3.1. Market Overview
3.2. Plywood and Veneer
3.3. Particleboard
3.4. Medium Density Fibreboard (MDF)
3.5. Oriented Strand Board (OSB)
3.6. Hard and Soft Fibreboard
3.7. Laminated Veneer Lumber (LVL)
3.8. Other Panel Products
The wood based panel market in the Asia Pacific region has grown dramatically over the last ten years and, between 1990 and 1995, both production and consumption of wood based panels grew at over 10% per annum, when the comparative growth rates in the rest of the world were either between 2.0% and 2.5% or, in the case of Africa and the countries of the former USSR, growth rates were negative.
However the Asia Pacific region contains nearly two thirds of the world's population and there were many different economic performances and growth rates within the region over the period 1990 to 1995. Japan's economy was very quiet throughout the period and wood based panel consumption grew at only 2.0% per year. China's economy, on the other hand was booming and the consumption of wood based panels grew by 20% per year throughout the period.
Wood based panel consumption in the South East Asian countries grew at over 20% per year during the period, and this was matched by a period of frantic activity in the creation of new productive capacity, which is continuing into the next five year period. South Asian countries also registered a healthy growth level of 9.0% per year in panel consumption, New Zealand consumption grew by 10% per year and Australia by 5.5% per year over the period.
There were major differences between the demand for different wood based panels however, with a marked slowdown in the demand for plywood and veneer, which grew at only 3% per year outside China, where demand growth appears to have been 20% per year.
Particleboard demand averaged 15% per year throughout the region, with demand in China reaching 22% per year; demand in Indonesia, Malaysia, Thailand and India increasing by between 20% and 30% per year; demand in Republic of Korea increasing by 12.5% per year and demand in Japan increasing at only 7% per year.
Medium density fibreboard (MDF) was the star growth performer however with an average growth rate of 30% per year throughout the region between 1990 and 1995. The consumption of MDF in China grew by an overall 700% in the period; consumption in South East Asia grew by 40% per year; in North Asia consumption grew by 30% per year; in Oceania it grew by 20% per year and in South Asia it grew by 16% per year.
Demand for other forms of fibreboard grew by around 5% per year in China (which accounted for roughly 50% of the total demand), and by about 4% in the rest of the Asia Pacific region.
Oriented Strand Board (OSB) and Laminated Veneer Lumber (LVL) were new products introduced to the Asia Pacific region during the 1990 to 1995 period, and they have made comparatively small inroads into the structural board market to date.
The Plywood and Veneer market remains the dominant feature of the Asia Pacific wood based panel scene, in both volume and value terms. Plywood and Veneer Imports by the six major importers listed in Table A.3., accounted for 11.1 million m³ in 1995, or 78% of the total panel imports of 14.2 million m³. Plywood and Veneer exports by Indonesia and Malaysia alone, out of the six major exporters, accounted for 12.5 million m³ in 1995, or 82% of the total panel exports of 15.2 million m³.
Tables 1 to 25 of the main tables annexed to this report give a detailed picture of the production, imports and exports of all wood based panels, for all the major countries of the Asia Pacific region over the period 1990 to 1995.
In China (Table 1), the enormous apparent increase in the plywood production figures from 1994 to 1995, from 2.6 to 7.6 million m³, was due to the inclusion (by the Chinese Academy of Forestry), from 1995, of all production data from plywood mills outside the state sector. Previous production data was obviously heavily understated, but no exact figures are currently available. The 1995 figures show a plywood and veneer consumption level of 9.94 million m³, of which 24% was imported.
The Japanese plywood & veneer figures (in Table 2), portray a picture of steadily declining plywood production over the period 1990 to 1995, with increasing plywood imports and a relatively static or gently declining total consumption level. This was due partly to the very low levels of economic growth during the period, and partly to the substitution of certain plywood applications by other wood based panels (particularly thin MDF and a small but growing interest in OSB).
Other major plywood markets in the region (such as Republic of Korea and Taiwan Province of China), show a similar pattern to that of Japan, with declining local production being replaced by increasing imports, with either little growth or an actual decline in plywood & veneer consumption over the period.
Indonesia (Table 7) remains the dominant producer of plywood in the region, but with an almost stagnant regional demand level, the Indonesian production levels have been stuck at around 10 million m³ per year since 1991, and export levels have stayed at around 8.6 to 8.9 million m³ per year over the same period.
Malaysia (Table 8) has increased its plywood & veneer production from 1.8 million m³ in 1990 to 4.5 million m³ in 1995, a remarkable expansion rate of over 20% per year. Exports have similarly expanded from 1.4 million m³ in 1990 to 3.7 million m³ in 1995, a growth rate of almost 25% per year. Due partly to a stagnant or declining market in North Asia, and partly to the declining availability of peeler logs, this expansion is unlikely to continue.
Australian production of plywood & veneer increased a little from 125,000 m³ to 145,000 m³ over the period, with 31,000 m³ to 37,000 m³ imports and virtually no exports. New Zealand plywood & veneer production rose from 150,000 m³ in 1990 to 380,000 m³ in 1995, with plywood exports increasing from 20,000 m³ to 68,000 m³.
Indian production of plywood remained steady at about 360,000 m³ during the period, with exports rising from 9,000 m³ to 38,000 m³ by 1995, leaving about 90% of the plywood for domestic consumption. Pakistan had a small production of about 15,000 m³ per year, all for domestic use.
A noticeable trend in the region's Northern markets is in the increasing use of imported softwood plywood (from New Zealand, North America and Europe), and a steadily increasing interest in OSB as a possible substitute for some plywood applications, particularly in Japan, Republic of Korea, Taiwan Province of China and Singapore.
Particleboard consumption in the Asia Pacific region expanded from 4.9 million m³ in 1990 to 9.9 million m³ in 1995, a growth rate of 15% per year. The production of particleboard in the region grew from a level of 4.2 million m³ in 1990 to 9.6 million m³ in 1995, a very healthy growth rate of 18% per year, but not quite enough to catch up with the growth of demand. The apparent regional deficit shrank from 700,000 m³ in 1990 to 300,000 m³ in 1995, and with a probable installed capacity of 11.75 million m³ by 1998, the deficit could disappear shortly.
China (Table 1) is the largest particleboard producer and consumer in the Asia Pacific region, with production levels which have increased from a probable 1.5 million m³ in 1990 to 4.4 million m³ in 1995. A high proportion of this production capacity (possibly as much as 50%) comes from several hundred very small locally made plants with capacity ratings of 3,000 to 5,000 m³ per year, producing boards of very variable quality from local wood waste or agricultural residues. The import levels of particleboard are very small as a percentage of consumption (about 1.25%).
Japan (Table 2) has expanded its particleboard production from 1.0 million m³ in 1990 to 1.25 million m³ in 1995, and the particleboard consumption has increased from 1.17 million m³ in 1990 to 1.65 million m³ in 1995, a growth rate of 7% per year which is three times the growth rate of Japan's consumption of wood based panels in general.
Republic of Korea's domestic production of particleboard expanded at more than 25% per year between 1990 and 1995, from 165,000 m³ to 548,000 m³ per year. Imports also increased and total consumption of particleboard rose from 557,000 m³ in 1990 to 1.0 million m³ in 1995, a growth rate of 12.5% per year.
Taiwan Province of China's particleboard consumption was small by comparison and rose to 300,000 m³ by 1995. China's Hong Kong SAR and Singapore were small importers and exporters of particleboard, with even smaller domestic consumption.
Indonesia increased its particleboard production from 310,000 m³ to 850,000 m³ over the same period, and exports rose from 103,000 m³ to 300,000 m³. Domestic consumption therefore increased from 207,000 m³ in 1990 to 550,000 m³ in 1995, a growth rate of about 22% per year. Though Malaysia's particleboard production increased from 90,000 m³ in 1990 to 400,000 m³ in 1995, exports also rose from 41,000 m³ to 250,000 m³ over the period, with a net increase in domestic consumption from 49,000 m³ to 150,000 m³.
Thailand's production of particleboard rose from 60,000 m³ to 550,000 m³, and exports went from zero to 222,000 m³ over the period. This resulted in net domestic consumption increasing from 60,000 m³ to 328,000 m³. The Philippines consumption level of particleboard also rose from 6,000 m³ in 1990 to 70,000 m³ in 1995.
Australia's particleboard production increased from 723,000 m³ to 864,000 m³ between 1990 and 1995, most of which (92 to 96%) was for domestic consumption. New Zealand production, by comparison, stayed around 170,000 m³ for the whole period, with exports increasing from 35% to 72% of total production.
India's particleboard production and consumption increased fourfold from 100,000 m³ in 1990 to 400,000 m³ in 1995. Pakistan production and consumption stagnated at around 54,000 m³ to 57,000 m³ per year.
Total consumption of MDF in the Asia Pacific region rose from 1.1 million m³ to 3.7 million m³ between 1990 and 1998, a heady growth rate of 28% per year. The production levels in the region rose almost as fast, from 1.1 million m³ in 1990 to 3.4 million m³ in 1995, a growth rate of about 26% per year.
Production of MDF in China apparently rose from 87,000 m³ in 1990 to 589,000 m³ in 1995, though the 1990 figure has not been adjusted for possible non-state sector production. The relatively small levels of imports and exports indicate that China appears to have a small residual demand deficit in MDF, but this appears to be growing larger each year, as the economy expands.
Japan's production of MDF increased from 256,000 m³ to 400,000 m³ over the period, but imports increased even faster, from 87,000 m³ to 500,000 m³ between 1990 and 1995. The apparent consumption levels therefore rose from 343,000 m³ to 900,000 m³ over the period, a net growth rate of about 21% per year. Though exact data is not available, a large part of this remarkable increase was due to product substitution, by thin MDF replacing thin plywood in many furniture and joinery applications.
Production of MDF in Republic of Korea also increased rapidly, from 158,000 m³ in 1990 to 590,000 m³ in 1995. Imports increased up to 1994 but then dropped back to 1990 levels, leaving a net increase in consumption levels from 254,000 m³ in 1990 to 655,000 m³ in 1995, a growth rate of about 20% per year.
Taiwan Province of China has no MDF production capacity, but imports rose from zero to 376,000 m³ by 1995. China's Hong Kong SAR and Singapore were once again playing the roles of both importer and exporter, with small levels of domestic consumption.
Indonesia started the period with zero MDF capacity, but by 1995 had a production level of 100,000 m³ and a much bigger capacity in the pipeline. Malaysia's production of MDF rose from 50,000 m³ in 1990 to 350,000 m³ in 1995, and with some 250,000 m³ exported, domestic consumption has risen from 50,000 m³ to 100,000 m³.
Thailand also had zero capacity in 1990, but increasing to 300,000 m³ by 1995, with 117,000 m³ exported, and 183,000 m³ consumed domestically. Neither Philippines or Singapore have any production capacity but both countries import small quantities.
Australia increased its MDF production fourfold over the period, from 108,000 m³ in 1990 to 436,000 m³ in 1995. Australia is also an active importer and exporter of MDF, and its domestic consumption increased from 154,000 m³ in 1990 to 510,000 m³ by 1995, representing a growth rate of nearly 28% per year over the period.
New Zealand was one of the earliest producers of MDF in the Asia Pacific region, and increased production from 374,000 m³ to 583,000 m³ between 1990 and 1995. The majority of its production of MDF is still exported, but domestic consumption increased from 109,000 m³ in 1990 to 260,000 m³ in 1995, which is a growth rate of almost 20% per year. India and Pakistan both produce small quantities of MDF for their own consumption.
Though this product is a major member of the wood based panel family in North America, and has a growing presence in Europe, it is currently very little used in the Asia Pacific region. There is a small pilot plant in China but it is being used for standard particleboard at present, and though there are other plants reported to be in the pipeline in China, Indonesia and Thailand, none of them appear to be confirmed projects.
In North America, OSB is a serious competitor for many traditional plywood applications, and has captured a large proportion of the structural panel market, particularly in housing applications. Because it does not need large diameter roundwood as a raw material, and its production costs are very much lower than plywood, the product should have a strong market potential in North Asia, particularly in Japan and China, which are major per capita consumers of plywood. In 1995 Japan imported about 260,000 m³ of OSB and has also imported a large number of prefabricated housing elements containing OSB panels. Small quantities have also been imported by China, Republic of Korea, Taiwan Province of China and Singapore, mostly on a trial basis.
Though hardboard and soft insulation board are produced in very few countries in the Asia Pacific region, and many of their traditional uses are being taken by thin MDF and other panels, the products continue to survive in certain traditional markets such as China, Japan and India. Total consumption in the Asia Pacific increased from 2.2 million m³ in 1990 to 2.7 million m³ in 1995, a growth rate of about 4% per year.
China has both the largest production capacity and the largest demand for these products in the region, and its consumption increased from 1,041,000 m³ in 1990 to 1,307,000 m³ in 1995, a growth rate of nearly 5% per year, and a total representing almost 50% of the regional consumption levels.
Japan is the second largest market and the second largest producer, particularly of the soft insulation board variety. The production levels of hardboard dropped slightly over the period, but production of softboard increased, and the combined Japanese consumption of these products increased from 633,000 m³ in 1990 to 741,000 m³ in 1995, which is a growth rate of 3% per year, roughly in line with the economic growth rate.
Republic of Korea produced 160,000 m³ in 1992, but production (and consumption) have dropped back to 24,000 m³ in 1995. Taiwan Province of China and China, Hong Kong SAR import small quantities, though the volumes appear to be declining. Indonesia produces and consumes small quantities, and Malaysia imports a little. Both Thailand and the Philippines produce and consume small quantities, and Thailand is also a net exporter of hardboard.
Australia and New Zealand produce and consume nearly 200,000 m³ of hardboard and softboard between them, but the volumes are not increasing and are not seriously imported or exported. India and Pakistan produce and consume small quantities.
LVL is a sub-classification of plywood, in which peeled veneers are laid up with the grain always parallel to the length, bonded with phenolic resin, into discreet panel sizes or into long structural beams up to 25 or 30 metres in length.
The total production of LVL in the Asia Pacific region in 1995 was 588,000 m³, with over 70% of the capacity being in Indonesia, mainly destined for export. Japan was the major consumer of LVL in the region in 1995, with a total consumption of 238,000 m³.
Cement Bonded Particleboard (CBPB) is a panel manufactured from cement and wood chips or flakes, and the pressing or setting process produces a useful building material for housing applications which is strong, easily worked and is both fire and moisture resistant.
Japan is the main producer and consumer of CBPB in the Asia Pacific region, with a capacity around 500,000 m³ per year. China, Malaysia, Thailand and Philippines all have a small production capacity of CBPB, some of which is exported to Japan.
Gypsum Fibreboard (GFB) is a panel made from gypsum and reconstituted fibre or paper waste. The product is a low cost, fireproof building panel. There are currently three small GFB mills in China and one in Thailand.
Triboard is a composite structural panel produced at a mill in New Zealand, predominately for the Japanese market. It consists of a thick, high density fibreboard core with two facing veneers.
