Peak at the beginning of the year

At the beginning of 2022, although the export of wood and wood products was interrupted due to the start of the Lunar New Year holiday week, the export value of this item still increased sharply. Statistics from the General Department of Customs show that the export value of wood and wood products in January 2022 reached $1.55 billion, up 14.3% compared to January 2021. In which, the export value of wood products reached 1.15 billion USD, up 6% compared to January 2021. The export value of wood and wood products to most major markets increased in the first month of 2022. In which, the US market was led by US$928.2 million, up 12.8%; followed by the Japanese market with 153 million USD, up 16.3%; China market reached 134.4 million USD, up 27%...

Mr. Do Xuan Lap, Chairman of the Vietnam Timber and Forest Products Association (Viforest) excitedly shared: “In the history of exporting wood and wood products, this is the third time that the export turnover has surpassed the 1.5 billion USD mark/ month. Previously, wood exports had an export turnover of 1.512 billion USD in March 2021 and reached 1.55 billion USD in June 2021.

The goal of exporting wood and wood products to reach 17.5-18 billion USD in 2022 is quite positive Photo: Nguyen Thanh

According to the Import-Export Department (Ministry of Industry and Trade), in 2022, there are many advantages for the wood industry to have a breakthrough growth, thanks to the gradual recovery of growth in the global economy after the Covid-19 pandemic, the construction industry in many markets. Strong activity drives up demand for furniture. Besides, the initiative in production technology, diversifying export markets, diversifying product structure, improving export competitiveness by taking full advantage of trade agreements. Free trade (FTA) of Vietnamese enterprises will create a driving force to promote the export of wood and wood products.

Viforest's President said that in 2022, the industry's export target set from 17.5-18 billion USD is completely achievable. In which, 5 key export product groups such as seats will reach 4.1 billion USD; furniture, furniture will reach about 10 billion USD; wood chips reached about 2.1 billion USD; tablets reached about 0.6 billion USD; plywood reached about 1.3 billion USD. In particular, the product groups that are attracting great attention are wood chips and pellets, industrial materials (interior-exterior furniture) with a very strong production shift from international to Vietnam. The group of industrial materials focuses on production for the US market, while the Japanese market has a great demand for wood chips and pellets.

Increased cost pressure

Right after entering the recovery phase after the 4th Covid-19 epidemic, Viforest's member businesses said that new orders were plentiful. However, the situation of logistics costs, the price of containers and materials being kept at a high level as well as the lack of initiative in the supply of raw wood are still a "headache" story for wood traders.

According to Mr. Le Minh Thien, Chairman of Binh Dinh Forest Products Association (FPA), in the province, there are more than 100 enterprises operating in the field of wood processing for export. In particular, due to the lack of domestic raw material supply, enterprises are quite passive, having to depend on 80% of imported raw materials. Enterprises have no choice but to accept the risks related to quality and origin certification. “That is not to mention a series of other problems such as: countries exporting wood materials recently have to be bound by regulations on environmental protection; supply decreases; The price of raw wood has continuously increased because of the scarcity of raw materials and the increase in freight and logistics costs…”, Mr. Thien said.

To Xuan Phuc, an expert from Forest Trends, informed that the freight charge for a 40-foot container has increased from $1,500 in July 2019 to nearly $8,500 in July 2021, an increase of nearly six times. within 5 years. Notably, in addition to increased freight rates, the Covid-19 epidemic also created a shortage of wood supply in some of the main timber supplying countries for Vietnam, especially for low-risk sources such as the US. and European countries.

A company specializing in making outdoor furniture in Binh Dinh said that there are businesses offering imported wood at a price of 215 USD/m3 of sawn eucalyptus wood, while the previous highest price the company bought was only 172-175 USD. /m3. Meanwhile, an enterprise in Binh Duong shared that the price of imported wood together with high transportation costs made the profit of the enterprise decrease from 7-8% to 3-4%.

In order to reduce logistics risks, Mr. Do Xuan Lap suggested that the Government, the Ministry of Industry and Trade and the Ministry of Transport continue to create favorable conditions in terms of mechanisms and policies, and enhance investment attraction in port infrastructure. sea, fleet, container services, do not let the dependence of this field be too great on a number of countries in the region.

In addition, the Government should be consistent with the goal of reducing risks in the supply of imported tropical timber and in trade fraud. The timber industry should be considered as one of the priority industries to fully realize this goal, not only because of its economic significance, but also its social and environmental significance. “Recommending consulting agencies in major markets (US, EU, UK…) that import wooden furniture from Vietnam to continue to follow closely and provide timely information on the situation of import, markets, and customers for Domestic exporters to minimize potential risks, "said the Chairman of Viforest.

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