The market for engineered wood is expected to grow at a CAGR of more than 6% globally during the forecast period. Growing demand form the non-residential sector along with increasing use of cross laminated timber (CLT) as construction material are driving the market. On the flip side, stringent environmental concerns related to formaldehyde emissions coupled with unfavorable conditions arising due to the COVID-19 outbreak are hindering the market growth.
- The engineered wood market is expected to grow during the forecast period owing to the growing demand from the non-residential sector.
- European region to dominate the market across the globe with the largest consumption of engineered wood during the forecast period.
Key Market Trends
Growing Demand form the Non-Residential Sector
- Engineered wood is widely used in construction applications and is expected to be the fastest-growing market during the forecast period.
- Engineered wood is a man-made wood product, manufactured by binding strands, fibers, wood chips, with adhesives to make composite wood structures. The growing use of wood composites in commercial and industrial applications are driving the market.
- The usage and manufacturing of engineered wood require less energy compared to conventional building materials like concrete and steel. As engineered woods are man-made, they are designed to meet the requirements thereby reducing wastage, time, and overall costs.
- The wood products are often used as beams & columns in construction and even support heavy loads and show greater strength. The value of total construction referring to educational institutes in April 2020 is USD 14,913 million, warehouses construction is valued at USD 39,169 million, health care constructions is USD 36,764 million. The growing construction activities in the non-residential sector is driving the market.
- The outbreak of coronavirus has slowed down commercial construction activities due to lockdown and disruptions in the supply chain. However, the slowdown is anticipated to be temporary and the growing need for infrastructure and sustainable development in emerging economies is expected to show considerable growth for engineered wood during the forecast period.
Europe Region to Dominate the Market
- Europe region is expected to dominate the market for the engineered wood market during the forecast period due to an increase in demand for construction activities in the region.
- Europe is one of the major economies that is making the necessary steps to attain net-zero emissions by 2050. The government’s willingness to promote wood construction and thereby reducing the carbon dioxide emissions from using conventional steel, concrete materials.
- The usage of cross-laminated timber and glulam as a mega structuring material in the construction activities as beams or curved beams in floor beams, ridge beams, ceilings, and cantilevered beams is driving the market.
- According to the European government, it is facing a housing shortage with the need for additional housing which is estimated at 2.3 to 3 lakh new units per year. So, the government plans to deliver 4 lakh new housing units by 2021, of which 1 lakh units are to be financed with EUR 2.7 billion through a new Housing Infrastructure Fund.
- The European government is likely to finance investments of about EUR 26.8 billion in infrastructure, housing, and research & development for the year 2017-22 through National Productivity Investment Fund. The German government announced a plan to construct around 1.5 million housing units by 2021. It is estimated that Germany would have a housing shortage of about 350,000 housing units per year by 2021.
- In Italy, the residential sector is dominated by renovation works compared to new constructions. The total investments in the residential sector are around EUR 76 billion with EUR 15.3 billion invested in the construction of new homes. The non-residential sector investment for the year 2019 is around EUR 43 billion. Germany and Italy are expected to be the largest consumers of engineered wood among all other European countries during the study period.
- The aforementioned factors, coupled with government support, are contributing to the increasing demand for the engineered wood market in Europe during the forecast period.
The global engineered wood market is partially fragmented with players accounting for a marginal share of the market. Few companies include Weyerhaeuser Company, Boise Cascade, Georgia-Pacific, NORDIC STRUCTURES, and Louisiana-Pacific Corporation.
Reasons to Purchase this report:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support