Many major markets recovered, timber and wood product exports increased sharply in Q1

DNHN - Timber industry businesses accelerate production to meet export schedules, opening up positive signals and bringing expectations for the Vietnamese timber industry in 2024.

Preliminary statistics from the General Department of Customs show that the export value of timber and wood products in March 2024 is estimated to reach 1.12 billion USD, an increase of 46.3% compared to February 2024, but a decrease of 1.9% compared to March 2023. Of which, the export value of wood products is estimated to reach 749 million USD, an increase of 57.8% compared to February 2024, but a decrease of 3.9% compared to March 2023.

In the first three months of 2024, timber and wood product exports are estimated to reach 3.4 billion USD, an increase of 18.9% compared to the same period in 2023. Of which, the export value of wood products is estimated to reach 2.3 billion USD, an increase of 22.9% compared to the same period in 2023.

Many major markets recovered; timber and wood product exports increased sharply in Q1
Many major markets recovered; timber and wood product exports increased sharply in Q1.

According to the Import and Export Department (Ministry of Industry and Trade) and the Industrial and Trade Information Centre, the favourable start in the first months of the year with increasing orders and timber industry businesses accelerating production to meet export schedules has opened up positive signals and brought expectations for the Vietnamese timber industry in 2024.

In particular, the demand in major markets such as the United States, China, Canada, the United Kingdom and markets in the EU bloc is recovering, bringing optimism to Vietnam’s timber export industry.

In terms of export market structure, the United States continues to be the largest destination for Vietnamese timber products. In the first two months of 2024, the export value to the United States accounted for 53.2% of the total export turnover of timber and wood products, reaching 1.2 billion USD, an increase of 51.7% compared to the same period in 2023.

However, the over-reliance on the US market increases the risk for the timber industry. Therefore, diversifying export markets will minimise risks and enhance the sustainability of the timber industry. In addition, improving product design and models will also help attract more international customers.

Besides the US market, timber and wood products are also exported to some other markets with high growth rates in the first two months of 2024, specifically exports to the Chinese market reached 306.3 million USD, an increase of 25.3% compared to the same period in 2023. Next is the Canadian market at 36 million USD, an increase of 47.4%; the UK at 32.8 million USD, an increase of 35.2%; the Netherlands at 23.2 million USD, an increase of 46.9%; and France at 22.1 million USD, an increase of 26.7%.

Illustration
Illustration.

Although the signals at the beginning of 2024 are quite optimistic, timber export businesses are facing new difficulties. If the tension in the Red Sea continues, freight rates will increase.

In this context, Mr Tran Quoc Manh, Vice Chairman of the Handicraft and Wood Industry Association of Vietnam, said that many businesses in the industry have proactively coordinated with foreign customers to produce new models with their brands to capture the target market. Many new markets such as China, India, Malaysia, Cambodia, Singapore, Laos, Indonesia, and the Philippines are being exploited by timber and wood product export businesses and are achieving quite good growth.

Mr Nguyen Quoc Khanh, Chairman of the Handicraft and Wood Industry Association of Ho Chi Minh City (HAWA), said that the association’s members are focusing on contributing to the industry’s transition from Original Equipment Manufacturing (OEM) to developing their Original Design Manufacturing (ODM) to enhance the value of “made in Vietnam” products.

The HAWA representative also affirmed that the Vietnamese wood processing and furniture industry is currently one of the industries with the largest trade surplus in the country. Even in 2023, despite difficulties and a decrease in export turnover, the timber industry still brought in a trade surplus of more than 10 billion USD.

P.V

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