Timber construction market set to more than double as engineered wood rises

Global, September 23, 2025

News Summary

The global timber construction market is projected to more than double as engineered wood adoption accelerates. Future Market Insights forecasts growth from USD 17.7 billion to USD 44.2 billion by 2035 with a 9.6% CAGR, driven by residential demand, CLT, glulam and LVL technologies, and policy shifts toward net-zero buildings. The early phase adds significant value, while 2030–2035 is expected to deliver the largest share of growth. Regional leaders include China, India and parts of Europe. Challenges such as fire safety and code limitations are being addressed through innovation and hybrid construction approaches.

Timber construction market set to more than double by 2035 as engineered wood rises

The global timber construction market is on track for rapid expansion through the next decade. Global timber construction market projected to grow from USD 17.7 billion in 2025 to USD 44.2 billion by 2035 (Future Market Insights figures). The implied pace is a Market forecast CAGR (FMI): 9.6% between 2025 and 2035. That change represents an Absolute increase projected (2025–2035, FMI): USD 26.54 billion and a Total growth projected (2025–2035, FMI): 150.1%.

Short- and medium-term phases

The expansion is not uniform. In the near term, the market is expected to grow from USD 17.68 billion to USD 27.94 billion during the 2025–2030 phase (FMI), an increase of USD 10.26 billion that accounts for 38.6% of the total 2025–2035 forecast growth (FMI). The later five years, 2030–2035 (FMI), are predicted to add USD 16.7 billion, driving 61.4% of the 2025–2035 expansion (FMI).

What is driving the surge

Growth drivers include an increasing focus on green architecture, stronger demand for environmentally friendly building materials, and a rising adoption of timber in modern architectural designs. Policy shifts toward net-zero carbon buildings and circular economy principles are expected to push demand for timber systems with enhanced structural performance and sustainability credentials.

Product types and technology trends

Engineered wood products are a central force behind taller, more complex timber buildings. Key engineered products expanding structural capabilities include cross-laminated timber (CLT), glued laminated timber (glulam), and laminated veneer lumber (LVL). These technologies underpin the forecast that the 2030–2035 period will be characterized by the widespread adoption of engineered wood products, advancement in timber construction technologies, development of high-rise timber buildings (FMI).

Market structure and segments

The market is segmented by end use, timber type and region. The Residential segment projected to account for 61.9% of the timber construction market in 2025 (FMI), supported by timber frame construction in single-family homes, multi-family housing and low-rise residential projects. The Softwood projected to represent 54.7% of timber construction demand in 2025 (FMI), with species such as pine, spruce and fir dominant because of abundance, mechanical properties and well-established supply chains.

Regional and country growth

Growth will be global, but some countries are set to outpace others. Country growth CAGRs through 2035 cited (FMI summary): China leading at 13% CAGR; India 12%; Germany 11%; France 10%; UK 9.1%. Separate figures include Revenue from timber construction in China projected CAGR 12.96% through 2035 (FMI — specific figure), and Revenue from timber construction in India projected CAGR 12.0% (FMI). The U.S. market is expected to grow at Demand in USA projected CAGR 8.2% (FMI).

Market players and industry structure

Several established manufacturers and suppliers are listed as leading participants. One market leadership statement notes Company market leadership claim: Stora Enso Oyj (Finland) leads market with 14% global value share (FMI). Firms are expanding production, forming partnerships and investing in mass timber and engineered wood capacity to meet demand.

Challenges, innovation and hybrid approaches

Challenges include concerns about fire safety, durability perceptions and building code limitations in some regions. Innovations respond directly to these concerns: fire-resistant treatments, improved connection systems, prefabrication methods, digital design tools and hybrid construction systems that combine timber with steel or concrete to optimize performance and cost.

Case studies and on-the-ground examples

Examples of practical timber innovation include a modular approach from a startup creating eco-friendly homes from wooden blocks made with recycled materials. These blocks fit together with wooden dowels and are used in public housing pilots in Germany. Another experimental dwelling prioritizes dismantlable, glue-free joinery to enable reuse and adaptability, while a new multi-level parking structure in a German city uses timber elements combined with concrete foundations and offers extensive e-charging infrastructure.

Complementary research and alternate estimates

Other market estimates show slightly different baselines but similar growth patterns. One estimate put the global timber construction market at USD 16.13 billion in 2024 and projected it to reach USD 36.49 billion by 2033 at a similar CAGR in overlapping years.

What this means for stakeholders

Builders, architects and investors can expect demand for engineered wood, prefabrication and offsite manufacturing to grow. Governments and certification bodies will play a decisive role through building codes, green building incentives and support for low-carbon construction.

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Key features at a glance

Deeper Dive: News & Info About This Topic

Additional Resources

• Grand View Research: Timber Construction Market Report
• Wikipedia: Timber framing
• Interior Daily: Prefabricated timber homes see record approvals in Germany
• Google Scholar: prefabricated timber homes Germany
• designboom: Dismantlable wooden residence modular prototype (Germany)
• Google Search: dismantlable wooden residence modular prototype Germany
• DataCenterDynamics: Yorizon and Hochtief break ground on timber edge data center (Bad Lippspringe)
• Encyclopedia Britannica: timber data center
• ArchDaily: Wooden parking garage Wendlingen — Herrmann + Bosch Architekten
• Google News: wooden parking garage Wendlingen

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