The global engineered wood market size was valued at USD 321771.16 million in 2021 and is anticipated to witness a compound annual growth rate (CAGR) of 6.78% from 2022 to 2030. The global engineered wood market growth is driven by rising demand for environmentally-friendly building materials, such as engineered wood, and rising construction activities across developed nations. Moreover, increasing government investments in housing is again expected to spur market growth. Furthermore, governments have adopted stringent regulations to minimize carbon emissions, which is further expected to spur the market growth. Improvements in technology and machining systems are projected to offer significant market opportunities over the forecast period.
Global Engineered Wood Market: Regional Insights
Regionally, Asia Pacific is projected to dominate the global engineered wood market over the forecast period owing to the increasing construction activities across countries such as China and India. According to the World Resources Institute, The country has the largest construction market in the world, encompassing 20% of all construction investments globally. China is expected to spend nearly USD 13 trillion on buildings by 2030. According to the National Bureau of Statistics of China, the construction output value in the country increased from CNY 9.6 trillion in 2010 to CNY 24.84 trillion in 2019.
At the same time, North America is projected to witness fastest growth in the global market over the forecast period due to strong economic growth and increasing spending in non-residential sector. According to the survey ‘Non-residential building spending to grow through 2021’ by the American Institute of Architects, the overall non-residential sector is expected to increase by 1.5% in 2021. The Canadian construction industry is the second-largest in North America. According to the World Economic Forum, the country is one of the global leaders in immigration policies and has been planning to increase its targeted number of refugees and displaced people, in the coming years, ranging from 43,000, as a low target in 2019, to 64,500 by 2021.
Figure 1. Global Engineered Wood Market Share (%) in terms of Value, By Region, 2021
Global Engineered Wood Market Drivers:
Growing demand from non-residential sector is driving growth of the global engineered wood market. According to India Brand Equity Foundation, in India, the government has proposed USD 429.55 million through its Union Budget 2020-21 for the Revitalizing Infrastructure and Systems in Education (RISE) by 2022. According to the BNC Network, about 709 healthcare construction projects worth USD 65 billion are expected to be built in the MEA region. Furthermore, like Jordan, the developing countries are receiving funds from the United States to build 25 additional new schools in the country as a part of the “Let Girl Learn” initiative.
Growing use of Cross Laminates Timber (CLT) as a construction material is again fostering growth of the market. Cross Laminates Timber (CLT) offer designed flexibility and high thermal performance and energy efficiency features. Moreover, its cost effectiveness, fire protection, acoustic performance, and environmental advantages are further projected to propel market growth.
Global Engineered Wood Market Opportunities:
There is a surge in construction and residential needs in developing countries, such as India, where the Pradhan Mantri Awas Yojana targets to build 30,000 affordable homes by the end of the year. And, the Chinese city of Shenzhen is planning to build a million affordable residences by 2035. This is expected to serve major market growth opportunities over the forecast period.
As the demand for engineered wood grows, many manufacturers are focusing on raising its profile. Engineered wood is less expensive than solid natural wood, but it offers better quality and durability. In addition, it is less expensive and easier to care for, which makes it a lucrative option for kitchen cabinets. Expanding application of engineered wood in modern kitchen application is expected to bring bright market opportunities.
|Base Year:||2021||Market Size in 2021:||US$ 321771.16 Mn|
|Historical Data for:||2017 to 2020||Forecast Period:||2022 to 2030|
|Forecast Period 2022 to 2030 CAGR:||6.78%||2030 Value Projection:||US$ 578741.4 Mn|
Binderholz GmbH, Boise Cascade, Georgia-Pacific (Georgia-Pacific Wood Products LLC), HASSLACHER Holding GmbH, Havwoods India Pvt Ltd, Huber Engineered Woods LLC, KLH Massivholz Wiesenau GmbH, Kronoplus Limited, Louisiana-Pacific Corporation, Mayr-Melnhof Holz Holding AG, Norbord Inc, NORDIC STRUCTURES, Pacific, Woodtech Corporation, Resolute Forest Products, Roseburg, Stora Enso, West Fraser, and Weyerhaeuser Company
|Restraints & Challenges:||
Global Engineered Wood Market Trends:
Increasing demand for sustainable building materials is a growing trend in the market and this is expected to uplift the market growth in the near future. It is an eco-friendly and cost-effective alternative to conventional building materials and contributes to the reduction of greenhouse gas emissions.
Growing advances in manufacturing techniques has emerged as another major trend in the market. This will drive the demand for engineered wood. In addition, wooden flooring will continue to be a key application for engineered wood which will support the market growth in the near future.
Global Engineered Wood Market Restraints:
Strict environmental regulations associated with the formaldehyde emissions is projected to hamper the market growth. The high levels of formaldehyde may lead to various health conditions, thus regulations exist to limit exposure. For instance, US HUD Manufactured Housing Standard: This standard specifies a 0.20 ppm emission limit for plywood and a 0.30 ppm limit for particleboard when tested using the ASTM E1333 Large Chamber Method.
Unfavorable conditions arising due to the impact of Covid-19 on the global economy is projected to restrict the market growth. According to the latest predictions on April of 2021 by International Monetary Fund, the global economic growth contracted by 3.3% in 2020, before growing 6% in 2021.
Figure 2. Global Optical Coating Market Share (%), By Application, 2021
Global Engineered Wood Market Segmentation:
The global engineered wood market report is segmented into Type, Application, and Geography
Based on Type, the market is segmented into Plywood, Oriented Strand Board (OSB), Glulam, Cross Laminated Timber (CLT), Laminated Veneer Lumber (LVL), Particleboard, and Other Types. Out of which, Plywood is expected to dominate the global market over the forecast period and this is attributed to the growing demand from variety of applications in construction industry, such as doors, external cladding, walls, flooring, framing, joinery, interior paneling, interior rails and balustrades, portal frames, and interior and exterior stairs. They can withstand shear stress, and offer a variety of advantages such as lightweight construction, architectural design freedom, resilience, high impact load resistance, and fast conventional construction.
Oriented Strand Board (OSB) segment is also expected to witness significant growth in the near future. They offer similar properties compared to plywood but have a structural advantage because of the aligned strands. Additionally, they are cost-saving option when used for wall, sub-flooring, and roof sheathing applications without compromising strength.
Based on Application, the market is segmented into Non-residential and Residential. Out of which, Non-residential is expected to dominate the global market over the forecast period and this is attributed to the growing demand for construction of low-rise commercial building. According to the Wood Products Council, at the end of 2019, the United States had nearly 600 built or planned wooden commercial buildings. In addition to that, height restrictions on timber buildings were recently loosened in British Columbia and Oregon.
Residential segment is also expected to witness significant growth in the near future and this is owing to the growing demand from walls, furniture, flooring, roofs, doors, cabinets, beams, columns, and staircases.
Global Engineered Wood Market: Key Developments
In August 2020, Binderholz GmbH bought all the assets of Klausner Lumber One LLC, Florida in an auction for USD 61.0 million. This acquisition of Klausner Lumber One LLC enables the company to expand its timber processing capabilities in the United States.
In January 2021, Boise Cascade inaugurated its second-door shop in Texas, United States, which can serve approximately 900 customers. This new shop is in line with the company strategy to expand with the help of supplier partners.
Global Engineered Wood Market: Key Companies Insights
The global engineered wood market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis. Some of the key players in the global engineered wood market are Binderholz GmbH, Boise Cascade, Georgia-Pacific (Georgia-Pacific Wood Products LLC), HASSLACHER Holding GmbH, Havwoods India Pvt Ltd, Huber Engineered Woods LLC, KLH Massivholz Wiesenau GmbH, Kronoplus Limited, Louisiana-Pacific Corporation, Mayr-Melnhof Holz Holding AG, Norbord Inc, NORDIC STRUCTURES, Pacific, Woodtech Corporation, Resolute Forest Products, Roseburg, Stora Enso, West Fraser, and Weyerhaeuser Company
*Definition: Engineered wood is an alternative to solid wood that is stronger and more durable. It is a composite material composed of several layers of wood, usually plywood. The layers are bonded together with adhesives and are tested to ensure the durability of the final product. Engineered wood is also more stable than solid wood because the grain runs in different directions.
Engineered wood products are composed of raw wood combined with adhesives and resins. The raw wood can come from trees or from recovered wood chips and sawdust. The resins are typically synthetic. The mixture is then pressed together using heat and pressure. The final product has many of the benefits of solid wood while being more cost-effective. Engineered wood floors are often more durable than solid wood and are better suited for high-moisture environments. As a result, they can be installed on most levels of a home and over existing concrete.
The growth of the engineered wood market is primarily attributed to the fact that new developments are designed to meet green building standards. This helps to reduce the overall project costs. In addition, increasing urbanization increases the need to optimize land use in urban areas. Moreover, increasing investments and funding in the market is again propelling market growth. Furthermore, increasing remodeling of old houses and growing new house construction are further driving growth of the engineered wood market.
On the other hand, strict environmental regulations pertaining to formaldehyde emissions is projected to hamper market growth.
Key features of the study: