PLYWOOD PREDICTED TO PUSH FORWARD

THE WORLDWIDE market for plywood is estimated to grow 6.2% annually over the next five years, rising from a market size of $54.2 billion in 2022 to $73.3 billion by 2027, according to a recent forecast by MarketsandMarkets.

Based on application, construction is expected to be the largest segment during the forecast period. Over the medium term, construction will be a growth engine for the global economy, with growth averaging 4.4% between 2020 and 2025. The global construction market is expected to grow by $4.5 trillion between 2020 and 2030, reaching $15.2 trillion. Of this total, $8.9 trillion will be in emerging markets in 2030.

The positive predictions are welcome news to manufacturers. “Being in the trenches of the panel industry, we tend to look at the glass half empty,” says Tyler

Freres, VP of Freres Lumber, Lyons, Or. “I think that 2023 is going to start with a very challenging economic environment. We need to see some moderation in inflation, a stabilization of the Fed’s interest rate hikes, and indications from consumers that they are willing to invest in housing at higher rate levels. A modest decrease in housing starts, say down to the 1.3 million level, is something that the producers can adjust to. A more significant reduction in starts would be difficult.”

He notes that the last three years for panels have been a series of six-month boom-and-bust cycles, alternating in the beginning and end of each year.

According to the forecast, growth is projected to be concentrated in a few nations. China, India, the United States, and Indonesia should account for 58.3% of worldwide building growth between 2020 and 2030. Over the next decade, 10 markets will likely contribute about 70% of the $4.5 trillion in growth.

Because softwood plywood is used mainly in the construction industry for structural purposes, demand for softwood plywood should considerably outpace demand for hardwood plywood.

The Asia Pacific region has become the largest market for plywood across the globe. China accounted for the largest share of 80.0% of the Asia Pacific plywood market in terms of value. India and China have experienced close to double-digit Gross Domestic Product growth in recent years, as well as a population boom. The stable economy and growing building and construction industry has augmented the growth of plywood in India and China. Furthermore, the furniture sector is one of the main consumers of plywood in India.

During the 2018 to 2023 period, it is predicted that the India furniture market by commercial sector will experience annual growth of 11.97%. India is the fourth-largest consumer of furniture worldwide and the fifth-largest producer of furniture. The Indian furniture industry is estimated to be worth $8 billion and represented 0.5% of the GDP in 2022. BP