World Housing Growth to Drive Chipboard Boom

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Monday, May 12th, 2014
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The world market for chipboard is set to boom as housing construction recovers and the furniture industry expands, with Europe as the biggest producing region set to reap the lions’ share of the gains, a new report says.

Price growth will be limited, however, as consumption lags behind production, while Australia’s share of the market is set to remain unchanged at 1.2 per cent.

In its Particleboard in the Pacific Rim and Europe 2013-17 report, industry research firm BIS Shrapnel says based on current expansion plans and capacity utilisation rates, it expects worldwide production of chipboard throughout major producing countries to increase 73.6 million cubic metres in 2012 to 88.6 million in 2017.

Prices, meanwhile, will rise by five per cent and six perc ent in 2014 and 2015 respectively but slow thereon after as consumption – which is expected to rise from 72.2 million cubic metres in 2012 in major producing countries to 84.8 million in 2017 – fails to keep up with the projected growth in supply.

Leading the way will be Europe, where exports will double as countries such as Belarus, Bulgaria, Hungary, Latvia, and Russia ramp up output.

“The economic crisis hasn’t ceased for Western Europe, and in 2012 it was the only region with a GDP close to zero,” report author and BIS Shrapnel senior manager Bernie Neufeld said. “However, if there is one industry that has remained stable in the greater European region, it’s the particleboard production industry – and times are only expected to get better over the forecast period.”

“With prices also expected to increase over the forecast period, it’s a good time to be in the particleboard industry in Europe, and you can’t say that about too many industries in the region, sadly.”

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In its report, BIS says demand will be underpinned by continued expansion of the US market for new housing construction, which will drive not only economic growth but also demand for furniture and cabinet making, while residential building growth in South America and Asia would also help.

Outside of Europe, strong production rises are also expected in the Americas, while Asia will grow at a slower rate.

Australasia’s output, meanwhile, will grow at similar rates to the overall market.

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