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Report from
Europe
European wood flooring consumption fell in 2024
According to an initial estimate by the European Parquet
Federation (FEP), consumption of wood flooring shrank a
further 5% last year following what it described as a
‘dramatic fall’ in 2023.
After a challenging two years, however, the consensus in
the sector is that the bottom of the market was reached in
2024, and that wood floor consumption is set to benefit
from the predicted upturn in construction output in Europe
later in 2025.
In an earlier market assessment, FEP reported that wood
flooring consumption in the first three quarters of 2024
was down on the same period of 2023 in all but three of its
member countries. It also said that European producers
faced the challenge of consumers opting for wood-look
laminate flooring and rising imports of cheap multi-layer
parquet products from China.
The latter were given a boost in this period, says FEP, by
importers building stocks to pre-empt the imposition of an
anti-dumping duty.
Consumption of wood flooring in Austria in the first nine
months of the year was down 5%, and manufacturers
expect the market to be tough in 2025 due to low
construction levels and high energy costs.
French consumption was down between 13-15%, with
construction levels still low. Manufacturers also faced
high oak prices due to competition from the barrel stave
sector.
In Germany wood flooring sales in the period were down
5-10%, again with a slow-moving construction sector cited
as a reason. Producers hoped the bottom of the market was
reached in the third quarter but a significant market
improvement was not expected until late 2025 or even
2026.
In Italy, consumption was down 5-10%. Reasons given
were lower consumer purchasing power, and also the
growing share of market taken by wood lookalike artificial
flooring. The hospitality renovation market for wood
flooring was said to be improving, but the retail sector was
not performing well.
The FEP reported that the Dutch market was also reported
down 5-10%.
In Spain, the market was stable, but difficult due to low
construction levels, and the impact of high energy costs
and inflation on consumer spending power.
FEP’s 2024 report grouped Norway, Sweden, Denmark
and Finland together. It said wood flooring faired best in
Norway and Denmark in the period. But in Sweden
business was more difficult, with consumers tending to
spend more on leisure activities and holidays than home
improvement.
Laminate flooring was also reported to be increasingly
popular. More hopefully, it was anticipated that
construction output would grow by 5% in 2025. The
Finnish market was reported to be ‘most pessimistic’, with
the renovation sector, including installation of wood
flooring, improving, but from a low base, and construction
still slow. Sales are expected to be flat in 2025.
In Switzerland, producers expect to be impacted by rising
minimum wages, but they report stable consumption in the
first three quarters of 2024.
See: https://www.parquet.net/p/press.html?m=1 .
UK construction set for recovery
After contracting in 2024, UK construction output is
predicted to recover at an accelerating rate through 2025
into 2026. This is according to the Winter 2024/25
forecasts from the country’s Construction Products
Association (CPA), regarded as one of the leading market
commentators and trend analysts in the sector.
The Winter Forecast, published at the end of January
predicts that total construction output will increase 2.1% in
2025, with growth rising to 4% in 2026. This follows two
years of the industry following a downward curve.
In 2022 it saw a post-pandemic boom as the sector got
back to projects delayed during the health crisis. Growth
hit 6.8%. In 2023 the market turned down significantly,
with construction activity slowing as the year progressed,
resulting in growth dropping to just 2.2%. In 2024
construction output contracted 2.9%.
The CPA says that its forecast of 2.1% construction output
growth for 2025 is a downward revision from its previous
forecast in the Autumn, when it predicted 2.5%. This is
due to expectations that UK economic growth will be
slower than anticipated and also the fact that inflation is
higher and the Bank of England has made fewer interest
rate cuts than projected in the Autumn. However, the CPA
forecast of 4% growth in 2026 is an upward revision from
the 3.8% predicted earlier.
The CPA also noted that the UK Government’s Autumn
Budget setting out tax and spending plans for the year
ahead contained some ‘positive intent’ regarding
construction. This included pledges to ease planning
consent rules for new building.
The CPA forecast also cautions that there are downside
risks for UK construction going into 2025. These include
the possibility that the country will enter a period of
stagflation (high inflation, low growth) with mounting
concerns in financial markets about UK Government
borrowing and prospects for the economy.
There is also uncertainty about the market impact,
particularly in projects designated higher risk, such as
high-rise residential buildings, of the Building Safety Act
and the activities of the new Building Safety Regulator,
both of which were introduced to drive up safety
performance following the Grenfell tower fire disaster in
London in 2017.
The target set by the government is for the UK to build 1.5
million new houses overall in the next five years. The
CPA predicts that this will not be achieved and that the
total in this time will more likely be 1.1-1.2 million.
However, it says that the new National Planning Policy
Framework set out by the government, in speeding up and
streamlining the planning permission process, will benefit
the sector, especially smaller housebuilders.
Pressures on builders will include tighter environmental
regulation and the Future Homes and Buildings Standards,
which will require improved energy and carbon
performance.
Higher national minimum wage and national insurance
levels will also drive up builders’ labour costs. But the
CPA still predicts that private house building will grow
6% this year and 8% in 2026.
Private housing, repair and maintenance and improvement
(RMI) is the second largest UK construction sector. It hit
its highest ever level of activity and output in late 2021
through early 2022 as householders working from home
during the health crisis invested to expand and improve
their properties.
The sector in 2023 was worth £34.9 billion. Late 2023
into 2024, however, it was also hit by rising inflation and
high interest rates and the consequent fall in consumer
confidence. It first stagnated and then in 2024 contracted
by 4%.
The CPA says that market development will depend on
consumers’ willingness to spend after the ‘scarring effects
of energy and food price spikes in 2022/23’. But the signs
are more positive due to various factors, including
sustained real wage growth, falls in interest rates, even
though slight so far, plus positive house price inflation.
These, says the CPA, should lead to greater willingness
among owners to invest savings in their homes. Spending
on energy efficiency improvements specifically, is
expected by some in the timber trade to include more
purchases of new higher performance doors and windows.
Wood panel products, including highly insulating
structural insulated panels are also expected to benefit by
the UK timber sector, over 70% of whose total sales are to
construction.
The CPA forecasts that private sector RMI output will
grow 3% in 2025 and 4% in 2026 Prospects for the
commercial construction sector vary according to project
type. The CPA says builders working on smaller
refurbishments and commercial office and retail premises
fit outs remain busy as owners repurpose existing spaces.
Conversion of commercial buildings to residential, notably
for student accommodation also continues at a good rate.
The CPA concludes that, despite the level of activity in
refurbishment of existing buildings, overall commercial
construction output will remain flat through 2025, but
grow 2.7% in 2026 as lower interest rates, financing costs
and generally improved economic prospects result in
delayed commercial tower projects coming on stream.
Public new build housing has been increasingly impacted
by housing association and local authorities diverting
funding to refurbishment and improvement of existing
housing stock. This has been driven by safety regulation,
rules to improve building carbon and wider energy
performance and new legislation to raise the overall
quality standards in public housing.
The public non-housing construction sector, which
includes education and healthcare facility building and
improvement and which saw output increase 2.2% in
2024, is predicted to grow 1.8% in 2025 and 5% in 2026.
Overall, UK infrastructure construction output, including
energy, road, rail and water industry projects, is predicted
to rise 1.4% in 2025 and 4.1% in 2026.
On a cautionary note, the CPA says that the capacity of
UK construction as a whole to meet government building
targets continues to be hindered by skills shortages and
insufficient recruitment. The issue is set to be exacerbated
by a demographic issue; the fact that, due to the age range
of the existing workforce, 500,000 building workers, 25%
of the total, will be lost to retirement in the next 10-15
years.
See: www.constructionproducts.org.uk/
Selva Maya mission highlights timber trade potential
A European timber trade mission to the Selva Maya forest
in Guatemala and Mexico in November resulted in initial
export contracts with local timber suppliers. The objective
was to highlight the range of certified timber available
from the region and to explore their market opportunities
in Europe. Ten business delegates took part in the trip.
The turnout was moderate said Probos Director and Senior
Adviser, Mark van Benthem in an article in the Dutch
Houtwereld magazine. “But the international trade showed
interest and requested further information on wood species
and volumes available.”
FSC-certification is well-established in the Selva Maya,
with some community operations certified for over 30
years. However, the bulk of timber production is focused
on swietenia mahogany and cedrela which together with
three other species make up 90% of harvest.
Harvests per hectare are low with some communities
harvesting less than one tree per hectare due to a lack of
demand for lesser-known species. Businesses on the
mission were reported as disappointed in the volumes
available in more bulk products such as decking.
See: https://www.probos.nl/en/
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