Good signals of wood exporting enterprises

Updated: 10:15, 13/06/2024

In the first five months of this year, the export revenue of wood and wood products reached 6.14 billion USD, a year-on-year increase of 23.6%. As recorded, the businesses’ orders have been increasing until June, even the end of the year. These are good signals, contributing to improving the export value of the wood industry.

There are currently 6,000 wood production and processing enterprises nationwide, including more than 5,000 private enterprises, 250 state-owned enterprises and more than 660 foreign-invested enterprises (FDI). Out of those, only 810, which have a chain of custody certification in the control system to trace the legal origin of wood, have been certificated.

The production of wood products at Minh Duong Furniture Corporation in Binh Duong Province.

The forestry sector set an export target of 17.5 billion USD this year. According to Deputy Minister of Agriculture and Rural Development Nguyen Quoc Tri, the 2024 target set for the wood industry is quite high, especially in the context of prolonged and unpredictable political conflicts and the difficulties in both output and input factors of exports.

However, the international market has also begun to receive bright spots, such as increased consumer demand after the pandemic outbreaks and reduced transportation costs, which will create opportunities for businesses to make breakthroughs and develop more export markets.

Until now, the internal strength of wood and forestry processing and export enterprises has been greatly improved. Businesses changed their management thinking and administration according to professional models, promoting investment in high and advanced technology to improve labour productivity, improve quality, cut costs, reduce product prices, and promote environmentally friendly technology in the 4.0 revolution.

Regarding production technology, enterprises have focused investment in modern equipment, with automatic production lines that can produce many complicated product details, towards saving raw materials in the production process.

In recent years, businesses have improved the technology used in wood processing. Many have focused on investing in and applying advanced, modern and environmentally friendly technologies, with automatic production lines in wood processing, creating complicated details, saving raw materials, and helping businesses manufacture products with new structures and designs, to meet the needs of the domestic and export markets, especially for high-end products, in terms of quality and aesthetics and those combined with metal and stone.

In addition, many businesses have paid attention to investing, researching and applying the production and supply of machinery, equipment and auxiliary products to replace imported goods, reduce dependence on external sources, save costs, reduce prices, and increase added value, such as machinery and equipment systems for pressing, planning, and classifying wood, paint, glue, surface decoration materials, materials to attach product components and product packaging.

The number of workers in wood processing enterprises has been increasing in both quantity and quality. The country has more than 500,000 workers, of which trained workers with stable jobs account for 55-60%. This workforce has mastered the operation and use of new equipment and technology, replacing the work previously done by foreign experts, while the rest are simple seasonal workers.

On the other hand, the abundant human resources from the young population structure, along with the ingenuity, meticulousness, and creativity of the Vietnamese people, are creating momentum for the sustainable development of the wood production and processing industry.

In addition, the wood processing industry also attracts millions of workers in rural mountainous areas who directly contribute their efforts to growing and creating raw materials for the production and processing of forestry products. The total demand for raw wood for the country's wood processing industry is about 40 million cubic metres of roundwood annually.

In particular, the source of domestically exploited wood is estimated at 30 million cubic metres, accounting for 75%; wood exploited from concentrated planted forests is 20.5 million cubic metres; wood exploited from scattered trees and rubber is about 9.6 million cubic metres; imported wood raw materials are about 8.5 million cubic metres, accounting for 25% of the total wood volume of the processing industry.

100% of domestic and imported raw wood materials serving the forestry processing industry have legal forest product records and ensure traceability according to the provisions of the law.

In addition, domestic non-timber forest products, such as bamboo, rattan, resin essential oils, medicinal plants, and medicinal herbs under the forest canopy, are extremely abundant. Vietnam currently has about 1.4 million hectares of bamboo, equivalent to 6.2 billion trees.

The country has 37 provinces with concentrated bamboo forests, 23 of which have bamboo areas of 10,000 hectares or more. The country also has about 30,000 hectares of rattan, mainly in 28 provinces nationwide, most being natural. Unlike the source of wood that can be imported, the source of bamboo, reed and rattan for production is mostly met domestically.

Vietnam's wood and forestry market maintains exports to 140 countries and territories. The export value of wood and forestry products has always grown in recent years, ranking among the top 10 key export products (over 1 billion USD) of Vietnam.

Vice President and General Secretary of Vietnam Timber and Forest Products Association (VIFOREST) Ngo Sy Hoai, said that up to now, major commodity consumer markets such as the US and Europe have been gradually receiving positive signals, thereby promoting an increase in export orders, including wood and wood products.

In addition, at present, the sharp decrease in sea freight rates has also contributed significantly to helping importers reduce cost pressure and be more confident in planning to re-order. The persistence and flexibility in finding new markets and investment of businesses will soon bring the wood export industry back to growth and help them complete the set target exports.