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MDF and particleboard outlook

Feb. 13, 2014 - Following four years of mostly flat production (2009–2012), in 2013 North American non-structural panels began what is expected to be a long and steady recovery. The following article is summarized from WOOD MARKETS 2014–2018, our outlook report for MDF and particleboard, and contains an update detailing recent developments.

Demand trends

Since the majority of MDF and particleboard is purchased by manufacturers of products used in home and office interiors (e.g., furniture, cabinetry, flooring), the steady recovery in U.S. housing and R&R (repair and remodelling) markets has led to greater panel demand.

On average, North American consumption of both MDF and particle- board increased in 2013: and
• Total U.S. and Canadian MDF consumption is estimated to have risen by 5% in 2013 — from 2.5 billion sf (3/4" basis) in 2012 to 2.6 billion sf in 2013; and
• Total U.S. and Canadian particleboard consumption is estimated to have risen by 7% in 2013 — from 3.0 billion sf in 2012 to 3.3 billion sf in 2013.

While U.S. housing construction increased in 2013, Canadian housing slowed. This resulted in approximately a 6% decrease in Canadian particleboard consumption, offset by a 4% increase in MDF consumption, for an overall non-structural panel decrease in Canada of 2% from 2012 to 2013.

Outlook

The forecast for non-structural panel producers contains a mixture of sun and cloud for 2014 and 2015. Consumption is forecast to expand slowly as the housing and renovation markets strengthen. With operating rates generally well below 80%, there is substantial room for production increases before the potential for supply shortages begins to put substantial pressure on prices. WOOD MARKETS' forecast calls for a continued slow rise in prices of 3%–4% per year; rising fibre and resin costs are expected to keep a lid on margin increases. Capacity reopenings (if any) will likely be limited to niche products, such as thin MDF.

For more details on Wood Market's outlook for 2014-2015, go to www.woodmarkets.com.


February 13, 2014
By Wood Markets

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