Ernst & Young has released a new report detailing the major megatrends that will affect the forestry products industry into the future.
The opportunities available for Australian industry were researched at the behest of Forest and Wood Products Australia, with EY uncovering five major trends:
- A hungrier world – population growth driving global demand for food and fibre
- A wealthier world – emergence of a new middle class increasing food consumption
- Choosy customers – information empowered consumers demanding particular ethics, provenance, sustainability or health attributes
- Transformative technologies – advances in food and fibre production and transport
- A bumpier ride – changes resulting from globalisation and a changing climate
The forest products industry contributed $7.7 billion to the Australian economy in the 2013/14 financial year, with over 70,500 people employed. The report looked into four key segments of the industry: commercial forestry, paper and packaging, construction materials, and energy and biochemicals.
On construction materials, the report found that there was expected to be an increase demand for wood panels, engineered wood products and plantation-sourced timber for house construction. This would be promoted by growth in middle class households with demands for better quality construction, and a move towards the benefits of prefabrication. Climate change would also make low-carbon options like timber more attractive.
The report provides a number of recommendations to increase the capacity of the industry to respond to trends, including creating a nationally coordinated strategy, regionally-based plans to identify opportunities for new domestic processing, and fostering an innovative culture to leverage transformative technologies and respond to challenges like climate change.