Source: thuonghieucongluan.com.vn
The wood market may still be under pressure until the end of the first quarter of 2023
The information was given at the Annual Conference of the Ministry of Agriculture and Rural Development last weekend. Speaking at the conference, Mr. Do Xuan Lap – Chairman of Vietnam Timber and Forest Products Association said: In 2022, the growth rate of the wood industry will reach 7.1%. This is considered the most difficult year ever for the wood industry. The growth of the industry is mainly due to markets such as Northeast Asia, Oceania, Korea, Japan…
Mr. Lap said that in the second half of 2022, the wood processing and exporting industry faced difficulties due to lack of capital, lack of input materials and high prices, and the product consumption market was affected. “Previously, at the end of the year, most wood businesses were very busy, working overtime and overtime to keep up with orders to export to Europe and prepare orders for next year. However, this year, there is a lot of inventory in the wood industry enterprises, so far many businesses have not signed any export contracts for 2023, leading to moderate production,” said Mr. Lap.
In 2022, the industry’s turnover will reach $16.928 billion, with deep-processed products accounting for just over half. The reason is that the two main import markets for this product, the United States and the EU, were almost “frozen” during the last 3 quarters of 2022. The wood industry almost only took advantage of the opportunity in the first quarter of 2022, thanks to the old orders from 2021.
According to Mr. Do Xuan Lap, from now until the end of the first quarter of 2023, the wood market may still be under pressure to reduce its consumption capacity by about 50%. If all goes well, by the end of the first quarter, the basic inventory will be sold out. Deeply processed wood products such as tables, chairs, cabinets, etc. can re-enter major markets.
Export is expected to reach 18 billion USD
Mr. Lap said: “If there are not many changes, it is expected that by the second quarter of 2023, basic orders will be restored, reaching about 82-85%. This is considered the starting point of the new year. In 2023, the wood industry is expected to achieve a growth rate of 7-9%, equivalent to 18 billion USD or more.
To do this, the wood industry will continue to focus on improving the competitiveness of businesses by applying the same solutions: Promote the use of domestically planted forest wood, reduce the use of imported wood; apply scientific and technological advances to improve labor productivity; promote digital transformation to reduce production costs; promote low emission production; coordinate with localities to build concentrated processing industrial parks; promote trade promotion activities, organize major international fairs, strive from 2024, will regularly organize 4 large fairs/year…
In order to stimulate demand, the Vietnam Timber and Forest Product Association recommends that wood industry businesses need to find ways to reduce production costs, giving importers more “space” to promote products. Some ways mentioned by Mr. Lap include limiting the use of imported wood materials, innovating production technology and improving management capacity.
“Enterprises also need to diversify markets, diversify customers through improving designs, focusing on high-value product groups, aiming to open representative offices in key markets to introduce new products to customers. product introduction”, Mr. Lap recommended.
In addition, the Vietnam Timber and Forest Products Association will actively coordinate with the Ministry of Agriculture and Rural Development to organize a balanced forestry sector development; afforestation development goes hand in hand with processing. At the same time, coordinate with the Ministry of Industry and Trade to promote trade promotion. Because, only knowing the market can proactively produce and perform well in resolving commercial disputes.
On that basis, Mr. Lap proposed the Ministry of Agriculture and Rural Development to consider the equitization of forestry companies; increase calls for investment from foreign enterprises in afforestation, because they have favorable technology and potential to form production linkages. In addition, the Chairman of the Vietnam Timber and Forest Products Association also proposed that the Government create favorable conditions for disbursing loans for businesses.
