23-5-2023 (Hanoi) Vietnam’s wood and wood products exports have experienced a significant decline of over 30 percent in the first four months of this year, reaching 3.9 billion U.S. dollars compared to the same period last year. This slump is primarily attributed to a global downturn in demand, as reported by Vietnam News on Tuesday.
The report highlights that local wood manufacturing activities have entered a downward spiral, with new orders plummeting by 50 to 60 percent since the beginning of the year.
Do Xuan Lap, Chairman of the Vietnam Timber and Forest Products Association, stated that Vietnamese manufacturers are left with only a few export orders, mostly lasting until the middle of the year, and primarily consisting of small orders. Lap further explained that buyers, especially those in the United States, have refrained from placing new orders due to high stockpiles.
During the January-April period, Vietnam’s exports of wood products to key markets such as the United States, Japan, South Korea, and China witnessed a sharp decline. Specifically, exports to the United States fell by 38 percent, amounting to 2.02 billion dollars compared to the same period last year. Shipments to South Korea tumbled by 22 percent, reaching 274 million dollars, while exports to Japan experienced a 1.5 percent decline, totaling 556 million dollars.
Experts in the industry attribute the slowdown in wood and wooden goods exports to rising inflation in major markets, which has led to sluggish demand.
Nguyen Liem, Chairman of the Binh Duong Woodworking Association, acknowledged the uncertainty in the global economy, making it difficult to predict future trends. He stated, “The market is not sending positive signals, thus it is hard for wood companies to draw up their business plans.” Liem further revealed that local manufacturers have reduced their production capacity by 60 percent amid the current downturn.
The export market is projected to remain stagnant until the end of 2024, with a mild recovery anticipated only in the early part of next year, according to Liem.
Despite the challenging circumstances, Vietnam managed to earn over 16 billion dollars from wood and wood product exports last year, surpassing the target by 3.8 percent, as reported by the association. This achievement occurred despite high inflation, rising input costs, and disruptions in supply chains.
The country aims to achieve 7-9 percent growth in wood and wood product exports this year, with a focus on wood pellets and woodchips, which are expected to reach 1 billion dollars.
