Market Analysis Report: Canadian Secondary Wood Manufacturing Industry (2012-2024)

This report analyzes the Canadian secondary wood manufacturing industry, classified under NAICS codes 337, 3371, 3372, 32191, 33711, and 33712. The analysis spans from 2012 to 2022, and all available data from 2023, focusing on total revenue trends, expense patterns, profit margins, and sector-specific insights. It also addresses market drivers, challenges, and an outlook for 2024.

Review of the Last Ten Years (2012-2022):

  1. Financial Performance Analysis (2012-2022):

Total Revenue Trends: The decade exhibited a consistent upward trend in revenue across all sectors, signifying robust market demand and industry health. Notably, Millwork (NAICS 32191) experienced substantial revenue increases. The post-2020 period marked a significant growth phase, suggesting a rebound from the impacts of global events around 2020.

Total Expenses: These increased proportionally with revenue, reflecting effective cost management and operational scalability.

Profit Margins: Generally positive across sectors, highlighting the industry’s healthy financial state.

  1. Sector-Specific Insights:

Household and Institutional Furniture (3371) & Office Furniture (3372): Stable demand driven by trends in residential and corporate sectors. The Household and Institutional Furniture sector generally outperformed the Office Furniture sector in terms of total revenue. Both sectors experienced a similar pattern of decline in 2020 and subsequent recovery, reflecting the broader economic trends influenced by the pandemic.


Millwork (32191): Significant growth post-2020, likely spurred by construction and renovation activities. Millwork has continued to hold the highest profit margin.

Wood Kitchen Cabinet and Countertop Manufacturing (33711) & Household and Institutional Furniture Manufacturing (33712): Aligned growth with housing market trends. The Wood Kitchen Cabinet and Countertop Manufacturing saw its revenue double from 2012-2022.

  1. Market Drivers and Trends:

Economic Growth: Correlated with increased consumer spending (in this sector) and investment in housing and commercial spaces as billions continue to pour from Federal and Provincial programs that encourage, if are not directly linked to, increased private and corporate investment.

Technological Advancements: A key driver in product innovation and manufacturing efficiency. The continued adoption of automated machinery and digital technologies have been critical to offsetting the increase in the cost of labour, materials, and supplies.

  1. Challenges and Outlook:

Global Supply Chain Disruptions: Continually affecting production and costs. However, the forestry industry has continued to see growth and government support, leading to a stronger domestic supply chain and hopefully a future decrease in the cost of materials and supplies.

Manufacturing space: At an all-time premium aggravated by a lack of property zoned for manufacturing and an uptick in foreign investment in industrial properties.

Regulatory Environment: Emphasis on compliance with environmental and safety standards if not already trying to exceed those levels for market reasons. SMEs may need to anticipate an increase in admin-related expenses if The Formaldehyde Emissions from Composite Wood Products Regulations (CANFER) is not amended to alter its chain of custody requirements.


Analysis for 2023:

The data for 2023 continues the trends observed in previous years, demonstrating sustained growth in the industry. Sectors such as Furniture Manufacturing (337), Household and Institutional Furniture (3371), and Office Furniture (3372) have maintained their growth patterns, indicating market resilience. The year 2023 also saw the continued effectiveness of cost management strategies, as expenses in these sectors increased proportionally with revenue. This balance reflects operational efficiency and sound financial health, with the industry maintaining healthy profit margins.

Market Dynamics: New orders across sectors such as Millwork [32191], Office Furniture [3372], and Wood Kitchen Cabinet Manufacturing [33711] show fluctuations, reflecting market demand and economic conditions. .

Production Challenges: Notably, unfilled orders in sectors like Millwork and Office Furniture occasionally spiked, suggesting production bottlenecks or supply chain constraints during high-demand periods.

Operational Efficiency: The correlation between new and unfilled orders highlights operational efficiency within sectors. Close alignment suggests better market responsiveness, while discrepancies point to potential issues in production capacity or supply chain management.


2024 Outlook Based on Historical Trends:

Looking ahead to 2024, the historical trends suggest a favorable outlook for the Canadian secondary wood manufacturing industry. The consistent growth observed over the past decade, coupled with the strong performance in 2023, indicates potential for continued expansion. Key factors that could drive this growth include ongoing economic recovery, technological innovations, and a shift towards sustainable practices. However, challenges such as supply chain disruptions and competitive pressures remain. The industry’s ability to adapt to these challenges, along with its focus on innovation and sustainability, will likely be critical for sustaining growth in 2024 and beyond.

The Canadian secondary wood manufacturing industry demonstrates robust market presence and potential for growth. Its adaptability to market changes, technological advancements, and focus on sustainability are key to future success. The consistent financial health across sectors provides a solid foundation for future strategic planning and investments.  Strategic adaptations in response to global market shifts and evolving consumer preferences will be crucial. Investments should focus on lean manufacturing technologies, sustainable business practices, and smart furniture development.



Tyler Holt is the Editor of Wood Industry / Le monde du bois magazine. He has a master’s degree in literature and publication, and years of experience in the publishing and digital media industry. His main area of study is the effect of digital technologies on industrial and networked production.


You might also like