Low-cost, eco-friendly substitutes to solid wood gain traction

Companies seek to keep prices in check amid rising material costs.

Pressured by high wood outlay, China suppliers are turning to cost-effective alternatives such as MDF, HDF, particleboard and plywood to tamp down price increases. In fact, many makers of furniture and building materials have already raised quotes by up to 20 percent.

The most significant upswing is for products made of solid wood. During the first several months of 2011, companies augmented rates for such models by 10 to 20 percent. In 1Q 2011, sawn timber averaged $203.79 per cubic meter, nearly 10 percent higher YoY. Rates dipped slightly in the second quarter but remained high.

Meanwhile, data from the China International Timber Exchange Organization shows that redwood reached $1,172 per cubic meter in May this year and teak, $1,449. Respectively, these figures translate into an almost 9 and 1 percent increase from costs in May 2010. In contrast, MDF was stable at $18.40 for every cubic meter.

Other than high wood costs, efforts to improve overall manufacturing efficiency are spurring the shift from solid wood to engineered varieties.

Li Hong Fan’s company China Wood International recommended using the latter extensively in furniture and building materials. Li is company president.

"In the furniture industry, the material utilization rate for man-made boards is 70 to 85 percent whereas it is 60 to 70 percent for real timber," Li added. "The equivalent is using just 1 cubic meter of MDF or plywood for every 3 or 4 cubic meters of solid wood."

Joint Creative Mfg Ltd adopts MDF for its line of hotel, bar and restaurant furniture, modifying construction to boost material utilization further.

Composite doors from the China Wangli Group consist of a solid-wood core sandwiched by MDF or HDF. Wood veneer is glued on the surface and coated with six layers of paint to emphasize the grain.

There are, however, concerns over the ecological impact of engineered wood. MDF, HDF, particleboard and hardwood plywood are produced using adhesives with urea-formaldehyde resins. The first two, in particular, give off the highest levels of formaldehyde.

Although varieties with lower emission rates are now available, companies are exploring environment-friendly options such as bamboo. Furniture suppliers are also combining soft- and hardwood with certain species of timber, which mature within two or three years, similar to bamboo.

In Anji, 50 percent of the aggregate turnout of bamboo-based products consists of flooring. The latter includes models made wholly of bamboo and composites of the grass and other wood types. Anji is a county in Huzhou, Zhejiang province, known for its 60,000 hectares of bamboo groves.

Countrywide, the bamboo industry yielded nearly $13.8 billion worth of products in 2010, according to the State Forestry Administration. This strengthens China's position as the world's largest hub for bamboo processing and exporting.

To sustain environment-protection measures, China is developing cultivated forests, said Zhang Bing Yuan, general secretary and professor of Jiangsu Province Furniture Trade Association and Nanjing Forestry University. This strategy has helped reduce damage of natural woodlands.

Recycled wood is another "green" option in making building materials, including flooring and skirting. There are currently about 100 manufacturers in China adopting this option for their art parquet floors, with N.S.F. Flooring Co. Ltd said to be the first in the country to do so.

N.S.F. employs wood from old houses and planks, and log cutoffs. General manager Wu Wen Kei said the materials are $62 to $125 per ton or about $6 for every square meter, less than one-tenth the cost of virgin wood, which is $770 to $1,500 per ton.

Recycled wood has a low moisture content and requires minimal drying, consequently reducing production costs.

The company cuts the material into smaller pieces to form art parquet or mosaic floors. Finished models start at $31 per square meter and reach $750. The most expensive designs exceed $900.

For small furniture pieces, Joint Creative takes the green trend further by replacing wood with materials that are more biodegradable, including paper. The designs are popular in France.

AWP International Wood Products uses thermally modified wood from Austria to replace expensive tropical timber. Also referred to as thermowood, the input is heat-treated to boost stability and resistance to decay without the use of chemicals. It costs about 20 percent less than solid timber.

China makers will continue facing high wood costs in coming months due to limited domestic supply.

The country's timber yield has declined in recent years due to several natural disasters affecting key hubs. These include the heavy rain and snow that hit South China in early-2010 and the summer drought and flooding in the Southwest.

Overseas material vendors have introduced hefty duties, pushing up the cost of foreign wood, compounding the difficulties of China makers. Forty percent of the country's timber requirements are imported, primarily from Russia, Africa, South America and Southeast Asia.

Russia, which is China's largest provider of the material, has a 25 percent export tax policy on logs. Costs there have already soared due to the forest fire in 2010.

Moreover, Russia plans to develop its domestic wood-processing sector in the next seven or eight years, shipping out finished pieces rather than catering to various manufacturing industries.