flat-pack joinery imports market study report

Residential Flat-‐Pack Joinery Import Market Study

Developed by IndustryEdge Pty Ltd

for

Forest & Wood Products Australia Ltd

October, 2017


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Executive Summary Anecdotally, imports to Australia of (mainly) flat-‐packed joinery items has been

growing rapidly in recent years, including for installation into Australia’s residential

dwellings. Despite the persistence and strength of the narrative, there has been no

means of measuring the volume of these imports, their growth or other features of

them.

Import data does not provide sufficient information to specifically determine what is

joinery, what the imported items are made from or what size the items are.

Unfortunately, there is no single, obvious and clear means of assessing the volume of

joinery imported into Australia.

This analysis was commissioned by Forest & Wood Products Australia (FWPA) as

part of its endeavours to improve industry intelligence, provide tools for business

decision making and support market transparency. It deploys a series of inter-‐related

elements all focused on answering the question – ‘How much flat-‐packed joinery is

imported to Australia for installation in residential dwellings?’

The key findings of this analysis are that for calendar year 2016:

• The average or Standard House in Australia has 2.362 m3 of Particleboard

and MDF installed as joinery. It is less for other, generally smaller, housing

types such as townhouses, flats and apartments. (Element One)

• A total of 605,466 m3 of joinery was installed into Australian residential

dwellings. Of this, 462,661 m3 of Particleboard and MDF was installed into

Australian dwellings as joinery and a further minimum 142,806 m3 was

installed as part of renovations in the same year. (Element One)

• Locally made joinery accounted for 85.3% of the total, or 516,194 m3.

(Element Two)

• Therefore, on a residual basis, imported joinery accounted for at least

14.7% of total joinery items installed into Australian residential dwellings.

This was calculated as:


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o Total Market of 605,466m3 (Element One)

less

o Local Joinery substrate of 516,194 m3 (Element Two)

equals

o Imported Joinery of 89,272 m3 (14.7%)

This is the equivalent of the joinery installed into 37,789 average or standard

homes (Element Two).

Import data is inadequate for identifying more than a small proportion (less

than 25% or 17,977m3) of the known imports.

All of the confirmed data relates to Wooden Kitchen Furniture, with many other items

simply unidentifiable (Element Three).

A series of industry consultations and other data analysis was undertaken to confirm

the analysis, wherever information was available. (Element Four)

This analysis has utility for Australian industry because it:

a. Assesses the total amount of joinery installed to Australian residential dwellings,

and apportions market share between domestic and imported product;

b. Can be used in conjunction with housing forecasts to estimate the volume of

Particleboard and MDF that will be used in Australian residential dwellings in

subsequent years;

c. Operates transparently and can be revised and repeated to create a time series

and track trends over time. To that end, repeating this analysis in two years time,

to establish a three year (2016 to 2018) data series would be useful;

d. Establishes a methodological approach that can adequately bridge information

gaps, especially where related to sometimes inadequate trade data.


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Contents 1. Executive Summary

2. Contents

3. Background & Context to this Analysis

4. Methods, Constraints & Assumptions

5. Joinery in Australian dwellings – a 2016 SNAPSHOT

6. Element 1 – Volume of Joinery in Australian Dwellings

7. Element 2 – Consumption of joinery substrates in Australia

8. Element 3 -‐ Imports of joinery

9. Element Four – Cross-‐checking data

Appendix One – Glossary of Names, Terms and Definitions

Appendix Two -‐ Methodology

Appendix Three -‐ Assumptions

Appendix Four -‐ Joinery Substrate Calculations

Appendix Five -‐ List of Tables

Appendix Six – List of Figures


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Background & context to this analysis

How much imported flat-‐pack joinery is used in Australian dwellings? Australian industry has long been interested to know how much imported joinery is

used in Australia’s dwellings. In the absence of any formal assessment, speculation

has been continuous, albeit not always informed by data.

Whether an industry participant is a producer of the substrates from which joinery

is made (Particleboard and Medium Density Fibreboard [MDF]), a kitchen

manufacturer, cabinetmaker, joiner, installer or builder, there is inevitable

commercial and market interest in how much joinery is used in Australia’s dwellings

each year. That flows through to interest in how much joinery is imported, an area

in which the data is inadequate for traditional estimation methodologies.

Joinery, as distinct from furniture, is built-‐into a house and would thus rarely be

free-‐standing. Joinery, in this context, refers in particular to kitchen cabinetry,

bathroom and laundry cupboards, wardrobes, linen presses and the like. The vast

majority of joinery is imported in flat-‐pack formats, either ready to assemble or

partly assembled.

There is, of course, the same level of interest in imports of other flat-‐packed items

made from the same substrates – especially furniture items such as office furniture

and wall units like shelving, that are also largely imported in a flat-‐pack form. This

analysis does not address imports of those items, however, the same methodology

can be used to estimate the volume of imported flat-‐pack furniture among other

products.

Concerned by the lack of transparency and clarity about the proportion of imports of

flat-‐pack joinery manufactured from Particleboard and Medium Density Fibreboard

(MDF), Forest & Wood Products Australia (FWPA) resolved to develop a transparent

and reliable assessment of imports.


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As FWPA set out to do that, it became clear that the import data is a major constraint

to trade and market transparency, to an extent that business and sector level

decision-‐making capacity has been impaired for some years.

Anecdotally, imports of joinery products have grown from negligible to relevant.

There is however, no reliable estimation, or methodology for assessing how much

they have grown, or what proportion of the market imports hold.

This analysis was commissioned against that backdrop, to establish a ‘best available’

assessment of imports of flat-‐pack joinery used in Australian dwellings. The

assessment was to be conducted against a clearly described methodology, coming at

‘the question’ from multiple directions in the absence of a clear, single line of reliable

information.

The aim of the analysis is therefore to provide both an initial ‘answer’ as to how

much flat-‐pack joinery is imported to Australia each year for residential applications

– or at least, what proportion of the market imports are estimated to supply – and to

supply a robust, defensible and replicable methodology to allow the process to be

completed again, for comparative purposes.


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Methods, constraints & assumptions There is no easy or simple pathway to determine the amount of flat-‐pack joinery

imported into Australia each year, for residential dwellings. The import data is either

incomplete or non-‐existent.

In large part, this methodology seeks to address that situation by focusing on data

from a range of sources, all of which address the same question. This is a form of

data triangulation, supported by industry validation.

Methodology Because of the difficulties with respect to reliability, applicability and granularity of

import data, this analysis has used three separate but inter-‐related approaches,

supplemented by feedback and cross-‐checking with related data.

Within some limits, the approach taken has been to assess the ‘mass balance’ – the

volume of joinery substrate – that is likely to be used in Australia, in residential

dwellings (Element 1), compared with assessments of the volume of joinery

produced locally from locally manufactured and imported particleboard and MDF

(Element 2). Comparing the outputs of Element 1, with Element 2 provides the

implied volume of joinery that has been imported. Import data is then analysed to

attempt to identify flat-‐pack joinery imports, (Element 3) before outputs are cross-‐

checked by a range of industry guidance and feedback, and other publicly available

data.

See Appendix Two for a detailed description of the methodologies for each element

of this analysis.

Inevitably, informed assumptions are important in calculating the estimates

required for this assessment. Each of Elements 1 to 3 uses assumptions.

Constraints It is important to note the significant data constraints that impact each stage or key

point in this analysis. In the main, these can be described as ‘the absence of data’.

Wherever they occur and assumptions are used, the constraint and the assumption

used as a proxy for detailed data are indicated in this report.


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At a headline level, the data constraints are:

• Imported joinery is not clearly identified in trade data

• Imported particleboard (and MDF, but to less relevance) is not clearly identified

as to its ‘type’ or ‘end-‐use’ in trade data

• Commercial and industrial building work is not measured by number of

buildings or floor space

• Industry feedback by manufacturers, importers and stakeholders has been

averaged, and diverging views have been ‘weighted’ by IndustryEdge, particularly

in calculating end-‐use proportions for particleboard and MDF.

Assumptions As described above, this analysis uses assumptions to bridge data gaps. A full table of

assumptions is included at Appendix 3. Assumptions are, in summary, centred on:

Element 1

• Joinery in the HIA Standard House

• Volume of joinery substrate in the average Australian dwelling, by type

• Number of kitchen, bathroom and laundry renovations undertaken each year

Element 2

• Proportional use of particleboard and MDF in Australia, by end-‐use application

Element 3

• Limitation of relevant import codes

• Minimum and maximum import prices (AUDFob/unit), and other criteria, of flat-‐

pack joinery imports

Wherever possible, assumptions have been constructed with direct industry

involvement.


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Joinery in Australian Dwellings – 2016 Snapshot

Household Joinery 2016

[e. 605,466 m3 of PB and MDF]

226,741 dwelling

commencements [51.2% free-‐standing

houses]

2.362 m3 PB & MDF per

house [less for other dwelling types]

min.

142,806 m3 PB & MDF in renovations

>/= 89,272 m3

imported [min. 14.7%

462,661 m3 PB & MDF in new

dwellings


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Element 1: Volume of joinery in Australian dwellings Key Points for 2016

605,466 m3 of particleboard and MDF (joinery substrate) was used in joinery in

new dwellings (462,661 m3 or 76%) and renovations of dwellings (142,806 m3 or

24%) in the 2016 calendar year.

This is based on the following:

New Dwellings

• In 2016, Australia recorded 226,741 dwelling commencements, as follows:

Fig. 1: Australian Dwelling Commencements By Type: 2016 (Number)

Source: ABS

• Based on analysis that shows the volume of joinery substrate in the ‘Australian

Standard House’, inclusive of joinery doors, is 2.362 m3, new Australian dwellings

are calculated to use, on average, between 1.536 m3 (4+ Storey Flats) and 2.362

m3 of joinery substrate.

Free-Standing House

(116,074)

Flats - 4+ Storey

75,900

Townhouses - 1 Storey (7,200)

Townhouses - 2+ Storey (20,965)


Townhouses - 1 & 2 Storey (2,697)


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Table 1: Average Joinery Substrate in Australian Dwellings by Type: 2016

Dwelling type Joinery Substrate per Dwelling (m3)

Free-‐Standing House 2.362

Townhouses -‐ 1 Storey 2.126

Townhouses -‐ 2+ Storey 2.126

Flats -‐ 1 & 2 Storey 1.890

Flats -‐ 3 Storey 1.772

Flats -‐ 4+ Storey 1.536

Source: IndustryEdge research, based on industry feedback

• Multiplying the number of dwelling commencements, of each type, by the

calculated average volume of joinery substrate used in each dwelling type,

provides the total volume of joinery substrate used in new Australian dwellings

in 2016, as follows:

Fig. 2: Joinery Substrate Used in New Australian Dwellings By Type: 2016 (m3)

Source: ABS

The total volume of joinery used in new Australian dwellings in 2016 is the sum of

the above – 462,661 m3.

Flats - 4+ Storey

(116,549)

Free-Standing House

(274,213)



Townhouses - 1 & 2 Storey (5,097)



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Renovations of Dwellings

In 2016, the Housing Industry Association (HIA) reported the following renovations

were undertaken in Australia:

Table 2: Renovations in Australia: 2016 (Number)

Renovation Type/Room Number

Kitchen 145,401

Bathroom 218,311

Laundry 43,662

Source: HIA

• Based on the detailed analysis of the ‘Standard Australian House’, the average

volume of joinery used in each renovation is calculated as follows:

Table 3: Joinery Used per Renovation (m3)

Renovation Type/Room Ave. Volume of Joinery Substrate per Renovation (m3)

Kitchen 0.723

Bathroom 0.126

Laundry 0.234

Source: Davis Langdon Architects & IndustrEdge

• The total volume of joinery used in Australian renovations in 2016, is the sum of

the number of renovations undertaken, multiplied by the volume of joinery

calculated to be used in each renovation, as follows:


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Fig. 3: Joinery Used in Australian Residential Renovations by Type: 2016 (m3)

Source: HIA & IndustryEdge

The total volume of joinery used in renovations in Australian dwellings in 2016 is

the sum of the above – 142,806 m3.

The details of this analysis are provided below.

Defining a standard Australian dwelling Over time, a reliable method for calculating the amount of joinery – and arising from

that, the amount of particleboard and MDF in particular – used in Australian

dwellings, may commence with a well-‐defined and statistically accurate ‘average’

dwelling, based on its size and features.

Unfortunately, at this time, such a dwelling has not been adequately defined to be

both reliable for immediate analysis and replicable for future analysis. However, the

HIA has defined, by surveys of its members, a ‘Standard House’. Its use in this

analysis is a proxy for a future, more accurate analysis.

Leaving aside limitations, the use of the HIA’s Standard House as a basis for the

calculation of particleboard and MDF used in domestic joinery is adequate, though

not ideal. 1 The HIA Standard House is set out below.

1 The ideal data set from which the average would be derived is a representative and randomly selected sample

Renovated Bathroom

(27,451)

Renovated Laundry (10,201)

Renovated Kitchen (105,145)


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Fig. 4: HIA Standard House: 2010

Source: Davis Langdon Australia

The principal characteristics of the Standard House, as can be observed, are that it

consists of:

• 3 bedrooms, one with ensuite and walk in robe

• two bathrooms, including the ensuite

• separate laundry

• two living areas, one open-‐plan connected to the dining room and kitchen

• substantial outdoor decking.

Calculating joinery substrate used in the Standard House In its analysis of the Standard House for Forest & Wood Products Australia (FWPA)

the assessment of the cost of building that dwelling, architects Davis Langdon

Australia specified the amount of joinery that would be included in it. This is set out

in the table below, along with the calculated volume of joinery substrate used in

manufacturing the joinery. This is considered by cabinetmakers, joiners and others


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providing feedback on this analysis,to be a conservative estimate, with the volume of

joinery in the Standard House likely to be higher.

Table 4: Joinery Substrate (other than doors) Used in Standard Australian

House (m3)

Item No.

Description No. Units

No. Shelves*

Implied m3 of Substrate#

1 Bath Vanity, inc. cupboard under 1100 x 400 x 900

1 1 0.057

2 Ensuite Vanity, inc. cupboard under 850 x 350 x 900

1 1 0.047

3 Kitchen Bench, inc. cupboard under 4400 x 600 x 900

1 1 0.252

4 Kitchen Bench 2, inc. cupboard under 2750 x 800 x 900

1 1 0.206

5 Pantry Unit, inc, shelves 900 x 650 x 2100

1 4 0.132

6 Laundry Bench, inc. cupboard under 1200 x 600 x 900

1 1 0.083

7 Laundry Cupboard, inc, shelves 680 x 650 x 2100

1 4 0.111

8 Robe (Beds 2 & 3), inc. shelf 5000 x 600 x 16

2 1 0.232

9 Robe (Master) inc. shelf 4600 x 600 x 16

1 1 0.044

10 Storage Cupboard, inc. shelves 6000 x 600 x 16

1 6 0.501

Total 1.665 m3

Source: Davis Langdon Australia & IndustryEdge research

* The number of shelves has been adjusted for item 10. Storage Cupboard, based on feedback and advice provided to IndustryEdge

# Based on assessment set out at Appendix 4


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Table 5: Joinery Substrate Used for Joinery Doors in Standard Australian

House (m3)

Item No.^ Door Description Implied m3 of Substrate#

3 Kitchen Bench, inc. cupboard under 4400 x 900 0.063

4 Kitchen Bench 2, inc. cupboard under 2750 x 900 0.040

5 Pantry Unit, 900 x 2100 0.030

6 Laundry Bench, inc. cupboard under, 1200 x 900 0.017

7 Laundry Cupboard, 680 x 2100 0.023

8 Robe (Beds 2 & 3), 5000 x 2100 0.168

9 Robe (Master), 4600 x 2100 0.155

10 Storage Cupboard, 6000 x 2100 0.202

Total 0.697 m3

Source: Davis Langdon Australia & IndustryEdge research

^ Doors for vanities and bathroom joinery excluded due to potential variation in material use, including glass,

mirrors and open joinery etc # Based on assessment set out at Appendix 4

Based on the calculations, the average volume of joinery substrate used in joinery in

the Standard House is estimated to be 2.362m3.

Assumptions – substrate used in joinery

Importantly, the calculation relies upon the following assumptions:

a. HIA Standard House is satisfactory for this analysis, as set out by Davis Langdon Australia

b. All joinery substrate is 16mm thickness (implying it is melamine backed) c. Number of shelves has been estimated for each joinery type and adjusted by

IndustryEdge based on industry feedback d. An average of nine (9) cabinets is included in kitchens e. Plinths are estimated 100mm height f. No additional material has been estimated for bracing of joinery g. Other dwelling types have, on average, less joinery than the standard house h. Some joinery items are particleboard (shelves in particular) and are unlikely to

be imported as finished products, but may be imported as particleboard i. Doors for vanities and bathroom joinery excluded due to potential variation in

material use, including glass, mirrors and open joinery


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Calculating joinery substrate used in other dwelling types Taking the calculations for joinery in the Standard House, and applying industry

guidance on the average size and use of joinery products in the other major dwelling

formats provides a calculated estimate of the volume of joinery substrate used in the

average Australian dwelling, by type.

Table 6: Calculation of volume of joinery installed by dwelling type

Dwelling type

% of Joinery in HIA Standard House

Joinery Substrate per Dwelling (m3)

Free-‐Standing House 100% 2.362

Townhouses -‐ 1 Storey 90% 2.126

Townhouses -‐ 2+ Storey 90% 2.126

Flats -‐ 1 & 2 Storey 77% 1.890

Flats -‐ 3 Storey 75% 1.772

Flats -‐ 4+ Storey 65% 1.536

Source: IndustryEdge research, based on industry feedback

Calculating joinery substrate used in new Australian dwellings In 2016, based on the above, new Australian dwellings, of all types, used an

estimated 462,661 m3 of joinery substrates.

This estimate was devised from the above data, multiplied by the residential

dwelling commencements (by type) reported by the Australian Bureau of Statistics

(ABS). The data is displayed in the table below.


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Table 7: Joinery substrate used in new Australian dwellings, by type: 2016

Dwelling Type

2016 Commencements2

Joinery Substrate (m3)

Free-‐Standing House 116,074 274,213

Townhouses -‐ 1 Storey 7,200 15,308

Townhouses -‐ 2+ Storey 20,965 44,575

Flats -‐ 1 & 2 Storey 2,697 5,097

Flats -‐ 3 Storey 3,905 6,919

Flats -‐ 4+ Storey 75,900 116,549

Totals 226,741 462,661

Source: ABS & IndustryEdge research

Calculating joinery substrate used in the average Australian kitchen, bathroom and laundry renovation Australians are great renovators and remodelers. Despite this, there is only limited

formal data available to inform assessments of materials use in the main renovation

activities – updating kitchens and bathrooms.

Fortunately, an HIA data series, the HIA-‐GWA Kitchens & Bathrooms report for

2015-‐16, provides useful data and insights. It reports the estimated number of

kitchen and bathroom renovations for the year and forecasts those for the 2016-‐17

year, as set out in the following table. These two financial years have been averaged

to provide 2016 calendar year estimate.

The estimate of laundry renovations, based on industry input, is 20% of the number

of kitchen renovations for the year and for new dwellings, the assumption is that one

laundry is installed per dwelling.

2 ABS Catalogue 8752.0033 Table 3


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Table 8: New & Renovated Kitchens, Bathrooms & Laundries in Australian Dwellings: 2015 to 2017 & Average (Number)

Kitchens Bathrooms Laundries

New Renovation New Renovation New Renovation*

2015-‐16 231,800 144,670 441,200 217,000 231,800 28,934

2016-‐17 215,800 146,132 421,000 219,621 215,800 29,226

Average # 226,741 145,401 431,100 218,311 226,741 43,662

Total 372,142 649,411 255,821

Source: HIA & IndustryEdge estimates * Calculated based on 20% of the number of kitchen renovations each year # Average of the two financial years

The HIA reports the following useful insights in the annual report:

1. 1.0 kitchens are installed in each new dwelling

2. 1.9 bathrooms are installed in each new dwelling

3. In 93% of cases, all kitchen joinery is replaced during renovation

4. In 85% of renovations, all relevant joinery is replaced

5. Between 89% and 93% of kitchen cabinetry is locally produced

6. Between 70% and 80% of bathroom vanities are locally produced

In 2016, based on the above, the renovation of existing Australian dwellings, of all

types, used an estimated 142,806 m3 of joinery substrate.

The following data adopts the above averages of the number of renovations and the

earlier data on the volume of joinery substrate used in kitchens, bathrooms and

laundries, to provide an estimate of the amount of joinery substrate used in

renovations each year.

Table 9: Joinery substrate used in renovating Australian dwellings in 2016

Renovation Number

(Est. by HIA) Joinery Substrate/ Renovation (m3)

Implied Joinery Substrate (m3)

Renovated Kitchen* 145,401 0.723 105,145

Renovated Bathroom# 218,311 0.126 27,451

Renovated Laundry ^ 43,662 0.194 10,210

Total 142,806

Source: HIA & IndustryEdge


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It will be noted that the volume of joinery substrate used for each renovation type is

based on the Australian Standard House – a free-‐standing dwelling. While it is true

that the amount of joinery substrate used in other housing formats is less than in

free-‐standing dwellings, we have elected to retain the higher volume associated with

free-‐standing dwellings to take into account the volume of joinery substrate that

might be used in renovating other rooms in houses (eg. Wardrobes in bedrooms),

that is not otherwise captured here.


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Element 2: Consumption of joinery substrates in Australia

(Particleboard and MDF used in Australia)

Key Points for 2016 516,194 m3 of the Particleboard and Medium Density Fibreboard (MDF) consumed

in Australia in 2016 was used in household joinery, accounting for 85.3% of the

joinery substrate used in Australian dwellings. This was made up of:

• 364,529 m3 of particleboard (34% of total particleboard consumption of

1,069,690 m3)

• 151,665 m3 of MDF (23% of total MDF consumption of 653,730 m3)

This analysis is based on the following:

• Australia’s apparent consumption of particleboard and MDF in 2016 was

1,723,420 m3, (of which domestic production of particleboard and MDF

accounted for 88% of the total or 1,524,431 m3)

• Analysis demonstrating that 516,194 m3 (exactly 30.0%) of particleboard and

MDF consumed in Australia in 2016 was used as joinery substrate in Australian

dwellings. This is summarized below:

Fig. 5: Australian Particleboard and MDF Consumption by End-‐Use: 2016 (m3)

Source: ABS, EWPAA & IndustryEdge

Particleboard Flooring - Residential (249,351)

Particleboard Flooring - C&I (49,504)

Furniture (240,746)

Industrial (barriers, inc. sound) (252,052)

Merchants eg. Shelving (120,761)C&I Joinery (50,000)

Mouldings (117,671)

Doorskins (44,454)

Cabinet & Joinery Doors (86,292)

Other/Unknown (82,687)

Consumption to Household Joinery (429,902)


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The outputs of this analysis imply that 85.3% (516,194 m3) of the 605,466 m3 of

joinery substrate used in joinery in Australian dwellings, as demonstrated in

Element 1 of this analysis, was manufactured by cabinetmakers, joiners, builders

and others in Australia, in 2016. It therefore follows that the remaining 14.7% of

Australia’s household joinery is imported, ready to install. This amounts to

89,272 m3 of joinery substrate. This is equivalent to the joinery required for 37,789

free-‐standing houses.

The details of this analysis are provided below.

Apparent Consumption of Particleboard and MDF Panel products are those flat, wood material substrates used in panel form for a

wide range of applications, including in Australian housing. The main (not the only)

products are particleboard, medium density fibreboard (MDF) and to a much lesser

extent, plywood. In 2016, in total, Australia’s consumption of particleboard and MDF

was 1,723,420 m3.

In this context, panel products are the raw material from which secondary and

tertiary processors manufacture a wide variety of domestic and industrial products.

The most significant of these secondary processors are cabinetmakers, joiners,

furniture makers and home builders, the emphasis of all of whom is generally on

new dwelling construction and home renovation.

Although MDF and plywood (to a lesser extent) can be and are used in joinery

products in Australian dwellings, they are far less prevalent than particleboard.

In 2016, Australia consumed a total of 1,069,690 m3 of particleboard. Domestic

production dominated, as the table below shows, accounting for 89.1% of total

consumption, with imports accounting for 10.9%. Exports were, as ever, negligible.

In the same year, MDF consumption in Australia totaled 653,730 m3. Domestic

production dominated, accounting for 87.4% of total consumption. Imports

accounted for 12.9% and exports were again negligible.


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Table 10: Apparent consumption of Particleboard and MDF: 2016 (m3)

Source Particleboard (m3) MDF (m3) Total (m3)

Production 952,809 571,622 1,524,431

Less Exports 2,046 1,936 3,982

Plus Imports 118,927 84,044 202,971

Total 1,069,690 653,730 1,723,420

Source: ABS, EWPAA and IndustryEdge

Where Australia’s particleboard and MDF is used Australia’s total supplies of particleboard and MDF are deployed primarily (53.8%)

in housing applications. The analysis is provided below, followed by some more

detailed analysis of particleboard and MDF import data, showing how the analysis

was conducted.

57.4% of particleboard is used in households of which 34.1% is used in joinery The significant majority of particleboard, (57.4%), regardless of its provenance, is

used in Australian dwellings, both newly built and existing, for joinery and other

applications. Additionally, 10.3% of particleboard is estimated by industry to be

used in the manufacture of free-‐standing furniture each year.

Based on analysis of imports and production data, supported by industry feedback,

the estimated end-‐uses of Australia’s particleboard are set out in the table and chart

below. It shows that the residential use of particleboard, is dominated by joinery

products, as established in Element 1, supplemented by the large volume of

particleboard flooring deployed into Australian housing.

It is notable that Australian producers of particleboard reported widely different

proportions of their total particleboard production destined to joinery applications.

This was based primarily on production of melamine-‐skinned particleboard. The

range was a low of 17% through to a high of 55%.

It should also be noted that the table and chart below represent estimates, calculated

by IndustryEdge and informed from a range of inputs.


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Table 11: Particleboard by end-‐use: 2016 (m3)

m3 % Total Apparent Consumption 1,069,690

Detailed End-‐Uses Particleboard Flooring – Residential # 249,531 23.3 Particleboard Flooring -‐ C&I # 49,504 4.6 Furniture * 110,000 10.3 Industrial (barriers, inc. sound) 121,306 11.3 Merchants, Shelving etc 75,000 7.0 Joinery – C&I ^ 50,000 4.7 Other/Unknown 50,000 4.7 Joinery – Residential 364,529 34.1

Broad End-‐Use Categories Household/Residential 613,880 57.4 Commercial & Industrial 220,810 20.6 Furniture 110,000 10.3 Other/Unknown 125,000 11.7


# Analysis of production and import data, with separation to Residential v Commercial & Industrial based on industry input

* Estimated by Australian free-‐standing furniture manufacturers

^ Estimated by commercial joinery/cabinetmaker firms

Particleboard Flooring - Residential (23.3%)

Particleboard Flooring - C&I (4.6%)

Furniture (10.3%)

Industrial (barriers, inc. sound) (11.3%)Merchants/ Shelving (7.0%)

C&I Joinery (4.7%)

Other/Unknown (4.7%)

Consumption to Household Joinery (34.1%)


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23.2% of MDF is used in household joinery applications Based on industry advice, an estimated 50% of Australia’s total supplies of MDF are

used in household applications, with a further 20% estimated to be used in the

manufacture of furniture. While the former number may seem high at first glance,

more detailed analysis shows that the major applications of MDF are in mouldings,

doors for joinery applications and doorskins.

It will be noted that while 130,746 m3 of MDF was used in the manufacture of

Doorskins, Cabinet Doors and Draw Fronts, industry considers that only two-‐thirds

of this is relevant to joinery, with the remaining third being used in the manufacture

of general doors.

Just 10% or 65,373 m3 of MDF was used in the manufacture of joinery in 2016,

however, that figure rises to 23.2% or 151,665 m3 when the 86,292 m3 of MDF used

in Cabinet & Joinery Doors is included.

The table below sets out the estimated end-‐uses of MDF in Australia. It should be

noted that, as with the particleboard calculations, the table and chart below

represent estimates, calculated by IndustryEdge and informed from a range of

inputs.


26

Table 12: MDF by end-‐use: 2016 (m3)

m3 %

Total Apparent Consumption 653,730

Detailed End-‐Uses

Furniture* 130,746 20.0

Industrial (barriers, inc. sound) 130,746 20.0

Merchants, Shelving etc 45,761 7.0

Mouldings 117,671 18.0

Doorskins 44,454 6.3

Cabinet & Joinery Doors 86,292 13.2

Other/Unknown 32,687 5.0

Joinery – Residential^ 65,373 10.0

Joinery (Total, Including Doors)

Joinery – Residential + Cabinet & Joinery Doors 151,665 23.2

Broad End-‐Use Categories

Household/Residential 392,238 60.0

Commercial & Industrial 98,060 15.0

Furniture 98,060 15.0

Other/Unknown 65,373 10.0


27

Fig. 7: MDF by end-‐use: 2016 (m3)


# Analysis of production and import data, with separation to Residential v Commercial & Industrial based on

industry input

* Estimated by Australian free-‐standing furniture manufacturers

30% of total substrate was used to manufacture joinery in 2016 In total, of the 1,723,420 m3 of substrate consumed in Australia in 2016, an

estimated 30.0% or 516,194 m3 was used to manufacture Joinery for dwellings,

including Cabinet & Joinery Doors, accounting for 85.7% of the estimated 603,714

m3 of substrates used in residential joinery in 2016, as set out in Element 1 of this

analysis.

Of the total substrate consumption, an estimated 53.8% or 927,670 m3 was used in

household applications, with a further 14.0% or 240,746 m3 estimated to have been

used in the manufacture of furniture.

Furniture (130,746)

Industrial (130,746)

Merchants, shelving etc (45,761)Mouldings (117,671)

Doorskins (44,454)


Other (32,687)



28

These aggregates are set out in the table below.

Table 13: Aggregate substrate by end-‐use: 2016 (m3 & %)

Particleboard MDF Total %

Apparent Consumption 1,069,690 653,730 1,723,420 -‐

Detailed End-‐Uses

Particleboard Flooring – Residential #

249,531 -‐ 249,531 14.5

Particleboard Flooring -‐ C&I # 49,504 -‐ 49,504 2.9

Furniture * 110,000 130,746 240,746 14.0

Industrial (barriers, inc. sound) 121,306 130,746 252,052 14.6

Merchants, Shelving etc 75,000 45,761 120,761 7.0

Joinery – C&I ^ 50,000 50,000 2.9

Mouldings -‐ 117,671 117,671 6.8

Doorskins -‐ 44,454 44,454 2.6

Cabinet & Joinery Doors 86,292 86,292 5.0

Other/Unknown 50,000 32,687 82,687 4.8

Joinery – Residential 364,529 65,373 429,902 24.9

Residential Joinery Summary

Joinery – Residential + Cabinet & Joinery Doors

364,529 151,665 516,194 30.0

Broad End-‐Use Categories

Household/Residential 613,880 313,790 927,670 53.8

Commercial & Industrial 220,810 130,746 351,556 20.4

Furniture 110,000 130,746 240,746 14.0

Other/Unknown 125,000 78,448 203,448 11.8


29

Fig. 8: Aggregate substrate by end-‐use: 2016 (m3 & %)


# Analysis of production and import data, with separation to Residential v Commercial & Industrial based on industry input * Estimated by Australian free-‐standing furniture manufacturers ^ Estimated by commercial joinery/cabinetmaker firms

Exactly 30.0% or 516,194 m3 of the particleboard and MDF consumed in Australia

in 2016 is calculated to have been used in the manufacture of household joinery.

This equates to 85.3% of the 605,466 m3 of joinery calculated in Element 1 of this

analysis, to have been used in Australian dwellings in 2016, implying that 14.7% of

joinery used in Australian dwellings is imported, ready for installation.

In volume terms, this 14.7% amounts to imports of 89,272 m3 of substrate material,

equivalent to the joinery required for 37,789 free-‐standing dwellings.

The chart below shows total Australian joinery consumption, in 2016, by its

calculated broad end-‐use or destination.

Particleboard Flooring - Residential (249,351)

Particleboard Flooring - C&I (49,504)

Furniture (240,746)

Industrial (barriers, inc. sound) (252,052)

Merchants eg. Shelving (120,761)C&I Joinery (50,000)

Mouldings (117,671)

Doorskins (44,454)


Other/Unknown (82,687)



30

Fig. 9: Australian Joinery by Broad End-‐Use: 2016 (%)

Source: IndustryEdge

Net Trade – the Other Element of Apparent Consumption In addition to the dominant local production, there are small imports of both

Particleboard and MDF and even smaller exports of both that contribute to

Australia’s total consumption of joinery substrates.

Particleboard and MDF import data provides some guidance on end-‐uses Australian import data provides some guidance on the end-‐use applications of both

particleboard and MDF. This data was collated and preliminary analysis was checked

with import agents and major wholesalers (engaged in importing, as well as

distribution of domestically produced substrate).

Particleboard imports are 11% of total consumption In 2016, total imports of particleboard amounted to 118,927 m3 or 10.9% of

apparent consumption. Particleboard import data is broken down to indicate end-‐

use applications, at least broadly.

Of the total volume of imported particleboard, 15,533 m3 (13.1%) was melamine or

similarly surfaced. Further, the same data reported that 51,344 m3 (43.2%) was

particleboard in the form of Oriented Strand Board (OSB), Waferboard and non-‐

wood products.3 The largest volume, 52,050 m3 (43.8%) is other particleboard,

3 Typically the non-‐wood products particleboard are acoustic and similar end-‐use products manufactured from alternative fibres such as bamboo and sugar cane.

Household/Residential (53.8%)

Commercial & Industrial (20.4%)

Furniture (14.0%)

Other/Unknown (11.8%)


31

including raw and industrial product and a small quantity of flooring, according to

importers.

The relevant import codes and definitions are set out in the table below.

Table 14: Particleboard Import Codes by Type

Import Code Definition (abbreviated) 2016 Vol. (m3)

4410.11.00.02 Particleboard: Melamine surfaced 15,533

4410.11.00.05 Particleboard: Other 52,050

4410.12.00.06 OSB 29,446

4410.19.00.09 Other (of wood) eg. Waferboard 3,152

4410.90.00.25 Other (of other) 18,746

Source: ABS

For the purposes of this analysis, it has been assumed that all of the imports of

melamine or similar surfaced particleboard (4410.11.00.02) and 50% of the ‘Other’

particleboard (4410.11.00.05) are used in joinery applications. This data was joined

with the Australian industry’s confidential advice on the proportions of their

production that is, either Raw, Flooring or Melamine surfaced to build the calculated

estimates described earlier.

Particleboard imports, by country, are set out in the chart below, noting this includes

imports of both grades.


32

Fig. 10: Particleboard Imports by Country: 2016 (%)

Source: ABS

* NCD = no country details (all of which is raw board)

It can be observed that Asian countries are not significant suppliers of particleboard

to Australia.

MDF imports are 13% of total consumption In 2016, total imports of particleboard amounted to 84,044 m3 or 12.9% of

apparent consumption. MDF import data is also broken down to indicate end-‐use

applications, at least broadly.

For MDF, this data is focused on both the thickness of the material and also its

density, with both providing some indication as to end-‐uses.

The relevant import codes and definitions are set out in the table below, including

the general end-‐use.

Austria (9.8%)

China (2.3%)

Germany (1.8%)

Italy (6.6%)

New Zealand (27.1%)

NCD (17.0%)

Romania (3.0%)

South Africa (20.3%)

Thailand (4.1%)

Other (7.9%)


33

Table 15: MDF Import Codes by Type

Import Code Definition (abbreviated) & End-‐Use 2016 Vol. (m3)

4411.12.10.33 MDF of a thickness < 5 mm & density >0.8 grams per cubic centimetre ~ FURNITURE 1,192

4411.12.90.34 MDF of a thickness < 5 mm & density </= 0.8 grams per cubic centimetre ~ FURNITURE 3,690

4411.13.10.35 MDF of a thickness > 5mm but < 9mm & density > 0.8 grams per cubic centimetre ~ FURNITURE, JOINERY & OTHER

3,504

4411.13.90.37 MDF of a thickness > 5mm but < 9mm & density </= 0.8 grams per cubic centimetre ~ FURNITURE, JOINERY & OTHER

4,867

4411.14.10.38 MDF of a thickness > 9 mm & density > 0.8 grams per cubic centimetre ~ OTHER 19,691

4411.14.90.43 MDF > 9 mm thick & density </= 0.8 grams per cubic centimetre, not mechanically worked or surface covered ~ OTHER

6,149

4411.14.90.44 MDF > 9 mm thick & density </= 0.8 grams per cubic centimetre, mechanically worked or surface covered ~ JOINERY

44,951

Source: ABS

The import data was assembled and coupled with the confidentially supplied

domestic production data to build the calculated estimates described earlier.

MDF imports, by country, are set out in the chart below.


34

Fig. 11: MDF Imports by Country: 2016 (%)

Source: ABS

MDF imports by main grade are set out in the chart below.

Fig. 12: MDF Imports by Grade: 2016 (%)

Source: ABS

Belgium (2.0%)

China (45.2%)

Germany (4.7%)Italy (2.6%)

Malaysia (29.7%)

New Zealand (3.1%)

Switzerland (1.3%)Thailand (1.3%)

USA (2.0%)

Other (7.9%)

MDF >9mm >0.8 )

MDF >9mm <0.8

MDF >9mm >0.8

MDF >5mm, but <9mm

grams/cm (53.5%)

grams/cm (7.3%)

grams/cm (23.4%)

>0.8 grams/cm (5.8%)

MDF >5mm >0.8 grams/cm (4.2%)

MDF <5mm <0.8 grams/cm (4.4%)MDF <5mm >0.8

grams/cm (1.4%)


35

Exports of Particleboard and MDF are negligible Although relevant to assessing total Australian consumption of both Particleboard

and MDF, exports from Australia are negligible. In 2016, exports of Particleboard

totaled just 2,046 m3 (0.2% of total production) and exports of MDF totaled just

1,936 m3 (0.3% of total production).


36

Element 3: Imports of joinery The third element in the analysis of joinery products imported into Australia is the

examination of the import data itself.

Ideally, import data would specify exactly what the product is, what it is used for and

the volume or number of items, as well as the price per unit. In practice however, as

with most countries, Australia’s import data, reflected in the Harmonised Tariff Item

Statistical Code (HTISC)4 is often of limited utility, for certain products at least. This

is particularly the case for more elaborately transformed goods, such as joinery and

related furniture products.

There are two primary constraints with the relevant import data. The first is that the

data does not specify end-‐uses and accordingly, the products included under certain

import codes could be any of a wide range of items. The second constraint is that in

general, the relevant products are reported by number of items (as opposed to by

volume of material) or only by value, meaning volume often cannot be calculated.

The result is that it is very difficult to accurately identify details related specifically

to imports of joinery products. There is no code which records specifically, for

example, ‘Flat packed kitchen cabinetry’.

In consequence, to develop a consistent estimate of the volume, number and price of

joinery product imports, a forensic and systematic approach is required.

The approach used in this case involves:

a. Identifying the relevant import codes

b. Devising a set of ‘rules’ or ‘assumptions’ for analyzing the data

c. Analyzing the import data

d. Calculating the total volume and/or value of imports.

4 For further details on the HTISC, go to http://www.abs.gov.au/ausstats/[email protected]/0/8DF2F05EE6BCF565CA256A5B001BD78A


37

Determining relevant import codes There are only a relatively small number of import codes under which ‘joinery’ in

any form can be imported. Unfortunately, these codes do not distinguish the precise

nature of the product being imported, its end-‐use or the form (assembled or flat

pack) in which it is imported.

Based on input from industry and professional knowledge, the following import

codes have been examined to determine the extent to which they may contain

records of imported joinery and relevant products. Those marked in bold have been

assessed to be of particular relevance.

It is notable that joinery items could be imported under several codes, included

within Chapter 94 – Furniture (and other) of the HTISC. Ultimately, only a small

number of codes were determined as directly relevant to imports of joinery.

However, useful additional information was gleaned about the amount of furniture

(and therefore of materials including Particleboard and MDF) that is imported into

Australia.

A small number of codes under Chapter 44 – Wood and articles of wood were also

examined to determine if they were relevant. Within Chapter 44, joinery items are, if

at all, most likely to be imported as Builders’ Joinery (4418), which includes a

number of sub-‐codes that are not relevant, with respect to joinery.5

Those import codes that were examined because they may be relevant, are detailed

below. It will be noted that the only code for which there is a high degree of certainty

is that for Wooden Kitchen Furniture (9403.40.00.24).

5 Sub-‐codes under 4418 deemed not to be relevant included: 4418.10 -‐ Windows, 4418.20 -‐ Doors (exterior and interior), 4418.60 – Posts & Beams.


38

Table 16: Import Codes Examined in Detail

Import Code Descriptor Assessment

4418.90.00.376

Builders joinery and carpentry of wood (incl. cellular panels) (excl. windows and their frames; doors, their frames and thresholds; shuttering for concrete constructional work; shingles and shakes; etc)

May include some joinery, but industry feedback is this is LIKELY TO BE LIMITED

4421.90.00.307

Articles of wood, nes (excl. wooden articles previously separately identified in this chapter and wooden articles of furniture falling in HS Chapter 94)

Any other wood products. This is a ‘catch-‐all’ grade and can include any product not elsewhere specified, including joinery products ~ LIKELY TO BE LIMITED

9403.30.00.418 Wooden furniture of a kind used in offices Unlikely to be relevant to residential joinery

9403.40.00.24 Wooden furniture, of a kind used in the kitchen

Includes cabinetry carcasses, including flat packed, as well as kitchen furniture for caravans and vans

9403.50.00.23 Wooden bedroom furniture

Unlikely to be relevant as Customs Agents advise built-‐in wardrobe furniture is a builder’s joinery product

9403.60.00.25 Wooden outdoor furniture Unlikely to be relevant to joinery

9403.60.00.26 Wooden coffee tables, nests of tables and similar wooden furniture

Unlikely to be relevant to joinery

9403.60.00.279 Wooden buffets, sideboards, wall units and similar wooden furniture


9403.60.00.28 Wooden dining tables (excl. kitchen tables) Unlikely to be relevant to joinery

9403.60.00.29 Wooden tables (excl. kitchen, dining and coffee tables or nests of tables and similar wooden furniture)


9403.60.00.42

Wooden furniture (excl of a kind used in offices, kitchens, bedrooms & outdoor furniture, coffee/dining/nests of tables, buffets, sideboards, wall units)

Relevant because may include some bathroom vanities

9406.00.00.24 Prefabricated buildings Unlikely to be relevant

Source: ABS, Australian Customs & Border Protection Service & IndustryEdge

6 Code was amended with effect from 1st January 2017. Two new codes were created – 4418.91.00.42 and 4418.99.00.43 7 Code was amended with effect from 1st January 2017. Two new codes were created – 4421.91.00.20 and 4421.99.00.21 8 Customs agents and importers report that almost all imports under 9403.30.00.41 are imported as flat packs. Although not pertinent to joinery imports, this is useful additional information. 9 Furniture manufacturers report they experience an estimated 90% of imports under 9403.60.00.27 are imported as flat-‐pack and that 80% of the material used is Particleboard, 15% is MDF and 15% is solid wood. Although not pertinent to joinery imports, this is useful additional information.


39

While the four import codes indicated in bold are likely to be those reporting the

largest volume of imported joinery products, it is important to note that it is likely

imports have been recorded against at least some of the other codes.

Misclassifications are less likely for specific codes designated by type of room (eg.

9403.50.00.23 – Wooden Bedroom Furniture) and more likely to be those that that

are generic and associated with the substrate. That is, for instance, it is more likely

that particleboard laundry cupboards would be misclassified by volume as

Particleboard, than as Wooden Bedroom Furniture.

As the analysis in Element 1 indicates, the significant majority of joinery used in

residential dwellings is contained in kitchens, wardrobes and other cupboards,

followed by bathrooms and laundries.

Assumptions to drive import data analysis Because of the data constraints, it is necessary to refine the import data by applying

some widely understood principles or rules that can be used as assumptions.

Based on publicly available data (described below), the following assumptions have

been applied as rules to refine the import data. It should be noted that these

assumptions have greater utility and application where the number of units is

identified in the import data.


40

Table 17: Operating Assumptions for Import Analysis

No. Assumption Source Implication for Data Analysis

1 Min. import price of kitchen joinery is AUDFob55/unit*, based on estimated minimum retail price of AUD65/unit

Online10 Remove imports <AUDFob55/unit

2 Max. wholesale price of joinery is AUDFob750/unit*, based on estimated maximum retail price of AUDFob936/unit

Online11 Remove imports >AUDFob750/unit

3 Min. number of units is 10 per shipment IndustryEdge Remove imports where <10 items

4 Flat pack joinery will be imported by SEA Industry Remove imports by ‘AIR’ or ‘POST’

5 Reported average AUDFob/unit prices are 50% of the retail price

IndustryEdge Allows cross-‐check with retail pricing


* Unit is considered to represent a single ‘carcass’, where a kitchen (in particular) or other joinery item may be made up of multiple joinery items

The result of applying these assumptions is inevitably that the volume (and total

value) of imports is reduced, by removing the ‘outliers’ in the data.

Originally, IndustryEdge proposed to remove imports from a range of advanced

economies, including but not limited to Japan, Germany and the USA. However,

industry advice was that these should be retained, but be identifiable for further

analysis, should that be required.

Analysis of relevant imports The following sets out the analysis of each of the four identified import codes that

are likely to include joinery products. Although none is so complete and precise as to

point to an exact volume of joinery imports for the reasons set out earlier, combined,

they represent a reasonable and consistent estimate for further consideration.

10 Ikea, 2017 IKEA Catalogue, sourced, April 2017 11 Kaboodle, http://www.kaboodle.com.au, sourced, April 2017


41

Imports of ‘Wooden Kitchen Furniture’ (9403.40.00.24) In 2016, there were wooden kitchen furniture imports delivered into all states and

territories, other than the ACT. Industry and import agent advice is that this code is

used for imports of kitchen cabinets, and almost nothing else, with the exception of

some benchtops. It includes both large and small cabinets that are flat pack and any

(a small number) that may be pre-‐assembled. It also includes imports that come

with and without doors.

As the following graphic shows, just as kitchens come in many shapes and sizes, so

too do the cabinets that are used to manufacture a kitchen.

Fig. 13: Examples of Variations in Kitchen Cabinets

Source: Tradepax

The implication of this evident variation in the size of kitchen cabinets is that

average import data requires some further refinement to be more precise as a

measure of volume (and value) of joinery imports. The assumptions set out earlier

remove items that are likely to be lower-‐priced components associated with

kitchens as well as very small volumes and very high-‐priced items that are likely to

be bespoke and may have been imported for a single dwelling.


42

Based on the import data and an internet search, in addition to items priced above

AUDFob750/unit, kitchen furniture items priced below AUDFob55/unit have also

been excluded. Although there is a small quantity of standard kitchen furniture

carcasses available below this price, many other items are also available at this price.

This includes componentry, and special items such as bench inserts, timber fascias

and so on.

After the application of the assumptions, the calculations show that there were

268,390 items imported in 2016, at an average price of AUDFob142.29. The median

of these prices, after the application of the assumptions, was a marginally higher

AUDFob157.92/unit, meaning half the imports are priced below and above this

point.

Importantly, industry advised that this import code also includes kitchen joinery

imported for the caravan and van industry. An analysis of this market is included in

Element 4.

The role of major retailers in the importation of kitchen joinery cannot be

overlooked. An analysis of this sector, based on limited data, is included later in this

section.

The table below shows the key data for this code, both prior to and after the

application of the assumptions.


43

Table 18: Wooden Kitchen Furniture Imports – Key Data: 2016

Original After Application of Assumptions

Items (No.) 477,923 268,390

% by Sea 100% 100%

Value (AUDFob) $73,631,497 $38,188,602

Highest price (AUDFob/Unit) $999.72 $740.41

Average price -‐ Mean (AUDFob/Unit) $239.29 $142.29

Average price – Median (AUDFob/Unit) $174.19 $157.92

Lowest price (AUDFob/Unit) $24.41 $50.41

Source: ABS & IndustryEdge

Taking the adjusted 268,390 units and dividing that by the nine (9) cabinets

included in kitchens in the HIA’s Standard House (see Element 1), implies that

29,821 kitchens (assuming all are free-‐standing dwellings) were supplied by imports

in 2016. This is equivalent to a minimum 8.0% of all kitchen cabinets being supplied

by imports.

It is important to note that this is a conservative methodology and calculation, and

the number of dwellings supplied with kitchens by imported joinery will be higher.

This is because it is estimated that the 48.8% of dwelling commencements in 2016

that were not free-‐standing houses contain smaller kitchens, on average, than free-‐

standing houses. This is further supported by kitchen cabinetmakers who report

that a significant volume of imported kitchens are imported in large numbers, for

multi-‐storey apartment buildings.

The table below sets out the method used to calculate the proportion of total kitchen

cabinets that was imported in 2016.


44

Table 19: Calculating import proportion of total kitchen cabinets: 2016

Measure (2016) Number / %

Kitchens installed (number) * 372,142

Estimated cabinets per kitchen (number) 9

Total kitchen cabinets installed (number) 3,349,278

Wooden kitchen furniture imports (units) 268,390

Proportion of imports (%) 8.0%


* As set out in Table 8 and including new and renovated kitchens

Multiplying the weighted average volume of substrate demonstrated in Element 112,

to be used in Australian kitchens (0.0670 m3 in total, made up of 0.0503 m3 of

carcass material [Particleboard] and 0.0166 m3 of door material [MDF]) by the

number of kitchen joinery units contained in that Standard Kitchen indicates that the

268,390 imported wooden kitchen furniture items used an estimated 13,509 m3 of

particleboard and 4,469 m3 of MDF. This sums to a minimum 17,977 m3 of joinery

substrate imported as wooden kitchen furniture in 2016.

This is a complex derived calculation, which is therefore set out below.

Table 20: Derived Substrate Used in Imported Wooden Kitchen Furniture

Units: 2016 (Number & m3)

Carcass

(Particleboard) m3

Doors (MDF) m3

Total m3

Weighted Average Substrate Use per Unit* 0.0503 0.0166 .0.0670

Number of imported wooden kitchen furniture units 268,390

Total (m3) 13,509 4,469 17,977


* Derived from Table 4 and detailed in full in Appendix Four

12 Analysis conducted for FWPA, by Davis Langdon & Associates, based on the HIA’s Standard House


45

Further support for this analysis, and its outcomes, is derived by calculating the total

nominal cost of a kitchen for a Standard House, using the following methodology.

Multiplying the average price – after the application of the assumptions – by the

number of units installed in the Standard House (nine), the average price of an

imported kitchen would therefore be AUDFob1,280.61. Applying the consistent

doubling of the import price to the consumer purchase price suggests the average

price per unit would be AUD284.58, and for a full kitchen, AUD2,561.22 (plus GST

where applicable). Feedback from a kitchen installer, and analysis of websites,

including for Bunnings Warehouse indicate this price is within expectations. For

example, the lowest priced Bunnings kitchen package was AUD798 (inc. GST).

Wooden Kitchen Furniture Import Details The following charts display the adjusted imports of wooden kitchen furniture in

2016, by State of Delivery and by Country of Origin.

The first chart shows that imports of kitchen furniture were dominated by supplies

to Victoria and New South Wales, but with a particular bias to Victoria in 2016,

where apartment building activity was at its strongest. Also notable is that

shipments to Western Australia – which is closer to Asia – were third highest, edging

the third most populous state, Queensland from that position.


46

Fig. 14: Wooden Kitchen Furniture Imports by State: 2016 (Units & AUDFob/unit)

Source: IndustryEdge, based on ABS data

Note: Data amended as per assumptions

The chart below shows that regardless of the destination within Australia, the

monthly average price of kitchen furniture imports is relatively stable, while

occasional price movements in some jurisdictions have a noticeably larger effect

than other jurisdictions.

Jan-

2016

Feb-

2016

Mar

-201

6

Apr-2

016

May

-201

6

Jun-

2016

Jul-2

019

Aug-2

016

Sep-2

016

Oct

-201

6

Nov

-201

9

Dec

-201

6

0

5,000

10,000

15,000

20,000

25,000

30,000

0

50

100

150

200

250

300

Units

AU

DFob

/unit

Month

NSW

Vic

Qld

SA

WA

Tas

NT

TWA


47

Fig. 15: Wooden Kitchen Furniture Imports by State: 2016 (AUDFob/unit)



Although it almost needs no mention, the chart below confirms that China is by far

the major source of Australia’s imported kitchen furniture items. Of interest is that

the only other positions of note are held by European nations.

Jan-

2016

Feb-

2016

Mar

-201

6

Apr-2

016

May

-201

6

Jun-

2016

Jul-2

019

Aug-2

016

Sep-2

016

Oct

-201

6

Nov

-201

6

Dec

-201

6

0

50

100

150

200

250

300

350

400

450

500

Month

NSW

Vic

Qld

SA

WA

TWA


48

Fig. 16: Wooden Kitchen Furniture Imports by Country: 2016

(Units & AUDFob/unit)



Import data often presents challenges to perceptions. The chart below shows that

despite the dominance of China’s supplier position, supplies of kitchen furniture

from Italy are regularly, and even Germany in one instance, are lower priced than

the Chinese and average prices for the month. This points to the products being

largely uniform in price, and likely, being largely uniform in type, as one would

expect of different sized kitchen carcasses.

Jan-

2016

Feb-

2016

Mar

-201

6

Apr-2

016

May

-201

6

Jun-

2016

Jul-2

019

Aug-2

016

Sep-2

016

Oct

-201

6

Nov

-201

6

Dec

-201

6

0

5,000

10,000

15,000

20,000

25,000

30,000

0

50

100

150

200

250

300

Unit

AU

DFob

/unit

Month

China

Germany

Italy

Vietnam

Other

TWA


49

Fig. 17: Wooden Kitchen Furniture Imports by Country: 2016 (AUDFob/unit)



Imports of ‘Other Wooden Furniture’ (9403.60.00.42) Unlike the relatively tightly defined ‘Wooden kitchen furniture’ and most of the

other furniture classifications, which are discrete (eg. Wooden dining tables -‐

9403.60.00.28), the ‘Other’ import code necessarily includes a wider range of items.

It is therefore far more difficult to analyse.

The descriptor for the code, shown below, indicates it is used to record imports that

exclude everything else in the other codes detailing wooden furniture imports.

B BB

B

B

B

B

B

B

BB

B

J

J

J

J

J

J

J

J

J

J

H

H H

H

H

H

H H H

H

HH

F

F

FF

FF

FF

F

FF

F

Jan-

2016

Feb-

2016

Mar

-201

6

Apr-2

016

May

-201

6

Jun-

2016

Jul-2

019

Aug-2

016

Sep-2

016

Oct

-201

6

Nov

-201

6

Dec

-201

6

0

100

200

300

400

500

600

AU

DFo

b/u

nit

Month

B China

J Germany

H Italy

F Vietnam

TWA


50

9403.60.00.42

Other Wooden Furniture, Other

Wooden furniture (excluding of a kind used in offices, kitchens, bedrooms &

outdoor furniture, coffee/dining/nests of tables, buffets, sideboards, wall

units)

Source: ABS

The exclusions in the descriptor are important, and provide considerable guidance

about what is not included in this code.

Interviews with Customs Agents advise that this code (9403.60.00.42) would be

expected to include items including (but not limited to):

• wardrobe and built-‐in shelving componentry

• bathroom and laundry vanities

• wooden furniture fixtures (eg. Cupboard door handles)

• wooden furniture components

• free-‐standing furniture items, including mixed use items such as

television/media centres

• shelving units

• semi-‐decorative items such as coat stands

Customs Agents also advised that a small number of these items could be recorded

as ‘Other articles of wood’ under the sub-‐code 4421.90.00.30.

Unlike the Wooden kitchen furniture items, it was determined there was no utility in

adjusting the data for a series of industry assumptions. Analysis has been conducted

on the entirety of imports.

As the data below shows, of the 5,280,605 items imported in 2016, almost 97% were

valued at or below AUDFob150.00/item, and three-‐quarters were valued less than

AUDFob65/item.

We consider that the import data demonstrates the accuracy of the industry advice

and that the vast bulk of imports under this code are small components, small


51

wooden fixtures and potentially decorative items capable of being classified as

furniture. However, it is also expected to include, among the higher value items, a

relatively small quantity of bathroom vanities, laundry cupboards and other

cupboards and wardrobes.

Table 21: Other Wooden Furniture Imports – Key Data: 2016

Items (No.) 5,280,605

% by Sea 100%

Value & Price

Value (AUDFob) $285,261,314

Highest price (AUDFob/Unit) $497.70

Average price -‐ Mean (AUDFob/Unit) $127.29

Average price – Median (AUDFob/Unit) $103.59

Lowest price (AUDFob/Unit) $3.29

Number

Largest recorded units 60,162

Average recorded -‐ Mean (Units) 1,846

Average recorded – Median (Units) 148

Smallest recorded units 10

Analysis

Number of units priced >AUDFob127.29 269,365

Proportion of total imports 5.1%

50% assumed to be joinery 135,000

Average joinery dimensions 1100 x 400 x 900

Implied joinery substrate 7,673 m3



52

The chart below places the data into stark relief, demonstrating that in 2016, three-‐

quarters of Other Wooden Furniture imports cost less than AUDFob65/unit,

indicating that few, if any of those items are joinery products.

Fig. 18: Imports of Other Wooden Furniture by Price: 2016 (AUDFob/item)


Note: Data cleansed to remove outliers as described in Assumptions

To add further to this analysis, import volumes and prices have been calculated on

both a mean and a median basis. The mean and median data demonstrate that

although there are a small number of very large shipments that increase the average

number of units shipped, the majority of shipments are less than one tenth the size

of the average shipment. The average price is more uniform, with the median price

being just 18.6% lower than the average price.

100<150(8.0%)

Fob 0<150(7.9%)

150<200 (1.5%)

200<250 (1.1%)

>250 (0.5%)

15<65 (66.6%)

100<150 (14.4%)


53

Table 22: Analysis of Other Wooden Furniture Imports

Volume (No. of items) Price (AUDFob/item)

Mean Average 1,846 127.29

Median* 148 103.59

Source: ABS

Although not conclusive, this analysis points to the items imported as Other Wooden

Furniture being more similar than dissimilar, at least with respect to price.

The number of imported units above the average price of AUDFob127.29 accounted

for just 5.1% of total imports or 269,365 items.

Applying the standing assumption that the Free on Board price is on average 50% of

the retail price, implies that the average retail price of Other Wooden Furniture

imports is approximately AUD250/unit.

A search of import, wholesale and retail prices was undertaken, to determine what, if

any, joinery products (or products manufactured from joinery substrates) might be

included under this import code, at above the mean price of AUDFob127.29/unit

(import) or above the nominal mean retail price of AUD250/unit.

It was observed that wooden bathroom vanities can be purchased for as little as

AUD179/unit13 and laundry vanities from as little as AUD115/unit, but are generally

priced closer to AUD300/unit14.

On the basis set out above, it has been assumed that approximately half of the

269,365 imported items priced above AUDFob127.29 are joinery items, including

bathroom and laundry vanities. That amounts to approximately 135,000 imported

units in 2016, of a size and material composition unlikely to be greater than that of a

standard bathroom vanity (1100 x 400 x 900), or a standard laundry cupboard

(1200 x 600 x 900), and only marginally larger than the standard ensuite vanity (850

x 350 x 900).

13 House of Home ~ https://www.houseofhome.com.au/s/bathroom-‐vanities 14 Bunnings Warehouse ~ https://www.bunnings.com.au/our-‐range/storage-‐cleaning/laundry/modular/cabinets


54

In 2016, if approximately 135,000 units were imported under this classification, at

an average dimension of 1100 x 400 x 900 and each requires 0.057 m3 of joinery

substrate (primarily particleboard), the total volume of imported joinery substrate is

7,673 m3.

Throughout the processes of this research, under questioning, importers, customs

agents and industry participants advised that the cheaper products in this category

could be components of wooden furniture, especially joinery, and especially

drawers. If that is the case, the volume of joinery and of particleboard and MDF

imported under this code would be significantly higher than set out above.

The following charts show imports of other wooden furniture by state, indicating

that both volumes and prices are relatively stable, and that imports are strongest

into New South Wales.

Fig. 19: Other Wooden Furniture Imports by State: 2016

(Units & AUDFob/unit)



Jan-

2016

Feb-

2016

Mar

-201

6

Apr-2

016

May

-201

6

Jun-

2016

Jul-2

019

Aug-2

016

Sep-2

016

Oct

-201

6

Nov

-201

6

Dec

-201

6

0

100,000

200,000

300,000

400,000

500,000

600,000

0

10

20

30

40

50

60

70

Units

AU

DFob

/unit

Monyh

NSW

Vic

Qld

SA

WA

Tas

NT

TWA


55

Fig. 20: Other Wooden Furniture Imports by State: 2016 (AUDFob/unit)

Source: IndustryEdge, based on ABS data Note: Data amended as per assumptions

Fig. 21: Other Wooden Furniture Imports by Country: 2016 (Units & AUDFob/unit)


Jan-

2016

Feb-

2016

Mar

-201

6

Apr-2

016

May

-201

6

Jun-

2016

Jul-2

019

Aug-2

016

Sep-2

016

Oct

-201

6

Nov

-201

6

Dec

-201

6

20

30

40

50

60

70

80

90

100

110

120A

UD

Fo

b/u

nit

Month

NSW

Vic

Qld

SA

WA

Tas

TWA

Jan-

2016

Feb-

2016

Mar

-201

6

Apr-2

016

May

-201

6

Jun-

2016

Jul-2

019

Aug-2

016

Sep-2

016

Oct

-201

6

Nov

-201

6

Dec

-201

6

0

100,000

200,000

300,000

400,000

500,000

600,000

0

10

20

30

40

50

60

70

Units

AU

DFo

b/u

nit

Month

China/HK

Indonesia

Italy

Malaysia

Vietnam

Other

TWA


56

Fig. 22: Other Wooden Furniture Imports by Country: 2016 (AUDFob/unit)


Imports of ‘Builders’ Joinery’ (4418.90.00.37) This particular sub-‐code is the ‘catch-‐all’ for the broader classification grouping

defined as follows:

4418 Builders’ Joinery and Carpentry of Wood, Including Cellular Wood

Panels, Assembled Flooring Panels, Shingles and Shakes

The products specified under this broad import code heading are windows, doors,

shutters (include pre-‐assembled concrete formwork), posts and beams and flooring

panels.

Customs Agents confirm that it is, as described above, feasible to include products

such as pre-‐drilled wardrobe inserts under this sub-‐code, but properly, only if

assembled.

Because this import code records only the value of imports (it does not record the

number of items imported), further analysis is not possible. However, it is also

important to note that this volume is highly unlikely to include flat-‐pack furniture

for residential dwellings.

B

B

B BB

BB

BB

B

BB

J

J

J

J

J

J

J

J

J

J

J J

H

H

H

H

HH H

H

H

HH

H

F F F FF F

FF F F F

F

Ñ Ñ

Ñ

ÑÑ Ñ

Ñ

Ñ

Ñ

ÑÑ

Jan-

2016

Feb-

2016

Mar

-201

6

Apr-2

016

May

-201

6

Jun-

2016

Jul-2

019

Aug-2

016

Sep-2

016

Oct

-201

6

Nov

-201

6

Dec

-201

6

0

20

40

60

80

100

120

140

160

180

AU

DFob

/unit

B China/HK

J Indonesia

H Italy

F Malaysia

Ñ Vietnam

TWA


57

The aggregate details provided below are supplied for comparative purposes.

Table 23: Analysis of Selected Builders’ Joinery Imports

4418.90.00.37 2016

Number of Items Not recorded

Value of Imports AUD308,796,184

Source: ABS

Imports of ‘Other Wood Products’ (4421.90.00.30) This particular sub-‐code is the ‘catch-‐all’ for the broader grouping defined as

follows:

4421 Other Articles of Wood

There are no specific products specified under this broad import code heading,

which aims to capture other items of wood.

Customs Agents confirmed that there were no household joinery or furniture items

they would expect to see recorded under this code. However, an importer advised

that some joinery product componentry could be recorded under this code.

Because this import sub-‐code records only the value of imports (it does not record

the number of items imported), further analysis is not possible. However, it is also

important to note that this volume is highly unlikely to include flat-‐pack furniture

for residential dwellings.

The aggregate details provided below are supplied for comparative purposes.

Table 24: Analysis of Other Articles of Wood Imports

4421.90.00.30 2016

Number of Items Not recorded

Value of Imports AUD359,613,117

Source: ABS


58

Minimum volume of imported joinery Because of the import data limitations, it is not possible to determine the actual

volume of imported flat-‐pack residential joinery. It is possible to discern a minimum

volume of imports of flat-‐pack joinery, by applying the assumptions set out in this

analysis.

The minimum identifiable volume of imports, based on the analysis described above,

is 25,650 m3, made up of a minimum 17,977 m3 of kitchen joinery and a minimum

7,673 m3 of joinery related to bathrooms, laundries, other wardrobes and

cupboards.

This is the minimum volume of joinery being imported because the assumptions

used are conservative and limited to imports under just two import sub-‐codes.

It must be noted that this model of estimating the minimum volume of joinery

imports is based on a series of assumptions. Future refinements will provide a basis

to make more reliable estimates, however, this assessment model can be repeated

by following the detailed methodology set out in Appendix 2.

Cost, parallel imports and commodification Throughout the research for this analysis, it was stated that the primary driver for

imports is that imports are cheaper to procure than domestically produced

equivalents.

One kitchen cabinetmaker advised that they manufacture kitchens in Australia for

free-‐standing houses and better townhouses and import kitchens for developers and

commercial and industrial buildings because the developers and project managers

are focused solely on price and not on quality.15 There is no conclusive evidence, but

it appears that this auto-‐cannibalising form of parallel importation is a significant

feature in the industry.

Albeit that the imports have been adjusted to remove ‘outliers’, the price data is

surprisingly uniform and largely moves consistently. The implication of this is that

wooden joinery imports – particularly for kitchen furniture – are approaching

commodity status. They are certainly freely traded.

15 Confidential interview – March 2017


59

This suggests that driven by price considerations, imports of particleboard and MDF

joinery, especially for kitchens, will continue to grow in coming years.


60

Element 4 – Cross Checking Data Because this analysis seeks to assess the amount of joinery that is being imported by

using a group of measures, rather than a single measure, it is very useful, necessary

even, to consider other and related data that is either consistent with, or contradicts

the findings of the research.

7% of HIA members report their kitchen cabinetry is imported – Consistent with

analysis

Consistent with the majority of HIA members (72% of respondents) engaged in the

kitchen and bathroom sectors preferring to use domestically produced goods, they

also reported that 89% of their kitchen cabinetry is domestically produced.16

It should be noted the same cohort reported 67% of their bench tops are

domestically produced, but no specification was requested as to what those bench

tops were made from.

Kitchen cabinetmakers estimate up to 10% of kitchen cabinetry is imported –

Consistent with analysis

Although their estimates varied, kitchen cabinetmakers interviewed for this analysis

(not the same cohort surveyed by the HIA) advised that up to 10% of kitchen

cabinetry is imported. Without exception they considered the imports were focused

on ‘projects’ or ‘apartments’, rather than free-‐standing houses.

If that holds true -‐ there is a logic to it -‐ the volume of imported joinery will be less

than the 10% estimate, because other housing formats include less joinery than free-‐

standing dwellings.

23% of HIA members report their bathroom vanity units are imported –

Inconsistent with analysis

Different to their reports with respect to kitchens, 23% of HIA members report that

the bathroom vanities they install in bathrooms (including ensuites) are imported.17

16 HIA-‐GWA Kitchens and Bathrooms Report, 2016-‐17, page 34 17 HIA-‐GWA Kitchens and Bathrooms Report, 2016-‐17, page 47


61

As set out in Element 3, it is difficult to identify these items of wooden furniture in

the trade data.

Kitchen cabinetmakers report 14.5% higher volume of joinery substrate used in

kitchens – Consistent with, but higher than analysis

According to kitchen cabinetmakers interviewed for this analysis, the average

consumption of joinery substrates in kitchens manufactured in 2016 was 0.8460

m3. This estimate is an acceptable 14.5% higher than the 0.7231 m3 estimated by

analysis of the Standard House, set out above.

Multiplied by the 372,142 new and renovated kitchens estimated to have been

manufactured in Australia in 2016, the estimated consumption of joinery substrate

in 2016 was 314,828 m3, just 14.5% higher than that calculated by analysis of the

standard house.

This assessment was undertaken as a further check on joinery substrate

consumption assessments undertaken using the Standard House and described

earlier. The survey sample is indicative rather than statistically reliable and could

include upwards bias.

Kitchen cabinetmakers responsible for an estimated 2.0% of all kitchens

manufactured in 2016 were surveyed – primarily by phone – on recommendation

from industry associations18 and IndustryEdge’s direct contacts.

The survey respondents did not include companies whose sole business lines are

importation of joinery, where it is anticipated the average size of kitchens and the

amount of particleboard and MDF in them is less than in a domestically

manufactured kitchen.

Recreational vehicles used 15,791 m3 of joinery in 2016 – Implies consumption

and imports may be higher than the minimum volume identified in the analysis

suggests

18 Furnishing Industry Association of Australia (FIAA) and Engineered Wood Products Association of Australasia (EWPAA)


62

In 2016, there were 21,841 recreational vehicles manufactured in Australia, the

second largest manufacturing year since 197919. At the suggestion of a senior and

experienced import and wood products market participant, this information was

further interrogated, because of the extent to which joinery is used to ensure space

utilization is maximized.

Cabinetmakers considered that on average, caravans, vans and recreational vehicles

utilized approximately one-‐third the average amount of joinery found in the kitchen

of the Standard Australian House.

That is equivalent to 0.723 m3 of joinery substrate (particleboard and MDF),

inclusive of doors. In total, for the 21,841 recreational vehicles manufactured in

2016, this amounts to 15,791 m3 of joinery substrates.

Industry experts advised that at least one significant manufacturer of recreational

vehicles imports their joinery from Germany, supplies from which are observable in

the wooden kitchen furniture import data, set out in Element 3.

19 Caravan Industry Association of Australia, 2016, http://www.caravanindustry.com.au/caravan-‐and-‐camping-‐state-‐of-‐industry-‐2017


63

Retailers are large importers of kitchen joinery – but how much remains unclear

It is widely reported, and easily observed in store, in catalogues and online, that

major retail chains, including Bunnings and IKEA, are engaged in the importation of

joinery, especially for kitchens and particularly for renovations.

It is noted that there is no clearly available data on the quantity or value of kitchen

imports or sales by major retailers.

However, large cabinetmaking and joinery businesses estimate major retailers sell

cabinets accounting for as much as 15% of the total renovation market. This

estimate is based on the number of stores of the major retailers engaged in kitchen

sales and an informed estimate of their annual sales. This is set out in the table

below.

Table 25: Selected Retailer Kitchen Sales Analysis

Bunnings IKEA

Number of stores 248* 10

Estimated kitchen ‘sales’ per store (annual) 150 250

Estimated total kitchen ‘sales’ per annum 37,200 2,500

Implied number of joinery ‘items’ if ‘full kitchen’ of 9 units of joinery sold (Element 1) 334,800 22,500

Total kitchen cabinets installed in renovations in 2016) (Element 1) 1,308,609

Major retailer implied market share 25.6% 1.8%

Source: IndustryEdge * Warehouses – not other sites20

The HIA’s assessment is that there were 145,401 kitchen renovations in 2016 and

that 93% of these involved full kitchen replacements. If that is the case and the

average nine kitchen cabinets was replaced in each instance, the 15% for which

major retailers reportedly account would total 21,810 kitchens or 196,219 items of

kitchen cabinetry.

In turn, this amounts to an unlikely 73.1% of all imported kitchen joinery items

(after adjustment for assumptions) for 2016. This is unlikely and expected to be

20 Bunnings, 2017, https://www.bunnings.com.au/about-‐us


64

lower because it is understood that imports have played a substantial role in

supplying multi-‐storey apartments and other developer building projects, as well as

the joinery for caravans and vans (among other items). Additionally, imported flat-‐

pack kitchens are readily available from a wide range of other sources.

What the data suggests is that major retailers may be supplying more than 15% of

total units of cabinetry, including joinery, and including some complete kitchens, in

addition to individual units of joinery.

This includes the expectation that retailers are more likely to have strong positions

in partial renovations (where less cabinetry units are installed), particularly where

building permits and plumbing or electrical work are less likely to be required.


65

Appendix One -‐ Glossary of names, terms and definitions • ABS -‐ Australian Bureau of Statistics

• Cabinetmaker –joiner manufacturing furniture and appearance woodwork,

including household cabinetry and joinery items

• EWPAA – Engineered Wood Products Association of Australasia

• FIAA – Furniture Industry Association of Australia

• FWPA – Forest & Wood Products Australia

• HIA – Housing Industry Association

• Joiner – manufacturer of wooden building components, including cabinetry and

joinery items

• Joinery substrate – Particleboard and Medium Density Fibreboard

• Mean – average of a series of numbers

• Median – middle number in a series of numbers

• MDF -‐ Medium Density Fibreboard

• PB – Particleboard

• Standard House – the average or standard house reported by HIA members, to

the HIA


66

Appendix Two – Methodology Because of the difficulties with respect to reliability, applicability and granularity of

import data, this analysis has used three separate but inter-‐related approaches,

supplemented by feedback and cross-‐checking with related data. These are

described as elements, and set out on that basis, below.

Element 1 – Volume of joinery in Australian dwellings

Step Method Source

1 Define standard Australian dwelling HIA Standard House21

2 Calculate volume of joinery substrate used in standard Australian dwelling

[see table at Appendix Four]

HIA Standard House

3 Calculate volume of joinery substrate used in Australian dwellings, by main type, by estimating joinery as a proportion of the HIA Standard House

Industry feedback

4 Calculate 2016 joinery substrate volumes for new dwellings by multiplying the output from 3. above, by the number of commencements by main type

ABS Catalogue 8752.0033 Table 3

5 Define number of kitchen, bathroom and laundry renovations in 2016

HIA-‐GWA Kitchens & Bathrooms

6 Calculate 2016 joinery substrate volumes for renovations by multiplying the output from 5. Above, with 3. above

Calculation

7 Collate outputs from 4. and 6. above to establish volume of particleboard and MDF used in Australian dwellings in 2016

Calculation

21 defined by Davis Langdon Australia


67

Element 2 – Consumption of joinery substrates in Australia

Step Method Source

1 Calculate Australian particleboard and MDF production, imports and exports

Industry feedback and ABS trade statistics

2 Define end-‐uses of particleboard and MDF in Australia Industry feedback

3 Calculate and estimate volume of particleboard and MDF utilized in each of the defined end-‐uses for 2016

Industry feedback

4 Compare output from Element 1-‐7, with output at 3. above to establish maximum implied import proportion

[CONSUMPTION – LOCAL JOINERY PRODUCTION = IMPLIED IMPORTS]

Calculation

Element 3 – Imports of joinery

Step Method Source

1 Identify relevant import codes HTISC Descriptors

2 Collate import data for relevant import codes ABS Merchandise Trade Databases

3 Define a set of ‘rules’ or assumptions for cleansing the data

[see Appendix Three]

Industry feedback

4 Apply rules to all relevant data series

5 Undertake data analysis to calculate import volumes, values, prices, source countries and appropriate averages

Calculation

6 Calculate volume of particleboard and MDF in imported joinery by multiplying the output from 5. above with the output from Element 1-‐7 to establish minimum implied import volumes

Calculation


68

Appendix Three – Assumptions This analysis includes, as discussed, some significant data gaps that need to be

bridged in order for the analysis to be completed. This is the role of informed

estimates and assumptions. The assumptions used for this analysis are set out

below.

Element 1 – Volume of joinery in Australian dwellings

Joinery in the HIA Standard House – industry feedback and calculations

a. HIA Standard House is satisfactory for this analysis, as set out by Davis Langdon Australia

b. All joinery substrate is 16mm thickness (implying it is melamine backed) c. Number of shelves has been estimated for each joinery type d. An average of nine (9) cabinets is included in kitchens e. Plinths are estimated 100mm height f. No additional material has been estimated for bracing of joinery g. Other dwelling types have, on average, less joinery than the standard house h. Some joinery items are particleboard (shelves in particular) and are unlikely

to be imported as finished products, but may be imported as particleboard i. Doors for vanities and bathroom joinery excluded due to potential variation

in material use, including glass, mirrors and open joinery

Volume of joinery substrate in the average Australian dwelling, by type – industry

feedback

Dwelling type % of Joinery in HIA Standard House

Free-‐Standing House 100% Townhouses -‐ 1 Storey 90%

Townhouses -‐ 2+ Storey 90%

Flats -‐ 1 & 2 Storey 77% Flats -‐ 3 Storey 75%

Flats -‐ 4+ Storey 65%


69

Number of kitchen, bathroom and laundry renovations undertaken each year – HIA

and calculation for laundries

Kitchens Bathrooms Laundries New Renovation New Renovation New Renovation

2015-‐16 231,800 144,670 441,200 217,000 231,800 28,934 2016-‐17 215,800 146,132 421,000 219,621 215,800 29,226 Average 226,741 145,401 431,100 218,311 226,741 29,080 Total 372,142 649,411 255,821

Element 2 – Consumption of joinery substrates in Australia

Proportional use of particleboard and MDF in Australia, by end-‐use application –

industry feedback and data analysis

Total % Apparent Consumption 1,723,420 -‐

Detailed End-‐Uses Particleboard Flooring – Residential 249,531 14.5 Particleboard Flooring -‐ C&I 49,504 2.9 Furniture 240,746 14.0 Industrial (barriers, inc. sound) 252,052 14.6 Merchants, Shelving etc 120,761 7.0 Joinery – C&I 50,000 2.9 Mouldings 117,671 6.8 Doorskins 130,746 7.6 Other/Unknown 82,687 4.8 Joinery – Residential 516,194 30.0

Broad End-‐Use Categories Household/Residential 927,670 53.8 Commercial & Industrial 351,556 20.4 Furniture 240,746 14.0 Other/Unknown 203,448 11.8


70

Element 3 – Imports of joinery

Limitation of relevant import codes – data analysis, expert advice

Import Code Descriptor Assessment

4418.90.00.3722

Builders joinery and carpentry of wood (incl. cellular panels) (excl. windows and their frames; doors, their frames and thresholds; shuttering for concrete constructional work; shingles and shakes; etc)

May include some joinery, but industry feedback is this is LIKELY TO BE LIMITED

4421.90.00.3023

Articles of wood, nes (excl. wooden articles previously separately identified in this chapter and wooden articles of furniture falling in HS Chapter 94)

Any other wood products. This is a ‘catch-‐all’ grade and can include any product not elsewhere specified, including joinery products ~ LIKELY TO BE LIMITED

9403.30.00.4124 Wooden furniture of a kind used in offices Unlikely to be relevant to joinery

9403.40.00.24 Wooden furniture, of a kind used in the kitchen

Includes cabinetry carcasses, including flat packed, as well as kitchen furniture for caravans and vans

9403.50.00.23 Wooden bedroom furniture

Unlikely to be relevant as Customs Agents advise built-‐in wardrobe furniture is a builder’s joinery product

9403.60.00.25 Wooden outdoor furniture Unlikely to be relevant to joinery

9403.60.00.26 Wooden coffee tables, nests of tables and similar wooden furniture


9403.60.00.2725 Wooden buffets, sideboards, wall units and similar wooden furniture


22 Code was amended with effect from 1st January 2017. Two new codes were created – 4418.91.00.42 and 4418.99.00.43

23 Code was amended with effect from 1st January 2017. Two new codes were created – 4421.91.00.20 and 4421.99.00.21

24 Customs agents and importers report that almost all imports under 9403.30.00.41 are imported as flat packs. Although not pertinent to joinery imports, this is useful additional information. 25 Furniture manufacturers report they experience an estimated 90% of imports under 9403.60.00.27 are imported as flat-‐pack and that 80% of the material used is Particleboard, 15% is MDF and 15% is solid wood. Although not pertinent to joinery imports, this is useful additional information.


71

Minimum and maximum import prices (AUDFob/unit), and other criteria, of joinery

imports – data analysis and industry feedback

No. Assumption Source Implication for Data Analysis

1 Min. import price of kitchen joinery is AUDFob55/unit*, based on estimated minimum retail price of AUD65/unit

Online26 Remove imports <AUDFob55/unit

2 Max. wholesale price of joinery is AUDFob750/unit*, based on estimated maximum retail price of AUDFob936/unit

Online27 Remove imports >AUDFob750/unit

3 Min. number of units is 10 per shipment

IndustryEdge Remove imports where <10 items

4 Flat pack joinery will be imported by SEA

Industry Remove imports by ‘AIR’ or ‘POST’

5 Reported average AUDFob/unit prices are 50% of the retail price

IndustryEdge Allows cross-‐check with retail pricing

26 Ikea, 2017 IKEA Catalogue, sourced, April 2017 27 Kaboodle, http://www.kaboodle.com.au, sourced, April 2017

flat-pack joinery imports market study report

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