Increasing demand from construction industries and downstream wooden structural component manufacturers will benefit the industry.
Melbourne, Australia (PRWEB) August 23, 2014
Operators in the Fabricated Wood Manufacturing industry in Australia have suffered over the past five years due to weak demand from downstream construction industries and manufacturers. Industry revenue is estimated to fall at an annualised 4.4% over the five years through 2014-15. Falling demand for particleboard, medium-density fibreboard (MDF), timber veneers and plywood over this period has “contributed to the industry's declining revenue and subsequent drops in domestic production,” according to IBISWorld industry analyst Spencer Little. Industry operators are estimated to produce 1.5 million cubic metres of these products in 2014-15, down from 1.7 million cubic metres in 2009-10.
Fabricated timber manufacturers have faced rising competition from import markets that can offer goods at lower prices. “Structural timber products have also faced growing instances of substitution from alternative materials such as plasterboard and concrete over the past five years, particularly in non-residential construction markets,” says Little. However, industry performance has rebounded over the past two years, following a greater number of residential housing commencements and greater demand for timber products from commercial and industrial building construction companies. As a result, revenue is estimated to increase by 2.4% in 2014-15, to reach $1.3 billion. The industry has a medium level of market share concentration. Major players include Fletcher Building Limited, Building Supplies Group Holdings Pty Limited and Boral Limited.
Despite performing poorly over the past five years, the Fabricated Wood Manufacturing industry is expected to rebound slightly over the next five years. Increasing demand from construction industries that require fabricated timber products such as particleboard and MDF, and from downstream wooden structural component manufacturers that use industry products as inputs, is anticipated to benefit industry operators over this period. These trends are also projected to contribute to rising domestic production of particleboard, MDF, timber veneers and plywood, following declining volumes over the past five years. However, rising import competition is expected to continue to characterise the industry and limit revenue growth.
For more information, visit IBISWorld’s Fabricated Wood Manufacturing industry in Australia report page.
Companies in the industry primarily manufacture veneers and plywood, as well as wood boards and sheets from reconstituted wood fibres such as wood chips, sawdust, wood shavings, timber slabs or off-cuts. Firms that primarily manufacture timber and non-timber laminates are also included in the industry.
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