Good signal

Statistics show that, in the first 6 months of 2023, the export value of wood and wood products is estimated at 6 billion USD, down 28.8% over the same period in 2022. In which, the export value of wood products is estimated at 4.1 billion USD, down 32.8% over the same period in 2022.

According to Ms. Le Hai Lieu - Chairman of the Board of Directors of Duc Thanh Wood Turning Chair Joint Stock Company, Vietnam's export of wood and wood products continues to decline sharply due to the impact of the difficult situation and the decline in purchasing power of many major economies. For Duc Thanh, although wood export in the first half of the year has not seen a good start, compared to the target, the company's plan set for 2023 is still guaranteed.

Especially, from the end of June until now, the wood export market has started to have positive signals again when the number of customers asking customers, visiting customers, attending fairs, customers asking for prices.. more. "Contrary to a few months ago at the end of last year, the market was very quiet, but now it is starting to prosper again ," Ms. Lieu informed.

According to Ms. Lieu, the unit now has the standard of resources, ready to receive large orders. “We are always ready. We reserve both raw materials, personnel and production facilities so that, after the crisis, everyone will be ready to receive large orders and especially urgent orders,” said Ms. Lieu .

Mr. Nguyen Phuong - Director of Minh Thanh Co., Ltd. also said that wood export orders are coming back, but the number of orders is no longer as large as before, and the delivery time is shortened from 70-90 days to 45-60 days.

Many wood businesses have started to have orders again

"The requirement for companies at this time is to change in the direction of investing in machines with more versatility to streamline production. Therefore, businesses find machines to replace many stages in production, save costs, good prices and on-time delivery to customers," said Mr. Nguyen Phuong .

Mr. Tran Anh Vu, Vice Chairman of Binh Duong Woodworking Association, said that along with finding product lines for niche markets, businesses are also gradually becoming more active in finding new orders.

Many businesses have boldly restructured factories, cut unnecessary costs and improve productivity. From there, factories can offer products at more competitive prices to increase their ability to attract and receive more orders from old customers.

Many businesses believe that, normally, the bottom cycle of the wood industry lasts about 6 months - 1 year, so it is forecasted that after a gloomy period, the export of wood and wood products will likely recover in the fourth quarter of 2023 and 2024. In fact, there are now some more optimistic signals with the order situation in 2024 of enterprises.

Towards specific wood products

According to Ms. Cao Thi Cam, a representative of the Vietnam Timber and Forest Products Association, said that although wood exports dropped sharply in the first half of 2023, in products, there were still growth groups. Typically, fiberboard products have an export turnover of nearly 32 million USD to India, up 3 times compared to the same period last year.

With wood chip products, in the first half of 2023, the export value of woodchips reached more than 1 billion USD, up 3% over the same period in 2022. In which, China and Japan are still the two main markets consuming wood chips exported from Vietnam; in which, exports to China account for over 70%.

The Vietnam Wood and Forest Products Association also said that it is expected that in the near future, the demand for pellets in the Korean market will increase again with a consumption of 100,000 tons/month. In Japan, Vietnamese enterprises have signed long-term contracts of 2-3 years to supply tablets. It can be seen that the two major import markets of Vietnam's tablets, South Korea and Japan, (accounting for 98% of the total volume) are showing good signals.

With the European market , this market gradually stabilized after the fever of energy supplies, including biomass fuel. However, with strong commitments to reduce emissions and increase use of bioenergy, pellet exports will recover in both price and volume from the last months of 2023. This is a good sign for Vietnam's wood industry. Along with that, many businesses also find separate ways to find new customers for the next phase of the wood industry to cope with current difficulties.

Mr. Patrick Mui, Managing Director of Centdegrés Vietnam, assessed that furniture entering the European market, where the decorative segment is considered a niche market, is expected to grow 4.27% per year for the period 2023-2026, and can reach $7.05 billion by 2026. With the more indigenous and unique interior decoration products, the more Vietnamese small and medium enterprises will have more niche markets, which will target certain customers in the European market.

The wood export market is showing positive signs. However, according to Ms. Le Hai Lieu, currently all markets require designs to continuously innovate materials. For example, sometimes rubber wood, rice must be Melaleuca wood or other types of wood, and combined with other materials. The product must always be diverse and rich, it must have something different from before. “For example, it's just a round, rectangular cutting board that can be cut as long as it is cut. But in Duc Thanh, the design of the cutting board, the unit has several hundred types, if the thickness, width, and length are taken into account, there are thousands of different types. If you don't have anything new, if you don't have anything good, it's very difficult for you to survive," emphasized Ms. Le Hai Lieu.

In general, the demand for the global wood market increases every year by 7-8%, which means that we still have a lot of room and opportunities for future development. Therefore, experts say that the current difficulties are only temporary, due to the general difficulties of the market. The market may warm up when inflation is under control, market demand is warm again.