The global engineered wood market size was valued at USD 276,838 million in 2021, envisioned to reach USD 458,855 million growing at a CAGR of 6.52% during the forecast period. The growing usage of engineered wood and advancements in reconstruction, renovation, and remodeling of old buildings drive market growth.
Engineered wood or composite wood comprises various wood products created by adhering veneers, particles, fibers, and wood strands to make a synthetic composite material. Engineered wood is a derivative wood product produced by bonding or attaching strands, particles, etc., with adhesives or other means of fixation to make composite materials. They consist of a range of items, from plywood to roof trusses. Due to specific advantages, engineered wood furniture may be preferred over solid wood furniture. This type of furniture is constructed to satisfy application-specific specifications. Another advantage is its flexibility and availability in a wide range of thicknesses. Compared to solid wood, it can be cut, drilled, routed, jointed, glued, and secured relatively quickly. The most notable benefit of engineered wood furniture is that it is far more affordable than solid wood furniture.
The engineered wood market is primarily driven by the increase in the rehabilitation and remodeling of older homes. In addition, new house construction drives the market. In addition, as engineered wood is a cost-effective and environmentally-friendly alternative to other wood and cement products, its use as a substitute for building materials should rise. In addition, engineered wood produces fewer hazardous byproducts than emission-intensive materials like concrete, steel, and aluminum. Therefore, it is anticipated that engineered wood will reduce greenhouse gas emissions. Moreover, the adhesives and resins used in engineered wood are environmentally stable and do not emit greenhouse gases. This has increased the utilization of engineered wood among engineers and architects.
|Market Size||USD 458,855 million in 2030|
|Fastest Growing Market||North America|
|Largest Market||Asia Pacific|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends|
Due to the world's rising population, there is a growing demand for housing. This has caused an upsurge in the construction of new homes, especially in developing nations where urbanization is expanding faster. Consequently, this will increase the need for construction materials like concrete, steel, and aluminum, the production of which generates greenhouse gases. However, compared to these other building materials, engineered wood is environmentally stable and emits no greenhouse emissions; consequently, it is ecologically beneficial. A portion of engineered wood is manufactured from wood scraps. In addition, this material is renewable, biodegradable, non-toxic, energy-efficient, and recyclable. Increased acceptance of green buildings in nations such as the United States, Germany, and France has increased demand for eco-friendly building materials, such as engineered wood.
Approximately 60% of new development projects are designed following green building standards. In addition, engineered wood is less expensive than conventional wood and cement products. Thus, it also reduces the project costs of the buildings, which motivates builders and architects to choose engineered wood over traditional building materials. These factors are currently driving the global engineered wood market growth. Increasing urbanization heightens the demand for optimal land utilization in metropolitan areas. To construct new and modern facilities, obsolete infrastructures are being dismantled. Moreover, several historic buildings and structures have ended their useful lives and are no longer safe for habitation. The owner or government demolishes the existing building to construct a new building.
Additionally, there is a growing desire to rebuild or remodel older homes using cutting-edge technology to improve their aesthetic appeal. These residential and commercial renovations require engineered wood for floors, walls, and roofing. Most of these reconstructions, renovations, and remodeling projects occur in wealthy nations. These reasons contribute to the global expansion of the market for manufactured wood.
The primary restraint on the global market is the danger posed by similar-functioning replacements, like plastic laminates and foils. These alternatives are likely to exacerbate the threat to engineered wood. Due to the immutability of ceramic flooring, the non-wood flooring industry is also gaining appeal. Thus, vinyl flooring and other alternatives are in demand. Due to severe limits on tree cutting, fewer raw materials are available for producing composite wood, which increases the cost of engineered wood products. This eventually leads to the selection of cheaper alternative materials, the primary factor restraining engineered wood market growth.
The penetration of furniture and other wood-based engineered items in Asia-Pacific and emerging African nations is low. In addition, the majority of plywood used in these regions is typically low-cost Tier 2 and Tier 3 plywood from the unorganized market. This presents a significant opportunity for materials such as Medium-Density Fibreboard (MDF), a suitable prospective substitute for low-cost and low-quality plywood. MDF is inexpensive, resistant to dampness, quickly formed, and more aesthetically pleasing than cheap plywood. In addition, the MDF market in India is anticipated to double between 2018 and 2025. In addition, changing the furniture business in these emerging countries from an unorganized to an organized market aids MDF's market penetration. Therefore, there are numerous opportunities for MDF in emerging nations.
The region-wise segmentation of the global engineered wood market includes North America, Europe, Asia Pacific, and LAMEA.
The Asia Pacific will command the market with the largest share while advancing at a CAGR of 6.5%. Asia-Pacific is home to the world's most significant population; thus, wood goods are in high demand. Rapid urbanization and worldwide market expansion are occurring in developing nations. The aggressive expansion targets, enterprises establishing a globally competitive position, rich human resources, and rapid urbanization are the primary reasons for the engineered wood markets in the Asia-Pacific region to expand. Additionally, the Indian government's Pradhan Mantri Awas Yojana aimed to construct 30,000 affordable homes by 2021. This increased demand for manufactured wood on the Indian market. Similarly, the Shenzhen Municipal Government in China aims to build one million affordable residences by 2035. Government initiatives are anticipated to increase the demand for engineered wood throughout the forecast period.
North America will advance at a CAGR of 6% and hold USD 69,221 million. In the United States and Canada, wood has been a vital aspect of the construction industry. The increased demand for engineered wood results from advancements in manufacturing techniques and the production of more efficient wood products. In North America, wooden flooring is one of the primary applications for engineered wood. Moreover, the expansion of the market in the U.S. and Canada is primarily driven by the increased construction of green buildings. By 2025, it is anticipated that over 60% of new building development in the United States and Canada will be green buildings. In addition, the construction industry in Mexico is adopting the green building trend swiftly. Due to this, the engineered wood market products is likely to witness massive growth in the North American region.
The global engineered wood market is classified based on type, application, end-user, and region.
Based on type, the fragments are I-Beams, plywood, laminated veneer lumber (LVL), glulam (glued laminated timber), oriented strand boards (OSB), cross-laminated timber (CLT), and others.
The others segment is projected to advance at a CAGR of 6.5% and hold the largest market share. This section includes engineered wood such as rim board, specialty panels, and other structural composite lumber, as well as unstructured engineered wood like particle board and fiberboard. This manufactured wood is utilized for construction, commercial, and industrial purposes. Another section of engineered wood is used in flooring and wall systems. In addition, it is utilized as beams, headers, trusses, skateboards, columns, posts, and specialized panels. Solid and enduring structural integrity gives rim board, specialized panels, and other engineered wood an advantage for usage in building, flooring, and furniture, among other applications.
The plywood segment will hold the second-largest share. Plywood is manufactured by pressing and gluing wood veneer sheets into a single solid block. It is constructed from softwood, hardwood, or both and can be used for various applications, like subflooring, single-layer flooring, wall and roof sheathing, and ceiling/deck sheathing. Plywood has a variety of uses in furniture, cabinets, and things that require more durability and strength. The expansion of the worldwide plywood market is anticipated to be fueled by increased expenditures by major market participants on technology and operations and an increase in spending by middle-income consumers on branded plywood due to rising discretionary income in recent years.
The fragments include construction, furniture, flooring, packaging, and others based on application.
The furniture segment is projected to advance at a CAGR of 6.6% and hold the largest market share. This sector encompasses engineered wood, which produces furniture such as tables, chairs, sofa sets, cabinets, and closets. There is an increase in the popularity of premium hardwood furniture in home and workplace interior design, presenting new growth opportunities for the industry. In addition, there is an increase in people purchasing wooden furniture through e-commerce outlets. Customers are attracted to e-commerce platforms because they provide alternatives for personalization, more significant discounts, and faster product shipping.
The construction segment will hold the second-largest share. Engineered wood is utilized in the construction sector for headers, rim boards, panels, and beams. Engineered wood is used in construction as an alternative to steel and concrete. The most recent technology employed in the production of engineered wood has made it more robust, stiffer, durable, lighter, and affordable. When appropriately designed, it also improves the building's appearance.
Based on end-user, the fragments are residential and commercial & industrial.
The residential segment is projected to advance at a CAGR of 6.3% and hold the largest market share. Immigration from rural to urban regions has fueled the growth of the new home market, which in turn stimulates the expansion of engineered wood sales in this market segment. Recent development has had the most significant impact on wood flooring sales in the past few years. Other reasons, such as household remodeling and repair work, have contributed to the expansion of the market share. With rising demand for I-beams, LVL, and plywood, it is anticipated that the global housing market and refurbishment will expand soon, benefiting construction segments.
The commercial & industrial segment will hold the second-largest share. In North America and Europe, developing low-rise non-residential buildings and multistory structures is a significant engineered wood market for products and structural and nonstructural wood panels. Building codes often prohibit wood framing in structures with more than six stories. For commercial construction, engineered wood materials offer durability, stability, adaptability, and cost-effectiveness. Utilized in the non-residential sector, engineered wood is cost-effective, code-compliant, sustainable, and minimizes carbon footprint.