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Global Mass Timber Panel (MTP) Industry During the COVID-19 Pandemic: Initial Findings

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For nearly two years, the COVID-19 pandemic has continued to affect global economies in various ways. It has been disrupting supply/value chains of manufacturers in all sectors, and the mass timber panel industry has not been an exception. However, the exact extent of the impact is difficult to measure by conventional means because the mass timber panel industry is specialty oriented and does not follow a commodity model of other forest products sectors. It has navigated without losses the global recession of 2008. Global surveys of the industry conducted before 2020 have hinted an exponential increase of its output volume (projected more than 2 million cubic meters for 2020) and a healthy growth in regions outside Central Europe. The objective of presented project was to use another survey designed to capture the effect of current crisis. The paper presents preliminary outcomes available ahead of the formal conclusion of that survey.
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Global Mass Timber Panel (MTP) Industry During the COVID-19 Pandemic:
Initial Findings
Pipiet Larasatie1*, Lech Muszyński1, Eric Hansen1
1Department of Wood Science and Engineering, Oregon State University. Address: Richardson Hall, Corvallis
OR 97331 USA. Email: pipiet.larasatie@oregonstate.edu , lech.muszynski@oregonstate.edu ,
eric.hansen@oregonstate.edu
*Corresponding author; ORCID 0000-0001-5861-7618; www.competitive-forest.com
Abstract
For nearly two years, the COVID-19 pandemic has continued to affect global economies in various ways. It has
been disrupting supply/value chains of manufacturers in all sectors, and the mass timber panel industry has
not been an exception. However, the exact extent of the impact is difficult to measure by conventional means
because the mass timber panel industry is specialty oriented and does not follow a commodity model of other
forest products sectors. It has navigated without losses the global recession of 2008. Global surveys of the
industry conducted before 2020 have hinted an exponential increase of its output volume (projected more
than 2 million cubic meters for 2020) and a healthy growth in regions outside Central Europe. The objective of
presented project was to use another survey designed to capture the effect of current crisis. The paper
presents preliminary outcomes available ahead of the formal conclusion of that survey.
Keywords: Cross-laminated timber, CLT, CLT business, CLT manufacturers, MTP business, MTP manufacturers,
survey, industry survey.
Introduction, scope and main objectives
The global economy, fueled by sustainability concerns to save the planet, is moving towards using renewable
materials for producing sustainable products. This trend has accelerated the use of wood in many aspects of
life, including as construction materials. Wood is believed to make the urban and built environment a more
sustainable space by providing an alternative to steel and concrete construction (Milaj et al. 2017).
With current innovations in engineered wood products, such as mass timber panels (MTP) and advanced
construction technologies, wood has been increasingly perceived as a viable option for high-rise building
material. Compared with concrete and steel buildings, high-rise buildings made mostly from wood are
perceived more aesthetically pleasing, creating a positive living environment, and using materials that regrow
(Larasatie et al. 2018). Due to these reasons, wood has important roles for achieving sustainable development
goals (SDGs), particularly goal no. 11 (sustainable cities and communities) and no. 12 (responsible
consumption and production).
The MTP industry is most prominently represented by adhesive-bonded structural cross-laminated timber
(CLT), a commercially fabricated massive composite panel product comprised of cross-layered pieces of
dimension lumber or structural composite lumber (SCL) bound together by structural adhesives. However, in
this paper, we include some information on similar cross-laminated mass-timber panels made of dimension
lumber but bonded with nails or hardwood dowels. While the most apparent distinction between these three
is the way the layers are bonded together, they also differ substantially in the raw material sourcing,
manufacturing technologies, load bearing capacities, and, consequently in the scope of potential uses.
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Based on two global MTP industry surveys conducted in Year 2016 (the first survey) and 2019 (the second
survey), 46 plant tours, and supplemented with information obtained from other sources, we observe
increasing production of a complimentary set of cross-laminated, of mass timber panel products using glue,
nails, wooden dowels and other alternative panel integration systems (Albee et al. 2018; Larasatie et al. 2020;
Muszynski et al. 2017; 2021; 2020). In most countries outside the Alpine Region of Europe, growth of the MTP
industry has been encouraged by governments motivated by the desire to find a stable, economically viable
outlet for substantial volumes of domestic lumber of lesser quality.
The state of the MTP industry at the end of 2019 could be characterized as strong. At that time, we estimated
the global annual output of the CLT industry to be approximately 1.44 million m3, based on 60 production
lines. The global annual per-shift capacity in 2019 attributed to 58 specific production lines was about 0.94
million m3. The Alpine region still accounted for over 70% the output volume and nearly 62% of the annual
per-shift capacity (Jauk 2019). Accounting for known CLT operations for which the produced
volumes/capacities were outdated or not available, the total 2019 output was estimated to be in a range of
1.6-1.8 million m3. Considering the number of high-capacity plants that came on line or reached full capacity in
2020, annual production was expected to reach 2.0-2.5 million m3, or more than twice as much as estimated
output volume in 2015/16 (Muszynski et al. 2017).
At the threshold of the 2020s the mass-timber panel (MTP) industry continued its exponential growth across
the globe, including production on each of the inhabited continents. More than 25 years into development of
CLT technology the industry still felt young and full of potential. However, that upbeat picture did not include
the COVID-19 pandemic. The big question since its onset in the first quarter of 2020 is how the pandemic
impacts the MTP industry and what are the perspectives of MTP players regarding the post-pandemic new
normal. Therefore, in this paper, the aim of the 2021 survey (the third survey) has been to capture the effect
of the global COVID-19 crisis on the MTP industry.
This paper is based on the initial findings of the third survey, along with previous reports of the first and
second surveys (Larasatie et al. 2020; Muszynski et al. 2017; 2021; 2020). The principal premise of this work is
that existing CLT operations across the globe provide a living laboratory for understanding the state-of-the-art
and the development of the CLT industry.
Methodology/approach
The questionnaire for the third survey was carefully adapted from the first two. The changes focused at
replacing a set off questions related to more static aspects of the technology with questions related directly to
the effect of the pandemic. The updated survey was translated into seven languages: German, Italian, French,
Japanese, Russian, Spanish, and Chinese by a professional translation company based in the U.S. Each
translation to a foreign language was then translated back to English by native speakers of the respective
languages who were familiar with the industry and the professional terminology used in the survey.
Divergences between original and back-translated version were then discussed and corrected.
Each of language version of a questionnaire was placed into Qualtrics, an online survey platform, for
appropriate delivery for easy access by the target respondent. Each respondent also had access to the English
version of the questionnaire. We generated unique survey links for every targeted respondent to check the
progress of their responses and guide follow up contacts.
Our population was 122 global mass timber panel (MTP) manufacturers known to the research team at the
time of deploying the survey. The list of companies used in the first and second surveys were revised and
expanded to include a possibly complete representation of companies producing cross laminated panels
constructed with mechanical connectors (nails and hardwood dowels) as well as companies who launched
production until early 2021. The information on new companies was acquired through trade journals, online
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searches, personal contacts, and regional trade associations. Whenever possible, the questionnaires were sent
to individual contacts, targeting company owners, executives, sales managers, and/or production engineers.
General company emails were used when no personal contact could be identified. Data collection was
incomplete at the time of this writing, but consisted of 15 responses, representing a 12% response rate.
Initial findings
To ensure anonymity, information is presented in aggregate format and when discussing regional differences,
the data is parsed by large regions defined in a way to avoid exposing information from a single manufacturer
(Figure 1). Nearly half of responses comes from North American companies, followed by other countries in
Europe than Alpine region (27%), Asia Pacific including Australia and New Zealand (20%), and Alpine region in
Europe (0.07%). These companies are varied in their annual MTP production output, ranging from one to six
digits of m3/year.
Fig. 1: CLT/MTP producing regions.
Ownership of the CLT/MTP plants varies from family enterprises to international holdings. Since almost all
panels are custom produced for specific projects, there is no size standard for MTP panels. As a result, press
types and sizes greatly varied (Figure 2).
Fig. 2: a) DYI hydraulic press; b) press embedded in a turn-key automated line.
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When asked to compare their CLT/MTP production before the outbreak of COVID-19 and following
implementation of various closures and restrictions to their current production, our respondents to-date are
perfectly divided into three categories of those who managed to increase the production, some were forced to
decrease the production level, while others maintain the production at the pre-covid level. For companies who
stated an increased production, it is mainly due to previously planned business expansion. While companies
experiencing a decreased number cited changes in demand as the cause.
COVID restrictions on the workplace and the inability of employees to work due to COVID (like) symptoms
have affected one company to reduce 75% of its production, compared to the pre covid. The other company,
with 70% of decreased production than the pre covid mentioned an increase in raw material cost as one of the
major problems.
Three of our respondents mentioned there are changes in their markets before and after COVID-19. Two of
them have an increase in medium-scale public buildings while another respondent has more demand in single
family residential housing for the last year.
Discussion and conclusions
Since the publication of the first survey (Muszyński et al. 2017), substantial production capacity has been
added outside the Alpine region of Europe, including a new plant in South Africa, a pilot plant in China, two
short lived lines in Indonesia and feasibility studies conducted in South Korea, Brazil, and Chile. In most
countries outside the Alpine Region, the growth of CLT/MTP industry has been encouraged by the
governments. It is motivated by the desire to add economic values for their domestic lumber, with some lesser
quality species. The incentive programs used as a tool in these campaigns vary by country in terms of scale,
form, and duration. It is important to note that not all of these programs are successful.
Despite a history of over twenty years in Alpine Europe, cross-laminated timber is still a relatively new product.
Industrial organization theory suggests that innovativeness differs across an industry’s life cycle (Utterback
1994). Product innovation is higher during early stages of the life cycle and declines as industries mature, while
process innovation gains importance in later stages. Evidence of this early product innovation is creation of
dowel-bonded, cross-laminated panels; nail bonded, cross-laminated solid wood wall; mass plywood panels;
and dowel laminated timber (DLT) decks, produced in North America, in which all laminations run parallel to
each other.
Given the unique nature of the industry, we are not confident that mass timber panels will follow the
theorized pattern where one dominant product design is accepted, becomes a standard, and subsequently
manufacturers concentrate on process efficiencies. It is important to stress that the mass timber panel
industry is an exception to the traditional commodity-oriented forest products industry at large, even if one
compares it to other sophisticated Engineered Wood Products (EWP) such as glulam, Laminated Veneer
Lumber (LVL), Parallel Strand Lumber (PSL), or I-joists.
Large panel dimensions, weight, and high unit value work against standardization (Muszyński et al. 2021). In
fact, almost all mass timber panels are custom manufactured for specific jobs, which requires a substantial
level of flexibility in the manufacturing process. Previous findings show that a very low percentage of mass
timber panels are produced as “blanks” (Muszyński et al. 2017), and even these are made “to order”, not
placed into inventory. Due to this, we do not expect a significant amount of standardization or
commoditization to take place in the short to medium time frame. This is despite the fact that standardization
is the normal approach for mainstream forest sector companies when they develop new products, and is an
expectation often expressed by experts both within and outside the industry.
When considering the development of the mass timber sector, it must always be kept in mind that
manufacturing mass timber panels is one component of a complex process that results in a final product, a
usable structure. Panels are not directly marketed to general consumers. Success of a panel manufacturing
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operation requires a deep immersion in a complex building ecosystem and a greater than in traditional
construction technologies level of integration of project management along the supply chain. This is why many
mass timber panel producing companies house their own engineering design teams and almost as many own
construction services companies. Vertical integration through control of these operations within that
ecosystem assures a seat at the table and helps guarantee a market.
The adoption/diffusion of a new product into the market is typically a lengthy process led by “innovators”
(Rogers, 2003). The signature mass timber buildings being created around the globe today are designed by
innovating teams which almost invariably include panel manufacturers along with partners representing other
elements of the supply chain involved in projects from their earliest stages. Early adopters learn from the
experiences of innovators. If the outcomes achieved by the innovators are sufficiently positive, these early
adopters then enter into the picture, and this is when product volumes can see significant growth. Eventually,
the less innovative members of the marketplace also adopt the product or technology. The ecosystem
described above likely slows the adoption/diffusion process since alignment of multiple innovators is
necessary, not just a single buyer adopting a new product.
Given currently available information, we feel it is safe to predict further product innovation as the global mass
timber panel industry continues slow- to medium-paced growth, even as the ultimate impact of pandemic on
the industry remains unclear. It is also safe to say that innovation in the production of panels is closely related
to innovation in connectors, construction technology, integrated project management and a constellation of
allied products and services they depend on.
Acknowledgements
This project was funded by USDA ARS program. The authors also acknowledge supports from Taylor Barnett
and Evan Bright.
The views expressed in this information product are those of the author(s) and do not necessarily reflect the
views or policies of FAO.
References
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Jauk, G. 2019. “Special CLT Issue.” Holzkurier.
Larasatie P, Albee RR, Muszyński L, Guerrero JEM, Hansen EN. 2020. Global CLT Industry Survey: The 2020
Updates. In Proceedings of the 2020 World Conference on Timber Engineering, Santiago, Chile.
Larasatie P, Guerrero JEM, Conroy K, Hall TE, Hansen EN, Needham MD. 2018. What Does the Public Believe
about Tall Wood Buildings? An Exploratory Study in the US Pacific Northwest.” Journal of Forestry,
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Rogers, E. 2003. Diffusion of innovations (5th ed.). New York, NY: Free Press, 551 pp.
Utterback, JM. 1994. Mastering the Dynamics of Innovation, How Companies Can Seize Opportunities in the
Face of Technological Change. Boston, MA: Harvard Business School Press, 253 pp.
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Mass-Timber Panel (MTP) Industry and Its Supply/Value Chain
  • L Muszyński
  • P Larasatie
  • E N Hansen
  • Jem Guerrero
  • R R Albee
Muszyński L, Larasatie P, Hansen EN, Guerrero JEM, Albee RR. 2021. Mass-Timber Panel (MTP) Industry and Its Supply/Value Chain. In Proceedings of the 64th International Convention of Society of Wood Science and Technology, Flagstaff, Arizona, USA.