The wood floorcoverings sector has been negatively affected by the recession with a decline in non-essential consumer spending and a significant downturn in the housing market key factors in an estimated 19% decline in market value 2008-10. In 2010, the wood flooring sector (solid wood, engineered wood and laminates), was estimated to account for around 16% value share of the total UK floorcoverings sector, which is estimated to be worth some £1.8bn. The contract woods sector has also experienced more difficult conditions in 2010 and into H1 2011 as key end-use sectors experienced significant downturn in new build output as well as refurbishment levels.

The market has been particularly affected by the downturn in the housing market with installations into new build impacted by declining completion numbers, but with woods also facing increasing competition from alternative floorcoverings such as porcelain and natural stone floor tiles.

Although the recession has had a negative impact on laminate sales, this sector was already experiencing a downward trend prior to 2008.  Indications are that the peak for laminate sales occurred in 2004 with the sector experiencing an estimated 14% value decline 2005-08. The experience of the laminates sector over the last 2 years has been for 21% decline in value 2008-10, with the lower market sectors particularly affected by the downturn in domestic DIY installations

Contrasting with the experience of laminates, solid & engineered woods experienced growth of an estimated 22% 2005-08, but has subsequently declined by around 13% to 2010 with value of around £103m. Solid and engineered woods have experienced a measure of interest in the middle and upper market sectors stimulated by the “improve not move” trend.

Imports continue to dominate the market given the leading positions of some international floorcovering groups in the UK market. 

The market for wood flooring into H2 2011 is currently described as difficult with sources indicting that trading has been volatile throughout the year. The recovery of the housing market remains key to the revival of the wood floorcoverings market.

The contract sector is likely to recover at a slower rate than the domestic market indicating potential for some reversal of the trend towards contract installations in the end-use application mix for wood floorcoverings in recent years.  Traditionally, the contract floorcoverings market has been considerably less volatile than the domestic sector, but future growth for contract woods is largely dependent on recovery in key commercial sectors.

Decline in laminate volumes is likely to continue with the market having peaked in 2004.  However, the trend in the market in recent years towards more middle and upper market laminates, could help to partly offset the impact on value decline. 

The prospects for solid and engineered woods appear to be more positive than for laminates, with annual growth rates of 3-5% currently forecast to 2015 when market value is expected to reach £116m.