Market Trends of Asia-Pacific Oriented Strand Board Industry
This section covers the major market trends shaping the APAC Oriented Strand Board Market according to our research experts:
Growing Usage of OSB in Construction Sector
- The mechanical properties of oriented strand boards (OSB) make them useful in load-bearing applications in the construction segment. OSBs are extensively used for roof, wall, and floor sheathing purposes. The construction segment in India and China is expected to grow multifold during the forecast period, owing to the growing population, rapid urbanization, and increasing disposable income with the middle class in both countries.
- India has a total of USD 1.4 trillion in infrastructure investment budget under NIP, out of which 16% is allocated to urban infrastructure. With the support of such strong investments, the Indian construction industry is expected to reach USD 1.4 trillion by 2025.
- On the other hand, China's building construction completion value touched CNY 7.94 trillion (USD 1.12 trillion) in 2021, with residential construction contributing to 63% of the total.
- The Chinese government is encouraging the urbanization of many shanty towns into affordable housing. The government also aims to increase the funding for infrastructure construction activity through local government special bonds. The share of local government funding is expected to rise from 18% in 2021 to 39% in 2022.
- OSBs are now finding higher demand than plywood in building construction, owing to their higher strength and greater shear values. Therefore, parallel to the increasing construction segment, the demand for OSB is expected to rise in the region.
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India Dominating the Asia-Pacific Market
- India's growth into a prominent economy globally has led to a substantial influx of foreign investments. India received the highest annual FDI inflow during FY 2021-2022 amounting to USD 83.57 billion.
- The rising urbanization of rural areas and the general shift of population from rural areas to metro cities are pushing the demand for better housing and infrastructure.
- In a bid to further enhance the infrastructure sector, the government of India, in its Union Budget for 2022-2023, allocated USD 130.57 billion to the sector. An allocation of USD 9.85 billion was made to the Ministry of Housing and Urban Affairs.
- There has been an increasing trend in home buying and home renovations post-pandemic, which has also resulted in additional sales growth for the furniture-making industry.
- The Indian furniture-making market was valued at around USD 4.74 billion in 2022, and it is expected to further grow at a rate of over 9% during the forecast period.
- In the short term, the furniture demand is also expected to benefit from the work-from-home conditions, as a result of the pandemic.
- The aforementioned factors are expected to play a crucial role in boosting the demand and consumption of oriented strand boards in the region.
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