LONDON--(BUSINESS WIRE)--Technavio’s latest report on the wood manufacturing market in Bosnia and Herzegovina 2016-2020 provides an analysis on the most important trends expected to impact the market outlook during the forecast period. Technavio defines an emerging trend as a factor that has the potential to significantly impact the market and contribute to its growth or decline.
The wood manufacturing market in Bosnia and Herzegovina is expected to exceed USD 174 million by 2020, growing at a CAGR of over 6%. Chandrakumar Badala Jaganathan, a lead analyst from Technavio, specializing in research on textile, fiber, and composites sector says, “Bosnia and Herzegovina has a strong heritage of manufacturing wood-based products and is well known globally as a producer of high-quality wood products that meet both the domestic and international standards. Increase in adoption of advanced technologies during the forecast period is predicted to optimize the utilization of wood and increase the efficiency of processes used in the wood manufacturing industry.”
The top three emerging trends driving the wood manufacturing market in Bosnia according to Technavio chemicals and materials research analysts are:
- Rise in adoption of advanced technology
- Increase in investments for development of biomass-based energy
- Growth opportunities in niche segments
Rise in adoption of advanced technology
Medium and large-scale manufacturers of wood-based products are focusing on the adoption and implementation of advanced machinery, such as the CNC, to enhance efficiency and manufacture value-added products. These machines employ technical software such as CAD and CAM, which not only help increase productivity, but also enable manufacturers to produce goods of complex designs and shapes in an efficient manner. Such an enhancement in productivity and efficiency is expected to contribute to the profit margins of manufacturers of wood-based products.
Increase in investments for development of biomass-based energy
Bosnia and Herzegovina has an abundant supply of wood that can be used for the production of biomass-based energy. According to the 2015 statistics provided by Foreign Investment Promotion Agency (FIPA), the current usage of wooden pellets in the production of biomass-based energy amounts to 150,000 tons, and approximately 1 million tons of wooden pellets are left unutilized. As wooden pellets are by-products of wood-based products, such as furniture, their procurement and utilization by producers of biomass-based energy generates additional revenue for the manufacturers of these products.
The government of Bosnia and Herzegovina is implementing measures to maximize the utilization of unused resources, such as wooden pellets, for the production of biomass-based energy. In January 2015, the European Bank for Reconstruction and Development provided a loan of USD 7.88 million for the construction of new biomass boiler plant in Prijedor. This plant will help the country in meeting its 2020 renewable energy targets. The project is also supported by the Swedish International Development Cooperation Agency, which provided a funding of USD 2.22 million in 2014.
Growth opportunities in niche segments
The wood-based boards segment in Bosnia and Herzegovina is largely under-penetrated. The products in this segment include hardwood, plywood, particle boards, and medium-density fiberboards. “New entrants can utilize the potential of such niche segments to establish themselves in the market. Competition in these niche segments is also low as there are very few manufacturers operating in these segments,” says Chandrakumar.
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