Description

Plywood is an essential engineered wood product widely used in construction, furniture, and packaging industries. In Nigeria, plywood production has experienced significant fluctuations, from a once-thriving industry in the 1960s to a near-collapse in the 1990s.

Today, Nigeria relies heavily on imports to meet its domestic plywood demand, despite the availability of raw materials and a growing market for plywood products.

Plywood production has a long history dating back to ancient Egypt, where thin wood layers were glued together to create stronger wooden sheets. The modern plywood industry began in the early 20th century, with large-scale production in Europe, the United States, and later Asia. Today, plywood is a fundamental component of modern construction, replacing solid wood in many applications.

Different types of plywood are available in the market, including softwood plywood, hardwood plywood, marine plywood, laminated plywood, commercial plywood, and specialty plywood. Each type serves specific applications, from construction and furniture making to specialized industries requiring fire-retardant and flexible plywood solutions.

The global plywood market reached USD 50.2 billion in 2024, with an expected growth to USD 74.5 billion by 2033 at a compound annual growth rate (CAGR) of four point five percent (4.5%) from 2025 to 2033. Increasing urbanization, infrastructure development, demand for flexible and lightweight wood products, and the expansion of the furniture and interior décor industry are key drivers of this growth.

The Nigerian government, in the 1960s, established nine integrated plywood factories with a total production capacity of 126,000m³ to reduce import dependence and generate foreign exchange through exports. However, by the 1990s, most of these mills shut down due to poor maintenance, mismanagement, and lack of investment.

Plywood production in Nigeria peaked in 1985 at eighty-nine thousand cubic metres (89,000 m³) but declined steadily in subsequent years. Since 1997, production has averaged fifty-six thousand cubic metres (56,000 m³) per year, with 2023 figures slightly lower at fifty-five thousand, nine hundred cubic metres (55,900 m³). As local demand increased to nine hundred and sixty-five thousand cubic metres (965,000 m³) per year, Nigeria resorted to importing plywood, mainly from China, South Korea, India, UAE, and Austria.

The Nigerian plywood market was valued at USD 8.81 billion in 2023 and is expected to grow at a compound annual growth rate (CAGR) of three point three percent (3.3%) to reach USD 11.05 billion by 2030.

Despite this high import reliance, Nigeria possesses an abundance of timber resources, including Mahogany, Iroko, Gmelina, and Teak, particularly in states like Ondo, Ogun, Ekiti, Edo, Cross River, and Akwa Ibom.

However, deforestation, illegal logging, and a lack of sustainable forestry management hinder the efficient use of these resources.

Several challenges have hindered the growth of Nigeria’s plywood industry. Poor infrastructure, high production costs, outdated machinery, and an unreliable power supply make local manufacturing less competitive compared to imports. The dependence on foreign plywood suppliers, coupled with the lack of government incentives and poor policy implementation, further compounds the issue.

Environmental concerns due to deforestation and illegal logging have also made timber procurement more challenging for local manufacturers. Additionally, smuggling and the influx of low-quality plywood products further erode the market for domestically produced plywood.

Despite these challenges, the Nigerian plywood industry presents significant investment opportunities, particularly in the production of Sumo Marine Plywood, Orbit Premium Plywood, Goldplex Marine, MR Grade Okume Commercial Plywood and Melamine Laminated Plywood (HDF).

High demand from the construction, real estate, and furniture industries creates a viable market for locally produced plywood. Government policies aimed at promoting local content in the wood industry provide further incentives for investors. Sustainable timber plantation development and modern manufacturing technology, including automated veneer peeling, resin treatment, and hot press technology, can enhance production efficiency and quality.

Additionally, Nigeria has the potential to become a major exporter of plywood within the ECOWAS region, tapping into regional markets and reducing reliance on imports.

Nigeria’s plywood industry has significant untapped potential. While historical setbacks have weakened production, increasing demand, availability of raw materials, and supportive government policies create an attractive investment climate.

Establishing a state-of-the-art plywood manufacturing plant for Sumo Marine Plywood, Orbit Premium Plywood, Goldplex Marine, MR Grade Okume Commercial Plywood and Melamine Laminated Plywood (HDF) could revitalize the sector, reduce import dependence, and contribute to economic growth.

Investors looking to enter the Nigerian plywood market should focus on sustainable raw material sourcing, modern production techniques, and strategic partnerships with the construction and furniture industries.

With the right approach, Nigeria can reclaim its position as a major plywood producer in Africa, creating jobs, boosting the economy, and promoting sustainable forestry practices.

This report seeks to examine the financial viability or otherwise of establishing a plywood production plant in Cross River State, Nigeria. The plant would produce Sumo Marine Plywood, Orbit Premium Plywood, Goldplex Marine, MR Grade Okume Commercial Plywood and Melamine Laminated Plywood (HDF)).

The capacity of the proposed plant is one hundred (100) cubic metres (m3) per day for the Sumo Marine Plywood, Orbit Premium Plywood, Goldplex Marine, MR Grade Okume Commercial Plywood and Melamine Laminated Plywood (HDF) productions plants.