According to Milan-based industry researcher CSIL’s preliminary estimates, world production of furniture in 2021 will exceed US$500b – a stronger-than-expected recovery, mainly due to the major contribution from Europe and Asia.
This estimate is based on data from official sources, both national and international, covering the 100 most important furniture manufacturing countries.
Demand was globally strong during the period, with differences across countries and segments. However, production growth is subject to a series of constraints – raw material scarcity and growing prices, supply chain challenges, high costs of transport and container shortages. Moreover, systemic uncertainties, deriving from continuing trade restrictions and changing supply chain strategies, affect the entire sector.
More than half of world furniture production took place in APAC, states CSIL. The main producer was China, followed at a distance by the US, Germany and Italy.
In the last 10 years, the international trade of furniture has grown faster than furniture production, and has consistently amounted to about 1% of international trade of manufactures, reaching about US$152b in 2018/19. The pandemic caused stagnation in 2020, but 2021 promises to be a year of steep growth. The prospects for 2022 and 2023 are favourable, says CSIL, yet there remain uncertainties deriving from supply constraints and transport problems.
The bulk of international trade of furniture originates in China, Vietnam, Poland, Germany and Italy, and goes to the US, Germany, France, the UK, and the Netherlands (as a trading hub).
On the consumption side, the lockdown experience highlighted the importance of the home, which acquired a new significance both for living and working. Spending more time at home emphasised the usefulness of having functional spaces for the whole family, and possibly modular furniture also suitable for working from home.
Consumers invested in improving their living spaces, often allocating to furniture substantial portions of income made available because of decreased expenditure for other leisure activities. For this reason, the worldwide pandemic-induced contraction in furniture consumption in 2020 was limited in size, affecting the different products of the furniture spectrum in different ways. Office furniture was more severely hit, following the decline in investments by both the industry and the service sector. Strong growth has resumed in 2021, with furniture consumption reaching a level well above pre-pandemic values.
According to the IMF World Economic Outlook (October 2021), world GDP growth is resuming in 2021 (+5.9%), in 2022 (+4.9%) and 2023 (+3.6%). Growth prospects remain stronger for emerging and developing economies than for advanced economies. However, uncertainties remain high – differences in the speed of recovery (both across and within countries) will be substantial, and the downside risks remain significant.
CSIL's World Furniture Outlook report, issued this month, assumes that the international furniture consumption growth will reach about +4% in 2022 (in real terms). Among large markets (greater than US$5b of furniture consumption) the countries expected to have a greater rebound in furniture consumption growth are European and Asian countries.
Download the report here, or contact [email protected] for more information.
