers?
CM: The long-term main growth drivers remain positive. Thus, there will be a growing demand for the products of our customers and we expect a corresponding long-term growing demand for our equipment and services. I believe one main success factor to participate in that growth is customer satisfaction and this is what we will continue to focus on. Another one is the technological competence and this is where we are at the forefront. Limited availability of wood resources will lead to a stronger shift towards annual plants as raw material. As outlined above, we have a vast and unmatched experience in that field. In addition, we will further expand our digital services (Prod IQ family) and the overall service network as we see an increasing demand from our customers globally for further process automization of their production processes in order to increase their productivity.
Thank you very much Mr. Michel for sparing your valuable time to speak to Modern Woodwork. We wish you all the success in coming years and hope to get your kind support in future.

Questions by:
Amit Tekale

Special thanks to
Ms. Carola Lenkewitz,
Leiterin Marketing und Kommunikation,
Siempelkamp Dienstleistungs GmbH