Four years ago, two of Ireland’s longest-established timber processing companies – the Grainger Group and the Palfab Group – merged to give rise to GP Wood. Investments of nigh on €20m in its two plants at Enniskeane and Lissarda, have seen the new company quickly establish itself as one of Ireland’s largest and most advanced / diverse timber operations. We paid a visit to County Cork and caught up with director Niall Grainger to find out more.
Fully committed to providing quality products and service excellence to its many and varied clients, GP Wood is one of Ireland’s largest suppliers of sawn softwood products. The company was formed in April, 2013 as a result of a merger of the Grainger Group (originally founded by William Grainger, based in Enniskeane, West Cork) and the Palfab Group (founded by the O’Callaghan family and based in nearby Lissarda).
The coming together of these two successful family businesses saw the new company hit the ground running as one of the country’s premier timber processing operations. But, not content to rest on their laurels, the Grainger and O’Callaghan families have committed themselves to a substantial capital investment programme at both sites, aimed at taking GP Wood to the next level.
Operating two of Ireland’s largest and most technologically advanced sawmills, GP Wood’s original companies were both established in 1977. The group now generates direct employment for 160 staff plus roughly the same again indirectly through their forestry operations. Timber manufacturing focused on the construction, fencing, garden leisure and packaging markets is the core business of the group.
GP Wood have state-of-the art facilities for kiln drying, machining and timber treatment. In 2005, they constructed Ireland’s first largescale commercial biomass CHP plant which was designed around the Enniskeane sawmill’s energy requirements. Using by-products from the sawmilling process, the plant produces 2.5 MW of electricity which is sold to the national grid, and 6 MW of thermal energy.
The directors of GP Wood are Niall Grainger, Donal O’Callaghan, Susan Grainger and Gerard O’Callaghan, all of whom have wide-ranging experience in the timber processing sector.
To coincide with the 40th anniversary of the original companies, GP Wood – having invested more than €4 million in upgrading its facilities in Lissarda – completed a €14 million investment programme at its plant at Enniskeane, an investment that funds an enhanced product range; increases plant capacity, efficiency and technology; provides a much-needed outlet for increased log volumes expected from private forests in the Munster region; and generates employment for an additional 27 people, directly and indirectly.
“The last couple of years have been very interesting,” notes Niall Grainger. “In a nutshell, the new business has outperformed itself and exceeded our expectations. When you marry two companies, there will always be risks associated with baggage carried into the new enterprise but the Grainger side and the Palfab side pre-planned meticulously during the course of 2012 and the early part of 2013 and those preparations paid dividends. The reason for the merger was to put down the foundations for growth and to capitalise on the potential in both companies – we have certainly achieved this so far.
“If you look at the geographic region, we were located just twelve miles apart and historically we would have been competing for the same raw materials, even though each company had a different focus and direction. This wasn’t the first time it was mooted that the Graingers and O’Callaghans should join together but this time we decided to follow through with the merger. Both companies had managed to come out of the recession in a stronger position so we thought about what the next development would be and it made clear commercial sense to merge. As we reach our four-year anniversary, everything has gone to plan so far.”
During the four years since the genesis of GP Wood, the directors have demonstrated an impressive willingness to invest in the new enterprise. “We have spent over €4m on upgrades at the Lissarda site and have just completed a €14m investment in Enniskeane, all of which constitutes Phase One of the three-phase investment programme for both sites,” Niall reveals.
“We will continue to invest in both sites to maximise efficiencies and to add value to become one of the most efficient medium-volume (by European standards, but high-volume by Irish standards) processors on the island. We’re not just cutting logs – we want to add as much value to the crop as we possibly can.”
GP Wood have a professional experienced forestry team, purchasing and harvesting standing timber lots – both thinnings and clearfells – from Coillte and private growers. They pay top prices for well-managed lots and use the most modern harvesting equipment and techniques, always operating to the highest standards of Health & Safety, environmental awareness and sustainable forest management practice.
In addition to a full range of pallet and packaging materials and fencing, post and rail timbers, GP Wood offer a wide range of kiln-dried, planed and graded construction timber from CLS to floor joists, manufactured in an array of widths and thicknesses and in lengths up to 8.4 metres. They also supply machine studding and tiling battens in lengths from 2.4 metres to 5.4 metres in a range of widths and thicknesses.
As well as sawn timber, substantial quantities of woodchips, bark and sawdust are produced and sold into a number of markets. Marketing of these co-products is an integral part of the sawmilling business. Woodchips are sold in Ireland for the manufacture of Medium Density Fibreboard (MDF) and exported to markets as far away as Holland, Belgium, Germany, Finland and Norway for the production of paper.
Kiln-dried baled wood shavings for use in the equine and farming sectors are also available throughout the year.
Sawdust and bark are consumed on site in the company’s Combined Heat and Power plant (CHP), where they are burnt to provide hot water to operate the kilns and power turbines to generate electricity.
Touching on the main products and services provided by GP Wood, Niall Grainger continues: “Construction, pallet, packaging and fencing products are our core products but we also have engineered wood, biomass and energy agendas too. A largescale biomass plant will be installed once we have secured planning permission.”
Even though GP Wood appears to have already achieved its objective of becoming Ireland’s most advanced sawmills, Niall confirms that the quest for perfection is relentless. “It would be naïve to say you have achieved your objectives but we are certainly on our way to becoming one of Ireland’s most advanced and efficient sawmills. The owners are perfectionists and it’s an ongoing process of striving for perfection. We are a service provider, servicing the construction; pallet and packaging; fencing and garden products sectors as well as our energy and engineered timber interests.”
Providing employment for in excess of 300 people, GP Wood’s contribution to the local – and national – economy is massive. “The real strength of the group is the workforce at both sites,” says Niall. “Both companies had very low turnover of labour prior to merging and GP Wood would not be here without our skilled workforce. Sawmilling is a modern, state-of-the-art industry and there are so many skills and different facets involved across the board, from the office staff and sales team through to our saw doctors, marine engineers, electrical engineers, etc. The workforce is highly diverse and skilled – we only employ the best and we only employ people who care.”
Where are the raw materials sourced from? “About 98% of it comes from the Munster region. We sometimes go a bit further afield but transport can become an issue. We import a small amount from Scotland. Of the aforementioned 98%, historically, the vast majority of it would have come from the state forestry body, but over the next ten-fifteen years, there will be a lot of private forestry coming on stream, so we’re expecting it to go to around 50% Coillte and 50% private forestry. We want to be best positioned to process that properly and to give our customers the best product whilst at the same time paying our suppliers the best price. The merger and subsequent investments will enable us to do this.”
Is there a need for increased forestry in Ireland? Is it a commercially-viable option for more farmers to dedicate their land to timber growth? “This is happening right now and there is a need for more,” Niall replies. “Unfortunately, the wood processing and forestry industries are not good at promoting themselves. But this rurally-based sector is a very important contributor to the Irish economy.
“There are more than 12,000 people employed in wood processing in Ireland. Output was close to €2.3bl in 2012 and there are more truck movements for timber than beef in Ireland. Not only are we not promoting ourselves properly but it is an industry that could be exploited more and companies like GP Wood are putting their money where their mouths are to add value to our customers and our suppliers. We are hugely committed to this and there are massive benefits to the local economy.”
As for the challenges facing GP Wood and the timber processing industry in general moving forward, Niall states: “A lot of the private forestry that’s coming on stream is made up of small plantations and wood mobilisation, i.e. getting that wood to processing, is a challenge.
“Brexit is a major one, as 50% of what we produce goes to the UK. I wouldn’t be concerned about our ability to sell because the UK is a great buyer, the product is here and we are very competitive, but a border would add to costs due to the logistics of moving he product.
It’s not doom and gloom over Brexit and possible tariffs, but more a concern that logistics could potentially present difficulties, which again amounts to wood mobilisation.”
Whatever the future holds, GP Wood is in an excellent position to go forward progressively and successfully. “Our primary goal moving forward is to become the most efficient wood processor in Ireland, if not in Europe, while at the same time adding value for our customers and suppliers,” Niall concludes. “Of course, as a commercial entity, we also aim to increase our percentage of net profit, but this is a kind of self-fulfilling prophecy. While we don’t have any control over market prices or what we pay for our raw materials, we are striving to have complete control over what happens in the middle.”
Tel: 023 8822500
Fax: 023 8847698
Email: [email protected]
Taken from Irish Tractor & Agri magazine Vol 5 No 4, June 2017