Cross Laminated Timber Market Size, Assessment, Volume, Value, Share, Growth, Trends, Competition, Industry Analysis, Actionable Insights Report; By Layer Type, By Product Type, By Application, By End-Use Industry, By Region and By Country; Outlook and Forecast, 2023 – 2030

Report Summary

The Global Cross Laminated Timber (CLT) Market is projected to grow at a CAGR of around 12% over the forecast period (2023 – 2030). In terms of revenue, the worldwide cross laminated timber market size was valued at USD 1.3 Billion in 2022 and is projected to reach around USD 3 Billion in 2030. Numerous driving factors and rationales are expected to propel the CLT market at significant growth rates.

The cross laminated timber industry is experiencing significant growth driven by its advantages and benefits, including superior design flexibility, fire resistance, exceptional thermal performance, cost-effectiveness, clean and noiseless construction procedures, reduced construction time, and efficient installation processes.

Several key drivers are propelling the expansion of cross laminated timber market, such as the development of standard product codes, the availability of ample floor space, and favorable government policies. Proactive initiatives by governing bodies to promote eco-friendly alternatives in the construction industry, due to growing environmental concerns, have contributed to the continuous growth of the CLT market. Its reputation as an environmentally friendly and greener substitute for conventional building materials further adds to its appeal.

What is Cross Laminated Timber?

Cross laminated timber, or CLT, is a remarkable type of engineered wood lumber. It's fabricated by assembling multiple layers of solid-sawn or structural composite timber beforehand. The layers are arranged in a cross-oriented manner and bonded with adhesive or mechanical fastenings to create a robust wood element. This versatile material finds extensive use in constructing prefabricated building structures.

Manufactured by stacking and gluing multiple layers of solid wood perpendicular to the lower layer, cross-laminated timber boasts exceptional strength in all four directions. Typically composed of softwood such as spruce, pine, and fir, CLT features three to nine layers of selected softwood lamellas that are permanently cross-laminated. This special configuration results in the creation of building components that are lightweight, yet robust and dimensionally stable, showcasing exceptional structural and physical attributes.

As an eco-friendly construction material, CLT is sourced from sustainably harvested forests, aiding in reducing carbon emissions during the construction process and promoting the use of renewable resources. Providing strength on par with steel or concrete, CLT demonstrates exceptional load-bearing capacity and dimensional stability. Moreover, its fire resistance and superior thermal insulation, surpassing that of steel and concrete, make it a fitting choice for both residential and commercial buildings.

What are the Cross Laminated Timber Market Segmentations and Bifurcations?

Cross Laminated Timber Market Segmentation based on Layer Type

• 3-Ply CLT
• 5-Ply CLT
• 7-Ply CLT
• Others

The cross laminated timber market is segmented by layer type, including 3-Ply, 5-Ply, 7-Ply, and others. In 2022, the 5-Ply CLT segment held leading market share in terms of revenue. A 5-ply CLT panel comprises five layers of lumber, imparting it with enhanced structural stability and superior load-bearing capacity compared to the 3-ply CLT alternative. Its popularity stems from its frequent use in larger and more intricate construction projects.

Moreover, the 5-Ply CLT stands out as one of the most cost-effective options, striking a perfect balance between cost and strength. Its multiple layers contribute to a lighter weight, making it easier to handle during construction activities. Additionally, it excels in supporting larger spans and heavier loads, a notable advantage over the 3-ply CLT. Furthermore, the 5-Ply CLT demonstrates improved resistance to horizontal forces, including wind loads, making it particularly suitable for structures located in regions with higher wind loads or seismic activity. Architects and engineers favor this variant for its versatility and reliable performance in demanding construction scenarios.

Cross Laminated Timber Market Segmentation based on Product Type

• Adhesive Bonded CLT
• Mechanically Fastened CLT

In terms of product type, the adhesive-bonded CLT segment held the leading revenue share of around 80% in 2022. The utilization of high-strength adhesives for plank bonding is anticipated to drive demand across diverse industries, including residential, institutional, and commercial sectors.

Adhesive bonding holds significant importance in cross laminated timber production, as it establishes a robust connection between wood layers, crucial for ensuring structural stability. This robust bond leads to the creation of solid and stable CLT panels, renowned for their consistent quality, durability, and exceptional load-bearing capacity. As a widely employed material in construction, adhesive-bonded CLT finds applications in residential, commercial, and industrial buildings.

Production expenses for adhesive-bonded CLT are lower due to decreased machinery usage compared to mechanically fastened CLT. Moreover, adhesive-bonded CLT panels can be transformed into biofuel pellets, enhancing sustainability. Custom manufacturing of panels to precise construction requirements minimizes wood wastage.

Conversely, mechanically fastened CLT entails the assembly of three or more lumber layers using nails and screws, without adhesive or press machinery. Despite being in its early stages, the market for mechanically fastened CLT witnesses restrained adoption within developed regions such as Europe and North America. Producing mechanically fastened CLT proves highly complex compared to adhesive bonded CLT, requiring skilled labor to operate fastening machines. The risk of raw material wastage is also higher, as improper screw application can affect the entire assembly.

Cross Laminated Timber Market based on Application

• Structural
• Non- Structural

In terms of application, structural segment held the leading share of cross laminated timber market in 2022. CLT finds primary application in structural elements such as walls, floors, and roofs, showcasing its versatility. This timber innovation is widely recognized as a foundational material in diverse construction projects and buildings. Its robustness, longevity, and environmental compatibility position it favorably for load-bearing roles. Notably, engineering projects rely on structural grade cross-laminated timbers, with commercial structures leading this preference. Global trends in construction and restoration have amplified the utilization of hardwood floor beams. Additionally, the surging demand for ecologically sound housing is a significant market driver.

The merits of structural cross-laminated timber encompass dynamic design potential, superior heat attributes, fire resilience, exceptional acoustics, and seismic reliability. In an evolving housing market, evaluating a building's utility and objectives hinges on adaptable design. CLT stands out by facilitating extended spans and diminished interior support components through amplified panel thickness, distinguishing itself from steel and concrete counterparts.

A noteworthy and growing non-structural application lies in CLT bolted mats. CLT bolted mats, also known as CLT mats, provide eco-friendly access solutions in environmentally sensitive areas and challenging job sites with uneven terrain. They serve as temporary roadways, facilitating the movement of heavy machinery while preventing cross-contamination. In extreme weather and unstable landscapes, CLT mats offer a stable platform for workers and equipment. Their easy installation and removal make them a cost-effective and efficient solution for accessing challenging project locations.

Cross Laminated Timber Market Segmentation based on End-Use Industry

• Residential
• Institutional & Public Buildings
• Commercial Facilities
• Others

In 2022, the residential segment led the CLT market, commanding around 50% of the global revenue share. This sector has consistently stood as the primary market for CLT and is projected to sustain growth throughout the forecast period. CLT boasts impressive structural strength and recyclability, which are expected to further drive market expansion within residential construction.

CLT has garnered popularity in residential construction due to its robustness and durability, making it an ideal choice for constructing energy-efficient homes. The escalating adoption of eco-friendly construction materials and increased emphasis on seismic resilience are projected to fuel CLT consumption in earthquake-prone regions, including Japan, Mexico, and India, among others.

Numerous governments in regions such as North America, Europe, and Asia Pacific have made substantial investments in environment-friendly construction materials, aiming to mitigate the construction industry's carbon footprint. This strategic initiative is anticipated to serve as a catalyst for driving market growth throughout the forecast period.

Moreover, the prominence of CLT is steadily increasing in institutional and public buildings, becoming the preferred choice for schools, colleges, government edifices, community centers, and libraries, among others. Its versatile application encompasses walls, floors, and ceilings in classrooms, libraries, laboratories, and amphitheaters, benefiting from its exceptional acoustic properties and aesthetic appeal, thus significantly contributing to market growth.

An upward trend is expected in the adoption of CLT across diverse commercial facilities, spanning offices, malls, hospitals, restaurants, cafes, and retail centers. This surge can be attributed to the manifold advantages of CLT, which encompass rapid installation, design adaptability, and fire resistance. The utilization of prefabricated CLT further streamlines construction timelines, while its inherent strength and adaptability lend themselves to the creation of distinctive architectural designs.

What are the Major Growth Drivers, Restraints, and Opportunities in the Cross Laminated Timber Market?

Construction Industry Growth Fuels CLT Market Expansion

The global construction industry is poised for exponential growth, projected to reach a staggering US$15 trillion by 2030. This surge is primarily attributed to escalating urbanization, rising disposable incomes, and increased government investment in infrastructure. Consequently, the burgeoning construction industry is propelling the growth of the Cross Laminated Timber (CLT) market. Governments and construction firms alike are actively seeking sustainable building materials to align with both infrastructure development goals and WHO standards for CO2 emissions reduction and stringent environmental standards.

CLT stands out as a remarkably versatile building material, applicable across a diverse range of construction projects, positioning it favorably to leverage the construction industry's expansion. Its user-friendly characteristics, including ease of cutting, drilling, and nailing akin to conventional wood products, make it a preferred choice for builders seeking efficient construction solutions.

Anticipated growth in the global urban population, projected to reach 6.74 billion by 2050, will inevitably exert pressure on housing demand. Cross laminated timber emerges as an eco-friendly, cost-efficient building solution to meet this need. Moreover, its strength, durability, and fire-resistant attributes have led to its increasing adoption in commercial construction, further cementing CLT's role as a versatile and dependable choice across various applications in construction industry.

Escalating Demand for Eco-friendly and Sustainable Construction Materials

CLT, termed as a renewable and green resource derived from wood, serves as a remarkable sustainable building material. The heightened ecological awareness has compelled a surge in CLT demand within the construction sector as stakeholders seek avenues to curtail their environmental impact. The inclination toward sustainable construction materials continues to intensify as individuals increasingly recognize the ecological repercussions associated with conventional building resources. CLT's unique composition sourced from renewable wood has rendered it a prudent choice for builders committed to sustainable practices. This burgeoning emphasis on sustainability across the construction domain has significantly propelled the demand for cross laminated timber.

Furthermore, the surge in popularity of green building initiatives is significantly boosting the demand for CLT. As builders strive to meet stringent green building requirements, CLT emerges as an ideal solution. Its attributes align seamlessly with green building standards, solidifying its position as a viable choice for sustainable construction projects. In developed nations, CLT-based structures are steadily integrating into the architectural landscape. These buildings are increasingly recognized as both eco-friendly and economically efficient alternatives for construction. Notably, mass timber, which includes CLT, is emerging as a predominant sustainable building material in US construction projects. The intrinsic qualities of mass timber, characterized by robustness, durability, and environmental friendliness, have propelled its prominence in the realm of US construction projects.

Government Support and Initiatives Foster Cross Laminated Timber Industry Growth

Numerous governments and authorities around the globe are actively endorsing the use of cross-laminated timber in the construction sector. Government initiatives have played a pivotal role in propelling the growth of the CLT market. These initiatives encompass a spectrum of actions, including promoting eco-friendly construction practices, providing substantial funding for research and development, offering incentives and subsidies, rigorously revising building codes, facilitating technical expertise, advocating for wooden construction, procuring CLT for public ventures, spreading awareness, and fostering collaborations with key industry stakeholders. These collective efforts are strategically aimed at achieving crucial objectives, such as reducing carbon footprints, advancing CLT technology and its quality, mitigating construction expenses, seamlessly integrating CLT into prevailing building codes, and comprehensively educating stakeholders about the multifaceted advantages of CLT.

However, the CLT market faces challenges despite a positive outlook with a considerable CAGR during the forecast period. Inflation triggered by the war in Ukraine has resulted in surging raw material prices and rising energy costs, severely impacting the construction industry and subsequently limiting the growth of the cross-laminated timber market. Additionally, the cross laminated timber market experienced a sudden decline in demand due to the global impact of COVID-19, with governments worldwide suspending construction activities. However, the market has displayed resilience, capitalizing on its strengths and adjusting to the rising demand for sustainable construction solutions.

What are the Regional and Country Trends in the Cross Laminated Timber Market?

Cross Laminated Timber Market: Regional Segmentation Analysis

• North America
• Europe
• Asia Pacific
• Middle East and Africa
• South America

In 2022, Europe emerged as the dominant CLT market, securing more than 50% share of the global revenue, attributed to the robust green building movement spearheaded within the region. Europe stands as the world's foremost producer of cross-laminated timber (CLT). The European market finds impetus primarily in the rapid advancement of residential construction. The escalating awareness surrounding the utilization of wooden products, owing to their lightweight nature and remodeling convenience, is projected to drive heightened demand for CLT. This surge is poised to attract increased investments from manufacturers. Moreover, the ongoing trend of integrating wooden products in construction applications is anticipated to provide further momentum for market growth throughout the forecast period.

North America cross laminated timber (CLT) market is primarily propelled by substantial demand within the U.S. The Canadian and Mexican application sectors also exhibit robust growth, contributing to promising prospects for regional CLT product demand. North America is observing a noteworthy trend in the adoption of CLT for hybrid building construction, ingeniously combining timber and traditional materials to fashion architecturally captivating office spaces. However, the region has witnessed the introduction of several regulations concerning wood products, which could potentially impede market expansion.

Asia Pacific CLT market growth is expected to be bolstered by the implementation of green building codes by various governments. However, the region's prevailing high temperatures and extreme climatic conditions have traditionally led consumers to favor concrete construction over wooden alternatives, posing a potential constraint on the CLT market expansion. Nevertheless, countries such as Japan, South Korea, Australia, New Zealand, and China are projected to drive the CLT market in the Asia Pacific. Notably, China is researching and planning to integrate locally grown bamboo into the manufacturing of CLT, presenting a promising avenue for further market development.

The sustained economic growth in the APAC region is driving significant expansions in the commercial, residential, and industrial sectors. This expansion, in turn, is expected to elevate construction activities, consequently spurring the demand for cross laminated timber products. Additionally, the flourishing tourism industry has generated a heightened need for establishments such as restaurants, resorts, and food chains, further propelling the growth of the CLT market.

How is the Competition Scenario in the Cross Laminated Timber Market?

Cross Laminated Timber Market: Competitive Landscape

The global cross-laminated timber (CLT) industry exhibits relatively moderate competitiveness, with a limited number of manufacturers primarily consolidated in the European region. These limited manufacturers, catering to major global economies, engage in competition centered around product excellence, encompassing attributes such as wood thermal resistance, surface finish, and pricing, all geared towards broadening their applications.

Prominent players in the industry are channeling significant resources to advance research and development efforts focused on refining CLT grades and exploring new applications. Notably, some of these players possess forest land, utilizing it as a source of timber for their processed offerings. Additionally, a strategic emphasis on capacity expansion has been embraced by market leaders to enhance efficiency and expedite customer service.

Some of the key players operating in the global cross laminated timber (CLT) market include Stora Enso, Mayr-Melnhof Holz, Binderholz GmbH, Eugen Decker Holzindustrie KG, Hasslacher Holding GmbH, Schilliger Holz AG, KLH Massivholz GmbH, Structurlam Mass Timber Corporation, B&K Structures, SmartLam, Meiken Lamwood, Pfeifer Group, and XLam, among others. A pivotal focus is directed towards contractual agreements and pioneering product development, strategically tailored to cater to evolving demands from commercial and residential stakeholders across the globe.

Cross Laminated Timber Industry Developments

• In October 2022, Stora Enso started its new production facility. It is located in Ždírec, Czech Republic. This state-of-the-art site boasts an annual production capacity of cross laminated timber (CLT) at around 120,000 cubic meters.

• In May 2022, Stora Enso made a strategic investment in ACDF Industrie SAS, solidifying its position as a 35% shareholder in the esteemed French wood processing company. This strategic move aligns seamlessly with Stora Enso's growth strategy for mass timber building elements. It empowers the company to offer tailored, value-added cross-laminated timber (CLT) solutions to its esteemed long-term partners in France.

• In December 2021, Mayr-Melnhof Holz entered into a significant agreement, acquiring Bergkvist Siljan, the Sweden based sawmill group. This strategic move stands as a testament to the Austrian wood processing group's commitment to its steady expansion and growth trajectory.