Data from the Ministry of Agriculture and Rural Development and the Ministry of Industry and Trade showed that Vietnam’s wood and wood products exports in October 2022 reached 1.2 billion USD, up 7.7% compared to September 2022 and 26% over October 2021. Wood products exports were estimated at 747 million USD, up 1.6% over September and 18.5% over the same period in 2021.
In the first 10 months of 2022, Vietnam’s wood industry achieved an export turnover of 13.5 billion USD, up 11.4% over the same period in 2021.
Wood chips and wood pellets were the main drivers for the growth in wood exports. Meanwhile, wooden furniture exports increased slightly by 2.7%, and this growth comes from the demand in the Asian market. Exports to the US and EU markets declined drastically.
Vietnam’s wood pellet exports in the first 10 months of 2022 were 603 million USD, up 35% in volume and 81% in turnover over the same period in 2021. Wood chip exports in the first 10 months of 2022 reached a turnover of 1.8 billion USD, higher than the turnover in 2021, which was 1.7 billion for the whole year. It is expected that wood chip exports will set a record of more than 2 billion USD in turnover.
With the current export momentum, it is anticipated that wood chips and wood pellets would bring in about 2.8-2.9 billion USD in 2022.
Vietnam’s top exporting markets for wood chips and wood pellets are Asian countries. Korea, Japan, and China saw increased demand in the context that these countries are converting from coal electricity to clean electricity, which includes biomass electricity. China imports wood chips from Vietnam for its paper products and pellet production.
In contrast with the significant growth of wood chip and wood pellet exports, Vietnam’s wooden furniture in the first 10 months of 2022 saw a timid growth of 2.7% compared to the same period in 2021. Wooden furniture export turnover was 9.3 billion USD.
Wooden furniture exports to Asian countries maintained a stable growth rate. Exports of wood and wooden products to Asian countries in the first 9 months of 2022 reached 4.3 billion USD, which increased by about 30% over the same period in 2021.
In recent years, Vietnam’s largest wooden furniture exporting markets are the US and the EU. Specifically, the US accounts for 62% of the total wood export turnover in 2021. However, in the first 10 months of 2022, Vietnam’s wood exports to the US plummeted. Exports to this market now account for 53% of the total wood export turnover.
After 10 months in 2022, wooden furniture exports from Vietnam to the US were 6.5 billion USD, down 3.1% over the same period in 2021. Wooden furniture exports to the EU reached only 784 million USD, down 2% compared to the same period in 2021.
Mr. Nguyen Quoc Khanh, chairman of the Handicraft and Wood Industry Association of Ho Chi Minh City (HAWA), explained that the decrease in exports is due to inflation in Vietnam’s main exporting markets. There is also an additional factor which is the Russia – Ukraine conflict. These reasons prompted consumers to tighten their spending on wooden furniture.
Mr. Nguyen Liem, General Director of Lam Viet Joint Stock Company, said that enterprises specializing in wooden furniture production for export to the US and EU markets faced many unfavorable factors, with increasing product inventories. Specifically, orders in the third quarter of enterprises were only about 40-50%. In the fourth quarter, the orders decreased even more, and there are still no orders for the new year.
Vietnam has become one of the leading countries in processing and exporting wooden furniture and wood products globally. Every year, Vietnam's wood industry uses a lot of wood materials, mainly from domestic plantation timber and imported wood.
Statistics from the Ministry of Agriculture and Rural Development show that the planted forest area in 2020 will reach about 4.4 million hectares.
Acacia has become the most important source of domestic wood materials in Vietnam. This wood source is used widely in many products, especially export furniture. The annual production of this acacia is very large, reaching nearly 50 million cubic meters of logs per year.
Currently, acacia wood is being exploited intensively to serve as material for creating chipboard and pellets. Forest areas in the Central region of Vietnam are cut down when the trees are only 4 years old.
Many traders believe that, in the next few years, when the demand for interior and exterior wood furniture increases, it is likely that the source of wood materials will not be enough to meet the market demand for large wood products.
Compiled by VietnamCredit