Medium Density Fiberboard Market - Forecast(2023 - 2028)

Medium Density Fiberboard Market Overview

Medium density fiberboard market size is forecast to reach US$56.3 billion by 2027 after growing at a CAGR of 5.8% during the forecast period 2022-2027. Medium density fiberboard (MDF) is an engineered wood product. MDF is made of wood-mill byproducts, primarily sawdust and wood chips and shavings, which are ground into a fine powder, dried to remove moisture, and then mixed with resins and wax before being pressed into flat, hard panels. All fiberboards are bonded using formaldehyde resins, typically urea formaldehyde resins or phenol formaldehyde resins. In order to make the product more sustainable new raw materials are being introduced such as straw and bamboo which are becoming popular as they are a fast-growing renewable resource. Many of MDF's qualities make it an ideal replacement for plywood or particle board. The product is dense, flat, stiff, and is easily machined. The increasing sales of furniture act as a driver for the growth of the medium density fiberboard market.

COVID-19 Impact

The COVID-19 pandemic has impacted the global market extensively. In the initial phase of the pandemic, as people were confined to their houses due to lockdowns and stay-at-home mandates, they focused more on do-it-yourself (DIY) projects. As a result, the demand for flooring, furniture, and various decorative panels helped the market recover. According to a study by Harvard University researchers, in the US spending on home improvements and repairs grew more than 3%, to nearly $420 billion, as households modified living spaces for work, school, and leisure in response to the COVID-19 pandemic. It was reported that almost 60% of the homeowners had started DIY or home improvement projects. CouponFollow, a homeowner savings resource, conducted a survey of more than 1,000 Americans about the DIY projects they took up during the pandemic. According to the survey, the five most common and successful projects during the pandemic were building/installing shelving and cabinetry, house painting, building/enhancing the garden, bathroom decoration and bedroom decoration. Also, during the lockdown, many people purchased new homes, which in itself calls for home improvement projects. This contributed to the sales of medium density fiberboards.

Medium Density Fiberboard Market Report Coverage

The report: “Medium Density Fiberboard Market – Forecast (2022-2027)”, by IndustryARC, covers an in-depth analysis of the following segments of the medium density fiberboard industry.

By Product: Ultra-Light Medium Density Fiberboard, Moisture Resistant Board, Fire Retardant Medium Density Fiberboard, and Others
By Resin Binder: Urea Formaldehyde, Phenol Formaldehyde, and Others.
By Grade: Low Density Grade, Standard Density Grade, and High-Density Grade.
By Application: Cabinets & Shelves, Flooring, Furniture, Millwork, and Others.
By End-Use Industry: Building & Construction (Doors & Windows, Flooring, Paneling, Interior Cabinetry, and Others), Furniture (Office Furniture & Residential Furniture), Packaging, and Others.
By Geography: North America (USA, Canada, and Mexico), Europe (UK, Germany, France, Italy, Netherlands, Spain, Russia, Belgium, and Rest of Europe), Asia-Pacific (China, Japan, India, South Korea, Australia and New Zealand, Indonesia, Taiwan, Malaysia, and Rest of APAC), South America (Brazil, Argentina, Colombia, Chile, and Rest of South America), Rest of the World (Middle East, and Africa).

Key Takeaways

• Asia-Pacific dominates the medium density fiberboard market, on account of the growing construction activities in the region. According to Invest India, the construction industry in India is expected to reach $1.4 trillion by 2025.
• Medium density fiberboard is a nonstructural fiber-based panel that is composed of wood fibers obtained from waste products such as sawdust and wood chips and bonded together with resin.
• Medium density fiberboard is used extensively to made furniture such as cabinets and is used as a substitute for plywood and particle boards.
• The major opportunity for this market is the development of specialty MDF products that utilize bio-based resins instead of synthetic resins.
  
  

Figure: Asia-Pacific Medium Density Fiberboard Market Revenue, 2021-2027 (US$ Billion)

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Medium Density Fiberboard Market Segment Analysis – By Grade

The standard density grade segment held the largest share in the medium density fiberboard market in 2021 and is expected to grow at a CAGR of 5.1% during the forecast period. Standard density MDF has a smooth and stable surface that provides an excellent substrate for painting and thus gives it a wood-like appearance. Due to this, MDF can be used as a wood substitute. The standard density MDF characteristics include homogenous fine texture, high bonding strength, inherent stability, and easy machinability. So, it can be used in a wide array of designs in residential and commercial interiors. It is used to make cupboards, wardrobes, wall panels, tabletops, toys decorative pieces, handicrafts, etc. But standard MDFs are susceptible to damage when exposed to moisture and high humidity. So, they are not recommended for exterior usage. To overcome this, moisture resistance variants are available.

Medium Density Fiberboard Market Segment Analysis – By Application

The furniture segment held the largest share in the medium density fiberboard market up to 36% in 2021. MDF has the following advantages it has a smooth surface and can be painted easily, the smooth edges make it easy to cut, it is denser and stronger compared to particle board, and it is cheaper than plywood. Therefore, in furniture making it is used as a substitute for plywood and particle board. MDF is ideal for cutting, machining and drilling as it does not chip easily. Since MDF furniture is made with wastes such as sawdust and wood chips, it is eco-friendly as well as more economical in comparison to furniture made from solid wood or plywood. The sales of furniture have been going up ever since the pandemic. The interest in home-related projects with people spending more time at home drove up the sales for furniture. For instance, D2C home furnishing brand, Article, shared that April 2020 was their highest revenue month to date, with sales up 200% compared to April 2019. Conversion of spaces into home offices and home classrooms also has driven the sales of furniture. This trend also continued in 2021. According to the US Department of Commerce, sales from furniture and home furnishings stores came in at $146.1 billion during 2021, which is a 26.4% increase over 2020. The increasing furniture sales contribute to driving the sales of MDF. Therefore, the furniture segment is set to dominate the medium density fiberboard market during the forecast period.

Medium Density Fiberboard Market Segment Analysis – By Geography

The Asia-Pacific region held the largest share in the medium density fiberboard market in 2021 up to 41% owing to the construction activities in the region. Increased spending on residential construction to meet the housing demand is driving the MDF market. According to the Indian Brand Equity Fund (IBEF), between July-September 2021, a total of 55,907 new housing units were sold in eight micro-markets in India (59% YoY growth). In Q3 2021 new housing supply stood at approximately 65,211 units, increased by 228% YoY across the top eight cities compared with approximately 19,865 units launched in Q3 2020. The government of India has taken several initiatives such as Smart City Project, Housing for All, etc. to encourage development in the sector. In Australia, the national treasury announced the HomeBuilder programme in June 2020, which provides eligible owners (as well as first home buyers) with a grant of AUD 25,000 to substantially renovate an existing home or build a new one. The Home Ownership Campaign was introduced by the Malaysian government with the aim to encourage homeownership in the country. Fire-retardant MDF is widely used in the construction of commercial buildings such as offices and shops which are required to meet certain safety standards and also in the construction of homes for protection against fire. Therefore, the government initiatives in the region drive the construction industry which in turn drives the medium density fiberboard market.

Medium Density Fiberboard Market Drivers

Increasing Sales of Sustainable Furniture

With concerns raised about sustainability and the carbon footprint of furniture, new methods and innovative possibilities in the use of wood products have developed rapidly. MDF is used to make different kinds of inexpensive furniture such as bookshelves, entertainment centers, tabletops, etc. It is also used in making pre-fabricated furniture. MDF lowers the cost of furniture manufacturing because it is economical and produced easily. MDF is used heavily in flat-pack furniture owing to its cost and customizability. Furniture giant, IKEA makes extensive use of MDF, especially in its cabinets. According to a study by PricewaterhouseCoopers, sustainability is a crucial factor for three-quarters of consumers when they are buying furniture. MDF wood fiber can be obtained from a host of materials including various woods, forest thinning, straw, bamboo, recycled paper, carbon fibers, scrap and waste from saw-mills, and so on. MDF is made primarily from wood fiber, sawdust, wood shavings, and other portions of the wood that might normally be discarded, these wastes are instead recycled into MDF This both reduces waste and also means less deforestation, thus creating sustainable practices. New raw materials are being introduced in MDF such as straw and bamboo which are becoming popular as they are a fast-growing renewable resource and are contributing to making the product more sustainable. According to Furniture Today, spending on furniture and bedding will grow at a rate of 20.8% over the next five years to reach $145 billion by 2026. As people become more and more aware of the kind of furniture they purchase, this will increase the sales of sustainable furniture and thereby drive the medium density fiberboard market.

Growth of Residential Construction

In India, strong government support at the national level for the housing sector is reflected in the allocation of sizeable funding for housing in the national 2021 Budget including Rs 50,000 crore allocated to the Ministry of Housing and Urban Development (MoHUA) as well as the creation of US$ 3.5 billion fund to support completion of stalled housing projects. The Pradhan Mantri Awas Yojana (PMAY) program, which aims to provide affordable housing to all urban poor by 2022 through initiatives like financial support, is expected to continue to be a driver of the robust recovery of India's residential construction growth. According to BloombergQuint, new US home construction unexpectedly strengthened in December 2021 led by apartment projects. According to data from the Commerce Department, Housing & Urban Development, residential starts rose 1.4% to a 1.70 million annualized rate from a 1.68 million pace in November. For all of 2021, 1.6 million homes were started, a 15.6% surge from 2020 and the most since 2006. As the value of residential construction improves, more houses will be built which will create a demand for MDF. The value of residential construction is expected to substantially increase in 2022 due to low mortgage rates and low interest on home loans representing an opportunity for the industry. Thus, the growth in the residential construction industry drives the medium density fiberboard market. 

Medium Density Fiberboard Market Challenges

Toxicity of Formaldehyde

A major drawback of MDF is that urea formaldehyde resins are used to bind the small particles of wood. As a result, the boards release harmful volatile organic compounds (VOCs) into the surroundings for a period of time. Therefore, it is highly recommended to take utmost care while cutting, sanding, and working with MDF to avoid inhalation of small wood particles and VOCs. VOCs can cause allergies, migraines, and asthma. According to a report by the European Respiratory Review, the possible health effects of indoor VOC exposure are a cause for concern, given that people in general, and children in particular, now spend most of their time indoors. When MDF is cut, sanded, shaped or machined in any way, it releases clouds of dust particles coated with formaldehyde. The particles, much smaller than those emitted by most other commonly used woods, can be inhaled deep into the lungs. EU classifies formaldehyde as a cancer-causing agent and there are stringent regulations regarding wood products containing formaldehyde in the EU. This factor is a challenge for the medium density fiberboard industry. MDF made of wood, phenolic resins, and zinc borate do not contain urea formaldehyde resins. Such kinds of MDFs may help in overcoming this challenge.

Medium Density Fiberboard Industry Outlook

Product launches, acquisitions, and R&D activities are key strategies adopted by players in the market. Medium Density Fiberboard top 10 companies include:

1. ARAUCO
2. Uniboard
3. Unilin Group
4. Swiss Krono Group
5. Dynea AS
6. Fantoni Spa
7. Roseburg Forest Products
8. Duratex
9. Kronoplus Limited
10. Sonae Arauco SA

Recent Developments

In July 2021, Roseburg Forest Products launched Armorite Exterior MDF. Armorite is a no-added formaldehyde MDF panel that resists moisture, rot, decay, and insects.

In August 2019, ARAUCO, a global producer of wood products, announced that it signed an agreement to acquire Prime-Line, Inc., a privately-held manufacturer of medium density fiberboard moulding and millwork products.

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