ENGINEERED WOOD MARKET ANALYSIS

Engineered Wood Market Size and Trends

The engineered wood market is estimated to be valued at USD 7.65 Bn in 2024 and is expected to reach USD 12.53 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 7.3% from 2024 to 2031.

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The market has been witnessing steady growth over the past few years driven by increasing residential and non-residential construction activities globally. The demand for engineered wood is expected to increase significantly during the forecast period driven by rising consumer preference for sustainable and eco-friendly construction materials. The market is gaining more acceptability over solid wood owing to advantages such as dimensional stability, strength, uniformity, and ability to be easily machined into various shapes and sizes. Additionally, supportive government policies and regulations pertaining to use of engineered wood especially in developed markets will further aid the market expansion through 2031.

Growing demand from construction industry

The engineered wood market is expected to witness significant growth in demand driven mainly by the robust growth of the construction industry globally. There has been a growing acceptability of engineered wood products such as plywood, oriented strand board (OSB), glulam, cross-laminated timber (CLT). and nail laminated timber (NLT) in the construction of buildings with wood-frame construction gaining more popularity over concrete and steel structures. The engineered wood products provide advantages over sawn wood as they can be manufactured in large dimensions with more consistency and are more durable and stronger.

Many countries across the world are aiming to reduce the carbon footprint of the construction industry by promoting the use of wood-based materials in construction which is driving the demand for engineered wood. Various government policies and building codes are also encouraging the use of mass timber products made of engineered wood in commercial and residential construction. The growing construction of multi-family residential buildings and non-residential buildings will significantly boost the demand for I-beams, laminated veneer lumber, and nail laminated timber which are widely used in floors, walls, and roofing structures in wood-frame buildings. Many developers are also opting for wood-frame construction for its quicker construction time, ease of installation, and cost-effectiveness. With rapid urbanization leading to building construction activities worldwide, the engineered wood market is expected to grow substantially in the coming years.

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Diminishing forest resources

Another key driver contributing to the rising demand of engineered wood is the diminishing natural forest resources and the need for sustainable utilization of wood resources. Over the past few decades, there has been growing concerns regarding deforestation and its impact on the environment. Extraction of wood from natural forests is witnessed to decline sharply due to shrinking forest areas and implementation of stricter wood procurement policies to promote afforestation. However, the requirement of wood as a construction material continues to increase. Engineered wood products help overcome this challenge of limited natural wood resources as they utilize wood residues and by-products which would otherwise be wasted. Using wood residues efficiently through manufacturing processes of engineered wood extends the life span of forest resources.

The engineered wood market provides an avenue to make the optimal use of small-diameter trees, wood wastes, and other wood by-products. It helps avoid further depletion of natural forests for construction needs.