The global wood-based panel market size was valued at USD 189 billion in 2022 and is projected to reach USD 333 billion by 2031, registering a CAGR of 6.5% during the forecast period (2023-2031).
Wood-based panels are synthetic wood products manufactured from wood fibers, chips, particles, or veneers bound together with adhesives. Because of their low cost, versatility, and eco-friendliness, these panels are widely utilized in various industries, including building, furniture, interior design, and packaging. Some wood-based panels are plywood, particleboard, medium-density fiberboard (MDF), oriented strand board (OSB), and hardboard.
The primary aspect driving demand for wood-based panels for ceiling, cladding, roofing, flooring, and furniture applications is low product cost and exceptional strength and durability. Rising investments in residential and commercial buildings across major areas will likely drive demand for wood-based panels. Furthermore, rising public-private partnerships for developing the building industry in emerging economies such as India, China, and Saudi Arabia are expected to boost the market share of wood-based panels.
The construction industry is a major consumer of wood-based panels, particularly for flooring, roofing, and wall paneling. The growing need for residential and commercial space worldwide pushes the need for cost-effective and versatile building materials, driving demand for wood-based panels. The construction sector in the United States has grown significantly in recent years, owing to increased investments in infrastructure projects and residential buildings. As a result, there is a greater need for wood-based panels in building applications, such as plywood for roofing and wall sheathing.
The value of construction put in place in the United States reached around USD 1.44 trillion in 2020, according to the United States Census Bureau, a significant rise over prior years. This increase in construction activity has boosted the demand for wood-based panels in the country. Furthermore, the real estate market in India has been steadily growing due to increasing urbanization and urban population. As a result, there is a growing need for low-cost, environmentally friendly building materials, such as wood-based panels such as particleboard and medium-density fiberboard (MDF), commonly used in interior applications such as cabinets and furniture.
Wood-based panels are made from natural wood, which raises environmental concerns about deforestation. Logging and processing timber for panels can destroy habitats, biodiversity, and climate change. FAO: Global deforestation continues at an alarming 10 million hectares per year. If not handled sustainably, timber-based panel manufacture might cause deforestation. Many places suffer from illegal logging, which destroys habitats, biodiversity, and local communities. Harvesting, shipping, and manufacturing wood-based panels require energy. The EPA estimates that the forest products business, including wood-based panel production, emits 7% of U.S. industrial greenhouse gases. Sustainable practices and cleaner production technology are needed to lower the industry's carbon footprint. This may slow the wood-based panel market growth.
The local government announces plans to build a commercial complex including office, retail, and recreational space in a fast-growing metropolitan region. The project intends to address the growing need for contemporary commercial premises and boost regional economic growth. To balance aesthetics, utility, and affordability, the developers use wood-based panels for interior walls, ceilings, and furniture components. The Indian government's "Housing for All" program seeks 20 million affordable dwellings by 2022. The E.U. has established renewable and sustainable construction materials goals. Statista estimates that the construction industry contributed 4% to the global GDP in 2020. The U.S. Census Bureau estimated the construction business at USD 1.43 trillion in 2020. These opportunities can be taken by manufacturers and suppliers of sustainable, high-quality, and affordable wood-based panels that fulfill the different needs of the construction industry.
The global wood-based panel market is segmented based on product, Thickness, distribution channel, Application, end-user, and region.
For better understanding, the product is further segmented into plywood, fiberboard, oriented strand board, cement-bonded particleboard, lumber panels, t-beam panels, stress-skin panels, and others.
Plywood is a popular wood-based panel comprised of thin layers of glued-together wood veneers with alternate grain directions. Its strength, durability, and versatility are appropriate for various building and furniture applications.
Based on Thickness, the market is sub-segmented into 9 mm, 10 mm, 18 mm, 20 mm, 40 mm, 50 mm, and others.
Panels with a thickness of 18 mm are commonly used in construction for heavy-duty applications such as subflooring, roof decking, and structural components. Because of their 18 mm thickness, these panels are ideal for building durable and dependable shelving units and storage solutions in homes, businesses, and retail locations.
The market is further segmented based on distribution channels into B2B, OEMs, specialty stores, e-commerce, and others.
B2B distribution channels involve the sale of wood-based panels to other businesses, such as wholesalers, retailers, and distributors from manufacturers or suppliers. This channel is frequently used for large-volume orders and bulk purchases, particularly by construction businesses and furniture makers who require a consistent supply of wood-based panels.
The Application can bifurcate the segment into outdoor doors, window trim, ceiling walls, mantels, and floors.
Wood-based panels are used in flooring applications as a low-cost alternative to traditional hardwood flooring. They provide a long-lasting surface and can be designed for increased strength and wear resistance.
End-user segment can be classified into residential, commercial, hotels, villas, hospitals, schools, malls, and others.
Wood-based panels are widely utilized in home construction for various applications, such as wall paneling, flooring, cabinetry, and furniture. They are popular due to their natural aesthetics, adaptability, and simplicity of installation.
The global wood-based panel market research is analyzed in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.
Asia-Pacific is predicted to rise at a substantial CAGR of 6.8% throughout the forecast period. Asia-Pacific controlled global market share. Due to rising construction and furniture demand, wood-based panels are in demand in China, India, and Japan. The China Timber and Wood Products Distribution Association reported that China produced 315 million cubic meters of wood-based panels last year, making it the largest manufacturer. Plywood manufacture accounted for most of the country's wood-based panel production, with 201 million cubic meters. Last year, fiberboard and particleboard produced 63 million and 33 million cubic meters, respectively.
According to the Department of Commerce (India), India exported USD 1,152.04 million of plywood and related goods in F.Y. 2021, up from USD 1,086.88 million in F.Y. 2020. With 49.2% of overall leases last year, I.T. drives office space demand. Banking, financial services, and insurance (BFSI) made up 15.2% of the office space market, up 3% from 2020. The government's Make in India initiative attracted several multinational companies to invest in the country, which is expected to increase demand for new office buildings and wood-based panels like particle boards for furniture production. India's massive building sector might become the world's third-largest by 2022. Indian government plans like Smart Cities and Housing For All by 2022 are intended to boost the lagging building industry.
Europe holds a sizeable global market share and is expected to boost at a CAGR of 6.5% during the forecast period. Europe accounted for more than a quarter of the total market share. Germany, the region's major furniture market, primarily drives regional demand. The expansion of the region's furniture industry is also expected to have a favorable impact on particleboard demand in the future years. The building industry in Germany has expanded significantly in recent years. The country's construction of multiple residential complexes, business buildings, and infrastructure projects has increased the demand for wood-based panels in construction applications. IKEA, a well-known furniture retailer with a significant European presence, heavily relies on wood-based panels in its products. IKEA manufactures a wide selection of furniture products, such as bookshelves, cabinets, and tables, using wood-based panels such as particleboard and MDF.
The North American market holds a significant market share. Residential construction activity has increased in the United States due to increased demand for houses, low mortgage rates, and strong economic conditions. Wood-based panels such as plywood and OSB are widely utilized in new home buildings for framing, sheathing, and flooring. The United States and Canada have supported sustainable building methods, such as using wood-based panels sourced from certified sustainable sources. LEED (Leadership in Energy and Environmental Design) certifications for green buildings encourage using environmentally friendly materials such as wood-based panels.
In the Middle East and Africa, regional players are expected to increase R&D operations to produce cost-effective and high-performance wood-based panels, which is expected to support market growth. Due to poor manufacturing, Middle Eastern countries have greater delivery costs than the Asia Pacific and North American countries. The United Arab Emirates (UAE) has significantly invested in infrastructure projects such as commercial buildings, hotels, and transportation infrastructure. These initiatives fuel demand for wood-based panels used in applications such as wall cladding, false ceilings, and interior furnishings. Demand for inexpensive and sustainable housing options is increasing as urbanization accelerates in nations such as Kenya and Nigeria. To address the housing needs of the fast-rising population, wood-based panels such as plywood and OSB are being employed in prefabricated buildings.
Latin America is rapidly urbanizing, increasing construction activity in the residential, commercial, and infrastructural sectors. As a result, demand for wood-based panels in building applications such as flooring, wall paneling, roofing, and furniture is increasing. Brazil and Mexico are among the region's major markets for wood-based panels, with Brazil leading the way due to its strong building and furniture industries. Brazil's government's housing programs have driven the construction of cheap dwellings, increasing demand for wood-based panels for interior and exterior purposes.
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