Tropical Timber Market Report

Depreciating currencies against the US dollar is slowing affecting the furniture and wood-based product markets; material and product certification remain a priority; while research for alternative, sustainable materials to wood has intensified. ITTO shares more about the happenings in the wood industry around the globe.


Oil palm stems as a raw material for industry

In Malaysia, there is growing interest in investigating substitutes to supplement timber supplies from natural and planted forests.

The Malaysian Timber Council (MTC) has been playing a key role in highlighting the potential of Oil Palm Trunks (OPTs). 

Recently MTC conducted public discussions on the use of OPTs.

OPTs that come from palms felled during replanting could be an alternative source of raw material for the wood-based industry. Malaysia was one of the first to use OPTs to produce ‘palm wood’ and bio-composite products.

The commercial life of oil palms is considered to be 25 years meaning oil palm estates will fell and replant every 25 years. Malaysia has around 5.7 million hectares of oil palm and an estimated 80,000 to 100,000 ha is felled annually yielding about 18 million palm stems.

Palm stems are not easy to mill or utilise as the density varies at different parts of the stem being lower in the core and at the top of the stem compared to the base and outer part of the stem in the same way as in coconut palm stems.

Also, palm boards are very susceptible to fungal and insect attacks due to the high sugar and starch content. Research suggests that OPTs may be suitable for the manufacture of composite panel products.

In related news the Sarawak Timber Industry Development Corporation (STIDC) has embarked on programmes focusing on non-timber based materials for the timber industry such as bamboo. 

Deputy Chief Minister, Awang Tengah Ali Hasan, said the state government is committed to greater sustainable management of forest in view of the reduction in harvests from the state’s natural forest.

The domestic press in Sarawak has reported that Subur Tiasa Holdings will partner STIDC in developing of bamboo plantations and utilisation studies.


Sabah moves to restructure forestry sector

The new state government in Sabah, installed after general elections in early May, has clarified its position on the timber industry, especially the interim ban on log exports.

Sabah Chief Minister, Mohd Shafie Apdal, has said that among the various factors behind the decision to ban log exports was the need to break what has been termed ‘a Sabah timber cartel’ that allegedly monopolised the sector. 

He explained that the ban was part of a comprehensive restructuring of the state’s forestry sector.


Certified forest management unit in Sarawak

In response to a state directive that logging companies must be certified, Ta Ann, one of the big six of timber companies in Sarawak, has announced that its Kapit Forest Management Unit (FMU) has been awarded the Certificate for Forest Management (Natural Forest) under the Malaysian Timber Certification Scheme (MTCS), a scheme endorsed by the PEFC.

The certificate was awarded by SIRIM QAS International in June with a validity of three years after a two stage audit, a series of stakeholder consultations and a peer review.

Covering an area of 149,756 hectares, the Kapit FMU is located in the southern part of Kapit District and is the first FMU under Ta Ann Group to be certified. The FMU constitutes 44 percent of licensed concession area under Ta Ann Group which has a combined licensed area size of 337,996 hectares.

The certification of its Kapit FMU is an important step forward which will enable the Ta Ann Group to further increase its production of certified plywood products.



Government to review export duties

To boost exports the government plans to develop a number of incentives and review export duties for several sectors including the timber sector. The aim is to make domestic production more competitive to support growth in exports to help reduce the trade deficit.

In other moves, the Industry Minister, Airlangga Hartarto, will act on import duties to protect domestic manufacturers as he fears there could be a surge in imports of wood products from China because of the rise in US import duties.

The local media is reporting that the government is also preparing new incentives for small and medium enterprises especially in the furniture sector in order to increase the export competitiveness. 

One action will be to provide subsidies for Timber Legality Verification System certification.


Strong dollar improves export prospects

Prospects for Indonesia's wood product manufacturers are improving on the back of stronger world demand and the strength of the US dollar.

Indroyono Soesilo, Chairman of the Association of Indonesian Forest Concessionaires (APHI), said the stronger dollar works in Indonesia’s favour as exports are that much cheaper. 

As of May 2018, the value of Indonesia’s wood product exports was US$5.71 billion.


Indonesia and Austria strengthen trade in wood products

Indonesia trades FLEGT licensed wood products throughout the EU including to Austria. As of September 2017, the Austrian authorities reported that around 200 FLEGT licensed timber shipments had been received from Indonesia.

In order to strengthen the implementation of FLEGT license system the Ministry of Forestry, together with the Ministry of Foreign Affairs, hosted a workshop on ‘Strengthening Implementation of FLEGT License between Indonesia and Austria’.

Over the past five years Indonesia’s export of wood products to Austria has been dominated by furniture, handicrafts and wood-based panels and the trade has grown from US$444,000 in 2013 to US$2.5 million in 2017.


US the main export market for furniture

Abdul Sobur, Secretary General of Association of Indonesian Furniture and Handicraft Industry, said exports recorded good growth in the first half of this year and the main market for Indonesian furniture and handicraft was the US.

The total value of furniture and handicraft exports in the first half of 2018 reached US$1.3 billion, a year on year increase of nine percent compared with the same period last year.

This was achieved as Indonesian exporters had diversified into over 100 different markets largely due to the success of the IFEX exhibition in March.

In related news, he pointed out that, while the government has targeted furniture exports for 2019 at US$5 billion, comprising US$3.2 billion for furniture and US$1.8 billion for handicraft, this will be difficult to achieve because of the obstacles faced by manufacturers.

Among the most problematic obstacles are high bank interest rates, inadequate raw material supply, SVLK compliance and the complexity of importing raw materials. 

He called on the government to address burdensome regulations so the sector could grow.



Proposal for plantation log export

Zaw Min, Deputy Director General of the Forestry Department, has been quoted by the domestic press as saying the Forest Department has proposed allowing the export of logs from private plantation forests. 

Myanmar introduced a ban on natural forest log exports in April 2014.

Private forest plantations have been permitted since 2006 and extend over about 80,000 ha around half of which is teak and the balance other hardwoods. Currently, thinnings from plantations are utilised locally but these are of small diameter and domestic mills are better equipped to mill large natural forest logs.

Independent third party certification bodies ready to start work Analysts in contact with Myanmar exporters say the consensus amongst timber exporters is that it is increasingly obvious that the trade in teak products to EU is set to decline sharply. 

One exporter said that until the country has a verifiable chain of custody system which allows EU importers to satisfy the due diligence requirements of the EUTR trade will be hampered.

The exporter complained that, currently, even if exporters secure an export permit from Forest Department, which requires meeting their strict regulations, exports can be rejected in the EU as the authorities cite weak compliance with regulations.

Recently, a FLEGT advisor to the Forestry Department and the Ministry of Natural Resources and Environmental Conservation (MONREC) compiled a dossier on the supply chain from the forest to the point of export.

But currently there is no system in place to independently verify compliance along the supply chain.

In response to this, Barber Cho, Secretary of Myanmar Forest Certification Committee (MFCC), has indicated that independent Third Party Certification Bodies (CBs) will be ready to start the certification process in July this year.

He said the system and documentation are almost ready and training for the auditors has been completed. A ‘soft’ launch will take place in July.

To begin, there will be four certification bodies, three domestic entities and one international. 

However, he said, because such a system is new to Myanmar, it will take time for the CBs to reach full capacity. The performance of the CBs will be closely watched by the MFCC. 

He said he welcomes constructive cooperation and technical support from any organisations so that the third party certification process can move progressively to satisfy international requirement.

He also stressed that the priority of the MFCC is to enhance cooperation in legality verification with the FLEGT advisor to MONREC so as to build trust between all parties and create an environment where trade with the EU and other international markets can flourish.


A plea for more emphasis on investments

Statistics from Myanmar's Directorate of Investment and Company Administration show that, investments from China made up around one third of total investments in the financial year 2014-15. 

In contrast, investments by US companies accounted for less than one percent.

A Special Economic Consultant to Aung San Suu Kyi has called on the international community put more emphasis on helping Myanmar secure investments.

He said the Western media continues to intensify their criticism of the country. With abundant oil and gas reserves as well as a large young population Myanmar considerable potential to attract investment.



Van Mahotsav

Uttar Pradesh Chief Minister, Yogi Adityanath, officially launched the State’s participation in Van Mahotsav on 1 July and applauded the efforts of the residents of Uttar Pradesh for being a part of this tree plantation initiative.

Van Mahotsav is a tree planting festival held annually in India. 'Van' means 'forest' and 'mahotsav' means 'festival'. This tree-planting movement began in 1950. It has gained significant national importance and every year millions of saplings are planted across India in observation of Van Mahotsav week.

Adityanath began the State’s participation in the Van Mahotsav festival by planting a sapling at Barabanki. 

While addressing a gathering there, he said protecting the environment has always been his priority and he urged people to join his cause of environmental protection because Uttar Pradesh has a low forest cover at just nine percent, far below the national average of 33 percent.

Apart from the Forest Department, school and college students as well as officials from other government departments were asked to join the tree planting exercise. 


Plantation teak imports

Demand for imported logs has slowed due to the onset of monsoon which impacts building work, traders report supplies have also slowed. 

The strong dollar, rising for last three months, has been increasing the landed cost of imports so traders have cut back on orders.

The Indian Rupee has been sliding due to high oil prices and resultant heavy payments in foreign currencies. Because of this situation domestic wholesale prices for imported teak keep rising but the cost and freight prices remain flat. 

The market for teak and other wood products has been affected for months by home sales.



Labour shortages and higher raw material costs dampen growth

Japan’s economy now appears to be faltering due mainly to the rising costs of labour, imported raw materials and oil. But weaker economic indicators did not deter the Bank of Japan (BoJ) from maintaining its positive assessment of the economy.

The BoJ Governor went on record saying the two percent inflation target still stands which analysts have interpreted as meaning the current monetary policy will be sustained.

The BoJ revised up its assessment for capital expenditure in three of the nine regions of Japan, attributing this to company spending on automation as a way to overcome the acute shortage of workers. 

On the downside, it said some companies expressed concern about the risk of an escalation of the trade dispute between the US and China.

The labour shortage in Japan is becoming a major concern in the construction and manufacturing sectors and the latest population data have done little to raise hopes for a solution. 

Japan’s population declined at fastest pace yet to 125.2 million according to the most recent census due mainly to a record low birth rate. 

This, combined with the rapidly aging population has prompted the government to launch a study to find ways to support families and reverse the downward trend in the birth rate.


Yen gives up role as safe haven currency

The US dollar is currently at a six-month high against the Japanese yen. The dollar’s strength relies on the good performance of the US economy and by US inflation data which has encouraged capital inflows.

The yen weakness against to dollar at a time when there is volatility in the global economy suggests traders believe the dollar is a safer currency than the yen as trade volatility is likely to worsen.


Thousands of homes lost in floods

As of 14 July the death toll from the devastating floods in western Japan was above 200. 

The government’s Chief Cabinet Secretary has announced that 204 people were now known to have died with 28 still missing in the worst storm for 36 years.

Almost 15,000 people are in evacuation centres and many of these people have no home to return to. At the height of the storm evacuation orders were issued to around six million people.

Authorities are still not clear on the full extent of the damage. Thousands of homes have been totally or partially destroyed and infrastructure has been severely damaged. A government spokesperson has said it will take years for recovery.


Furniture imports

The total value of Japan’s April 2018 imports of wooden office, kitchen and bedroom furniture was largely unchanged from the previous month or from April 2017.

Despite the cyclical trend in wooden bedroom furniture imports, a category that accounts for a major share of total wooden furniture imports, year on year there has been little change in the total value of wooden furniture imports.


Office furniture imports (HS 940330)

The rising trend in wooden office furniture imports from the third quarter of 2017 came to an end in April 2018.

The value of April imports were flat year on year and down 14 percent compared to the value of March imports. In April 2018 the big losers were shippers of wooden office furniture in Portugal, Poland and the US.

Japan’s April imports from China, the number one supplier, were unchanged from a month earlier and accounted for 54 percent of all wooden office furniture imports. The other main suppliers were Switzerland nine percent and the US 8.5 percent.


Kitchen furniture imports (HS 940340)

Year on year, the value of Japan’s April 2018 imports of wooden kitchen furniture were 11.5 percent higher but compared to levels in March 2018 they were down eight percenet.

There has been a steady decline in wooden kitchen furniture imports since February this year but compared to the first four months of 2017, imports are higher.

Manufacturers in the Philippines have consolidated their position as the number one supplier of wooden kitchen furniture to Japan, accounting for 47 percent of April 2018 import values.

Following closely at a 36 percent share of April imports by Japan is Vietnam. Shippers in China added a further 10 percent to imports bring the total for the top three shippers to 93 percent.


Bedroom furniture imports (HS 940350)

The dramatic slide in imports of wooden bedroom furniture was arrested in April as the value of imports did not change compared to levels in March. 

Year on year and month on month, the value of Japan’s imports of wooden bedroom furniture remained flat.

Every year wooden bedroom furniture imports peak in the first half of the year only to drop sharply in the second and third quarters of the year. 

On the basis of past trends, a further decline in bedroom furniture imports can be expected over the next few months.


Tight supply of particleboard for flooring

Demand for 2x6 particleboard for flooring was busy last year then it simmered down in early this year. 

The demand is rising again now with increasing starts of high rise condominiums and Olympic related constructions.

The manufacturers have orders for other items for building materials so they have no time to build up inventory of 2x6 sheet. Actually the inventory now is much lower than this time of last year.

There are many plans of large condominiums then construction of many facilities for the 2020’s Olympic Games will start in summer.


Stabilising supply of Vietnamese plywood

Tight supply of eucalyptus plywood from Vietnam is now easing after purchase by China and Korea slows down.

Operation of producing plants is not uniform in securing raw materials and financial stability so the future supply situation is not optimistic.

Veneer supply in Vietnam is stabilising so the volume for Japan is sufficiently secured. Export prices stay up high but at the same time, any sharp increase is unlikely. 

The importers and wholesalers give priority to secure enough volume rather than the prices for coming fall demand increase.



RMB depreciation

Since March the Chinese currency has depreciated by around 6%, taking it down to almost RMB6.7 to the dollar. 

This decline should be seen against the background of a weakening Chinese economy and the strengthening of the US dollar. 

Analysts write that further weakness is likely if China uses exchange rates to support exports in its ‘trade war’ with the US.

If indeed the Chinese authorities allow further currency depreciation the prospects for continued global growth will be undermined.


Zhangzhou Customs—Phytosanitary certificates for imported logs—now to be sent electronically

The Zhangzhou Customs Administration in Fujian Province has announced that it no longer requires paper phytosanitary certificates for logs imported through Zhangzhou Port.

According to China Customs, to promote implementation of a paperless system for commodity imports, phytosanitary certificates should be provided electronically for imported logs. 

As a result Chinese importers will require foreign suppliers to provide electronic phytosanitary certificates as soon as logs are shipped so electronic documents can be submitted for Customs examination.


National standard for wooden structures

A National Standard on Wooden Structure Design (GB50005-2017) has been approved by the Ministry of Housing and Urban and Rural Development and will be effective from 1 August 2018. 

The previous National Standard on Wooden Structure Design (GB50005-2003) will be abolished at the same time.

The main differences between the old and new standard focus on:

•grading of wood quality and strength

•utilisation of a wider range of domestic and imported timbers

•provision of strength values for imported and domestic timbers

•design provisions for square timber, logs and composite wood products

•design provisions for glued and light wood structures

•improved rules for stability and connection designs for wooden structure members

•design provisions for seismic events, fire resistance and durability


Vietnam the top source of woodchips

China’s woodchip imports in 2017 amounted to 11.45 million cubic metres valued at US$190 million, a year on year decline of two percent in volume and 0.3 percent in value.

Vietnam was the main woodchip supplier to China in 2017 accounting for 41 percent of total woodchips imports. Imports from Vietnam totalled 4.7 million tonnes in 2017, a year on year increase of 12 percent.

The second ranked supplier of woodchips was Australia at 3.85 million tonnes, accounting for 34 percent of the national total. However, in 2017 a year on year decline of four percent was recorded for woodchip imports from Australia.

Average prices for imported woodchips from Vietnam fell two percent but from Australia rose two percent in 2017, which is the main reason for the increase in China’s woodchips imports from Vietnam.


Plywood prices slide

Plywood prices in the domestic market have been falling recently. When questioned dealers said that prices have been heavily affected by the ‘off-season market’ this year and that the number of orders was far less than in the first half of the year.

As a result of the decline in prices, many businesses launched promotional campaigns to generate cash flow.

Industry analysts say the current ‘off-season’ downturn is more obvious this year and has been exacerbated by the continued pressure on construction companies by environmental protection departments and that this has dampened demand.



Slow growth in EU wooden furniture and joinery sectors in 2017

There was only very slow growth in both the EU wood furniture and joinery sectors during 2017. While production and consumption gained momentum in parts of continental Europe, particularly in Eastern Europe, this was offset by a significant slowdown in the UK and stasis in Germany.

Growth in the EU door sector was considerably more buoyant than in the window and furniture sectors in 2017.

While wood made up some lost ground against plastics in these sectors, market share was being lost to metal products.

These are the main conclusions to be drawn from analysis of newly released Eurostat PRODCOM data which provides a snapshot of the production and consumption value of wood furniture and joinery products in the EU in 2017.


No growth in wood furniture production in 2017

The value of EU wood furniture production was €40.3 billion in 2017, no change from the previous year and still 20 percent down on the level prevailing before the financial crises in 2008.

A slowdown in production in the UK offset gains in Poland, Spain, and Lithuania. Production in Italy and Germany, the two largest manufacturing countries, and in France and Romania was broadly flat in 2017.

EU consumption of wood furniture was €37.6 billion in 2017, a gain of two percent compared to 2016. During 2017, consumption was stable (at €9.4 billion) in Germany, the largest market, and rising in Italy (+3% to €5.2 billion), France (+1.5% to €4.3 billion), Spain (+7% to €2.2 billion), Netherlands (+30% to €1.5 billion), Poland (+15% to €1.4 billion) and Sweden (+2.5% to €1.1 billion).

However, wood furniture consumption fell six percent to €6.5 billion in the UK and five percent to €870 million in Belgium.

After flat lining in 2016, the value of EU imports of wood furniture from non-EU countries increased seven percent to €6.16 billion in 2017. Imports from China, by far the largest external supplier fell four percent in 2016 but recovered 0.7 percent to 3.08 billion in 2017.

In recent years China’s competitiveness in the EU wood furniture market has been impeded as prices have risen on the back of growing domestic demand and new laws for pollution control pollution in China.

EU furniture importers also continue to question the variable quality of product imported from China and some have struggled to obtain the legality assurances required for EUTR conformance when dealing with complex wood supply chains in China.

The main beneficiaries of rising EU wood furniture imports in 2017 were other European countries including Ukraine, up 67.7 percent to €133 million, Bosnia, up 14.9 percent to €218 million, and Serbia, up 13.7 percent to €127 million.

EU imports of wood furniture from tropical countries increased 3.5 percent to €1.72 billion in 2017, reversing a 2.5 percent decline the previous year.

Vietnam is the dominant supplier of furniture to the EU, although imports were flat in 2016 and 2017 after rising 40 percent in the previous two years. Imports from Vietnam declined 0.7 percent in 2016 and then increased just 0.5 percent to €724 million in 2017.

EU imports of wood furniture from Indonesia increased two percent to €309 million in 2017, following a six percent decline the previous year. 

Imports from Malaysia increased 11 percent to €180 million, EU imports from Malaysia recovered by 10.7 percent to reach €203 million last year. Imports from Thailand fell 3.4 percent to €61 million.

Recent survey work undertaken by the ITT0-IMM in highlights that, to some extent, direct competition between furniture suppliers in the various South East Asian countries is limited by market differentiation.

With the rapid decline of availability of natural forest teak from Myanmar, Indonesia is now best placed to supply a wide range of outdoor furniture products, particularly due to relatively abundant plantation teak supplies.

Indonesia's long woodworking tradition has also meant it has gained a reputation for supply of good quality specialist hand-made furniture, a niche market in the EU where it competes most directly with India.

By contrast, the Vietnamese furniture sector has gained a reputation for supply of large volume mid-range products, both for exteriors and, increasingly, for interior use, and is importing a wide range of wood from around the world to feed this production.

The Vietnamese furniture industry is regarded by EU importers as technically more evolved than most other Asian producer countries and increasingly able to supply products to high European quality standards.

Malaysia also supplies high quality products but offers a much smaller range than Vietnam with a heavy focus on rubberwood and other plantation species.

While these various external suppliers now play an important role in specific sections of the EU furniture market, the domestic industry remains very dominant. The share of domestic manufacturers in total EU furniture supply declined only slightly between 2013 and 2017.

In 2017, domestic manufacturers accounted for 86.7 percent of the total value of wood furniture supplied into the EU market, down from 87.5 percent in 2016 and 88.6 percent five years before.


5% growth in wood door supply to the EU in 2017

Eurostat PRODCOM data reveals that the total value of wood doors supplied to the EU increased by five percent to €7.12 billion in 2017. Despite the increase, the value of wood doors supplied to the EU in 2017 was still more than 25 percent down on the level prevailing before the global financial crises.

Most new wood door installations in the EU comprise domestically manufactured products. The EU’s domestic production increased 4.9 percent to €6.78 billion in 2017. 

There was significant variation in the performance of the wood door sector in EU countries in 2017.

Production in Germany, the largest wood door manufacturing country, was stable at €1.30 billion during the year while production in the UK continued to slide, by two percent to €840 million.

However, production increased sharply in Italy (rising 12 percent to €910 million), France (rising five percent to €640 million), Spain (rising 14 percent to €540 million), Poland (rising 10 percent to €510 million) and the Netherlands (rising 30 percent to €250 million).

Wood door imports into the EU increased by just 0.3 percent to €341 million in 2017. Imports accounted for 4.8 percent of the total euro value of wood door supply to the EU in 2017, down from five percent the previous year.

Most of the gains in EU door imports in 2017 were from other temperate countries including Norway (+7% to €16 million), South Africa (+16% to €12 million), Bosnia (+29% to €7 million) and Ukraine (+50% to €7 million).

Imports from UAE, becoming more important as a wood processing hub, increased from negligible levels to €5.4 million.

However, imports from China, the largest external supplier, fell two percent to €111 million in 2017.

The total value of EU imports of wood doors from the tropics fell six percent to €159 million in 2017. This was mainly due to a decline in imports from Malaysia (-9% to €38 million) and Brazil (-19% to €13 million). The value EU wood door imports from Indonesia also fell, but by only 3.8 percent to €102 million in 2017.

The European wood door industry is now dominated by products manufactured using engineered timber driven by requirements to comply with higher energy efficiency standards and efforts to provide customers with more stable products and long-life time guarantees.

Another key trend is towards composite doors with a steel reinforced uPVC outer frame with an inner frame combining hardwood and other insulation material.

These new products are designed to combine strength, security, durability, high energy efficiency, with a strong aesthetic.

There may be a place for tropical hardwoods in the design of these products with manufacturers looking to combine high quality, consistent performance, regular availability, and good environmental credentials with a competitive price.

EU market for wood windows flat in 2017 There was little growth in the market for wood windows in the EU in 2017. The total value of wood windows supplied to the EU increased only 0.7 percent to €6.07 billion in 2017 following a 2.8 percent decline the previous year.

The supply of wood windows to the EU is overwhelmingly dominated by domestic production which increased 0.7 percent to €6.07 billion in 2017. Imports from outside the EU accounted for only 0.5 percent of total EU wood window supply in 2017.

Italy has maintained its position as the largest window manufacturer in the EU, with production rising around 7.2 percent to €1.39 billion in 2017. Production in Poland continued to rise during the year, by seven percent to €704 billion.

In contrast, wood window production in most large western European markets declined in 2017, including Germany (-1% to €802 million), France (-1% to €525 million), Sweden (-5% to €420 million), UK (-12% to €299 million) and the Netherlands (-4% to €254 million).

Imports of wood windows from outside the EU fell by 5.3 percent in 2017 to €31.4 million, continuing the downward trend of the previous year. EU imports of wood windows derive mainly from neighbouring European countries, including Norway, Bosnia and Switzerland.

Only a very limited, and highly variable, quantity of wood windows is imported into the EU from tropical countries.

The value of EU imports of wood windows from tropical countries fell 32 percent to €3.17 million in 2017. Typically, 50 percent to 70 percent of wood windows imported in the EU from the tropics each year derive from the Philippines and are destined for France and Belgium.

While tropical countries are not significantly engaged in the EU market for finished windows, this sector is of interest as a source of demand for tropical wood material.

From this perspective, a notable trend in the EU window sector—as in the door sector—is towards use of engineered wood in place of solid timber. 

This is particularly true of larger manufacturers producing fully factory finished units that buy engineered timber by the container load.

Increased use of engineered wood is closely associated with efforts by window manufacturers to meet rising technical and environmental standards, provide customers with long lifetime performance guarantees and recover market share from other materials.

Increased focus on energy efficiency means that triple glazed insulating window units with very low U-factors are now more common than double-glazed units in Europe. 

These units demand thicker, more stable and durable profiles that in practice can only be delivered at scale using engineered wood products.

The quality and engineering of wood windows has undergone a revolution in the EU in recent years so that manufacturers are now able to deliver products with many of the benefits previously reserved only for the best quality tropical hardwood frames using softwoods and temperate hardwoods.

Factory-finished timber windows are given a specialist spray-coated paint finish for even and durable coverage which might only need redoing once a decade. 

The lifespan of factory-finished engineered softwood frames is now claimed to be about 60 years, while thermally or chemically modified temperate woods can achieve around 80 years.

Nevertheless, smaller independent joiners producing bespoke products in low volumes still tend to rely on solid timber purchased from importers and merchants to manufacture window frames.

Tropical woods such as meranti, sapele and iroko continue to supply a high-end niche in this market sector, competing directly and often successfully with oak, Siberian larch, and western red cedar.

The apparent stasis in EU production of wood windows during 2017, a year when overall construction activity in the region is estimated by Euroconstruct to have risen by 3.5 percent, implies some loss of market share.

The Eurostat PRODCOM data provides evidence for this showing that between 2014 and 2017 total EU consumption value for doors and windows increased 26 percent in aluminium and 28 percent in steel. The consumption value for wood increased only four percent during this period, while consumption of plastic stagnated.

Overall, the share of wood in the total value of EU door and window consumption fell from 30 percent to 28 percent between 2014 and 2017, while the share of aluminium increased from 25 percent to 28 percent, steel increased from 14 percent to 16 percent, and plastic decreased from 31 percent to 27 percent.

This highlights that while wood may be making gains in relation to plastic products in the EU market for windows and doors, it is losing share to metal products.

Aluminium is becoming a particularly prominent competitor. Aluminium has always remained the default windows product in the commercial market but over the last five years the material has enjoyed considerable resurgence within the residential window and door market.

An important driver behind this has been aluminium bifold and sliding doors as consumers demand greater space and light within living areas. Another factor is the demand for lower maintenance and greater strength in light weight frames for high energy efficiency double and triple glazed units.

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