Prospects for Growth in Wood Plastic Composite Markets

August 15, 2018

Posted By Marcel Vroege

As a sustainable bioproduct, the demand for wood plastic composites (WPCs) is set to grow steadily, especially outside of the mature North American markets. With rapid innovation in materials recycling and extrusion technology, and demand growth in new geographies and end-use applications, the market for WPCs is exciting.

WPCs mix natural wood fibers and plastic polymers to create a versatile material with many end-use applications. Typically, WPCs combine saw dust or wood-flour with a variety of plastic polymer types and other fillers. The composites offer better mechanical properties than traditional products, such as rigidity and strength compared to other plastic materials, and improved weather resistance and lower maintenance needs compared to traditional lumber. WPCs are often more cost competitive than other materials, such as pressure treated lumber, and can be made from recycled materials.

Wood used in bio-composites is often obtained from side streams of wood products and pulp production, making it a low cost feedstock and monetizing wood material that otherwise might be wasted. Wood wastes produced during manufacturing of wood-based products such as paper, cardboard, crates, pallets, furniture and by-products of textile industry could also serve as reinforcement in a matrix of plastic composites, depending on the availability and suitability of these recycled materials. The wood fiber could also be in the form of fines that are formed as residue in the transportation stage of industrial bioenergy pellets, which are often exported overseas.

Today, the WPC industry has found opportunities to recycle wastes from both wood and plastic processing operations. There is also tremendous potential to incorporate construction and demolition waste streams. A good example is a Finnish company, CONENOR, which is specialized in composite extrusion in collaboration with a Spanish R&D center, TECNALIA. The material combines post-consumer waste wood and mineral wool recycled from construction and demolition waste, as well as other materials such as gypsum plaster board, high-density polyethylene and recycled WPC. A multilayer design ensures that the recycled construction and demolition material is not visible on the surface of the finished product. Additionally, there is now budding innovation in the use of WPCs in core material in the sandwich injection molding process.

The recycling of plastics has been adopted by many of the large WPC producers in the United States, with some producers accepting plastic donations and looking to establish commercial recycling partnerships. Because plastic is the largest cost component of WPC, recycling today plays a large role in the production cost reduction. The wide variety of polymers and fillers, including fiber types, fiber preparation techniques and possibilities for fiber surface modifications, open opportunities to tailor the WPC materials to specific end-product requirements.

A sudden halt of exports of low quality plastics recyclables to China at the beginning of 2018, creates a surplus of plastics recyclables (almost 700 million metric tons) that will likely now be sent to landfills for a gate fee. This has become a burgeoning problem for waste management authorities. WPC producers with the availability to process a wide range of low-quality plastics will have a cost advantage over other producers by taking on these plastics at a negative cost.

New end-use applications for which these assortments of plastics are suitable are being continuously developed together with large brand owners looking to reduce their overall carbon footprint. One example is the partnership between Stora Enso and Orthex. Through this partnership, a new bio-composite has been developed, called DuraSense™, which is produced from spruce and pine, and can be found in things like disposable utensils, furniture, pallets, tools and other consumer products, such as toys, toothbrushes, and decking, as well as outdoor furniture. In fact, most of the non-renewable materials used today can be replaced by bio-composites.

The largest growth area for WPCs has been building products, like decking, fencing, industrial flooring, landscape timbers, railings and moldings, which can replace pressure treated lumber. Demand for sustainable construction supports this growth. Growth in the market may also be seen due to the phase-out of chromated copper arsenate (CCA) treated wood. The replacement of the CCA with other preservatives, which are often costlier, gives the WPC market an opportunity to grow. Advancements in WPCs are being investigated to replace treated timber currently used to support piers and absorb the shock of docking ships.

"Because plastic is the largest cost component of WPC, recycling today plays a large role in the production cost reduction opportunities."

Currently, extrusion technology in the plastics industry has evolved to the ability of using up to 50% wood flour together with polyethylene. When combined with bioplastics, the final WPC material is considered very eco-friendly. In Orthex’s GastroMax BIO™ products, used for food preparation, wood fiber is blended with sugarcane. This combination of bio-based materials has been estimated to reduce the carbon footprint of the final product by up to 80% compared to virgin plastic materials.

"Extrusion technology in the plastics industry has evolved to the ability of using up to 50% wood flour"

North America is the largest market for WPCs. The WPC market is projected to grow between around 5 and 10% over the next 5 years, with the strongest growth prospects in Europe and Asia. The largest growth segments are both the residential and building markets, mainly decking. With around 1 million metric tons products capacity in the USA and growing, and just under 950 thousand metric tons per year WPC demand, the mature market in the USA is well poised for export markets.

The growth will be driven by investment in infrastructure and the replacement of old housing materials with advanced materials. Another driver for the increased use of WPCs is the fluctuating petrochemical prices that affect plastic markets, as well as consumer awareness of environmental concerns.

In North America, a purchase mandate called ‘Bio-Preferred’ has identified WPCs used for various end-uses as categories for mandatory federal purchasing, if the product meets several criteria, including a minimum of bio-based content, including noise barriers and structural panels.

Despite the many positive properties of wood-plastic-composite, there are also negative characteristics that hinder the use of WPC in many product areas, such as automotive interiors in which the surface texture requirements are high. The need for consistently metering and forcing the low bulk density wood fiber into the processing equipment, avoiding thermal degradation of the wood fiber during processing, and removing moisture with resin dryers have all hindered the deployment of WPCs. Increased water intake, which may result in swelling of near-surface particles, increased odor emissions, poor surface textures and distortion of the components are unacceptable for many applications.

However, innovation is creating opportunities for both raw material suppliers and consumer product manufacturers. New studies and developments have been able to define a variety of material combinations with their respective microstructure, chemical interactions, thermal stability, mechanical properties, surface wettability and swelling capacity. For example, a process technique called sandwich injection molding can eliminate the negative properties of WPCs by enclosing it with a pure polymer.

With materials and technologies rapidly developing, the market will present both challenges and opportunities. Whether you are a raw material supplier, technology developer, converter, WPC producer or brand owner, Indufor can help you see the forest through the trees along the entire WPC value chain.

Indufor’s expertise ranges from forestry valuations, supply chains, sustainable raw material sourcing, harvesting & logistics, site selection, feasibility, strategic advisory, M&As, markets and innovation, to offer you a full range of support and advisory services that help you realize opportunities and mitigate risks in this dynamic market.

Indufor is deeply committed to creating added value from biomass, supporting bio-based products industries improve their performance and reach new markets. Through deep expertise in forest sectors and landscapes,  Indufor aims to ensure the long-term health and productivity of the forests while supporting the circular economy.

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Marcel Vroege

Head of Forest Industry & Bio Solutions, Asia Pacific

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