Norbord's OSB Survival Strategy in North America

Implications: Norbord's European and UK operations comprise a relatively small part of their revenues.  OSB and wood plant operations in North America provide the majority.  It will be their ability to survive the depressed North American housing market in 2008 that will determine their success and continued viability.

Analysis:  Luckily for Norbord, their OSB operation in Inverness, Scotland, has been successful and profitable.  Their relatively recent venture into Belgium was based on future profitable opportunities that the European community will offer.  Regarding North America - Since they feel they are the low cost OSB producer in the US, Norbord's strategy has been to reduce and control production costs, take minimal production downtime while maintaining their position with their building product distributors and the "big boxes", and wait for the opportunity to gain share as most of their competitors idle or close facilities "due to market conditions".  Norbord has several older plants that are vulnerable to the continuing depressed housing market and low OSB prices.  But as they take selective downtime at the older facilities (including two in Quebec) and stay visible to their clients, their strategy may come to fruition.