Positive Signals in Vietnam’s Wood Exports
In 2024, Vietnam’s wood industry exhibited a positive development trend. According to Zhao Wenli, Deputy Director of the Forestry Department of the Ministry of Agriculture and Rural Development of Vietnam, in the first eight months of 2024, Vietnam’s total export of wood and forest products reached nearly USD 10.2 billion, of which wood exports amounted to approximately USD 6.97 billion. The government has set an export target of USD 14.2 billion for the whole year, a 6% increase compared to last year. So far, Vietnam has completed 67% of its annual goal, providing an optimistic signal for the wood industry.
From a market perspective, the United States continues to be the largest export market for Vietnam’s wood and wood products. In the first eight months of 2024, Vietnam’s wood exports to the United States increased by 25.9% year-on-year, reaching USD 5.5 billion. The second-largest market is China, with export earnings of USD 1.2 billion, a year-on-year increase of 39%. The third-largest market is Japan, with export revenue of USD 961 million, a growth rate of 1.4%. Additionally, Vietnam also exports wood products to South Korea, Canada, and the United Kingdom, achieving export revenues of USD 452 million, USD 133 million, and USD 124 million, respectively.
Enhancing the Competitiveness of the Wood Industry
The positive performance of Vietnam’s wood exports is attributed to several advantages. Firstly, Vietnam’s wood processing industry has a skilled labor force and an abundant supply of wood materials. Additionally, the legality and traceability of Vietnam’s wood imports provide strong assurance for wood product exports. Chairman of the Vietnam Timber and Forest Product Association, Du Xuanli, pointed out that although the export outlook is optimistic, the industry still faces many challenges, including uncertainty in major markets and rising logistics costs.
To enhance the competitiveness of the industry, Du Xuanli proposed five key pillars: improving production technology, meeting emission reduction targets, promoting digital transformation, developing markets, and building enterprise internal control standards. These initiatives will help the Vietnamese wood industry seize market opportunities and enhance competitiveness in the last few months of 2024.
A Review of Vietnam’s Wood Exports in 2023
In 2023, Vietnam’s wood industry experienced a rare export decline in its history. According to Nguyen Quoc Tri, Deputy Minister of Agriculture and Rural Development of Vietnam, the total export value of wood and forest products in 2023 was USD 14.47 billion, a decrease of 15.4% compared to 2022. Among them, the export value of wood products was USD 9.113 billion, a decline of 17.5%; wood exports amounted to USD 4.354 billion, down 12.4%; and non-wood forest product exports reached USD 1.002 billion, a decline of 7.7%.
The main reasons for the export decline were high inflation in Vietnam’s major markets, such as the United States and the European Union. Governments around the world adopted tight monetary policies, leading to reduced consumer spending, which cut demand for non-essential goods, including wood products. Rising shipping costs and the increasing prices of wood raw materials also directly pushed up product costs. Additionally, international conflicts further exacerbated the rise in logistics costs and raw material prices. Global trade barriers increased the difficulty for Vietnam’s wood industry to enter certain markets.
Goals for Vietnam’s Wood Industry in 2024
Despite the challenges of export decline in 2023, Vietnam’s wood industry has set higher targets for 2024. According to the Vietnamese government’s plan, the total export goal for the wood industry in 2024 is USD 15.2 billion. Among them, wood and wood product exports are expected to reach USD 14.2 billion, a 6% increase compared to 2023.
Vu Baofu, Director of the Trade Promotion Bureau of the Ministry of Industry and Trade of Vietnam, stated that Vietnamese wooden furniture has been exported to more than 140 countries and regions worldwide. Vietnam’s wood and wood products hold a unique competitive edge in the global market, maintaining high-quality standards throughout the entire production process from raw materials to finished products.
Opportunities in the Global Market
Despite the many challenges, Vietnam’s wood industry still holds significant market potential. Experts predict that the global furniture market is valued at approximately USD 405 billion annually, with the demand for wood and wood product imports reaching USD 230 billion, while Vietnam currently holds only over 6% of the market share. This suggests that there is still substantial room for expansion in Vietnam’s wood industry.
Furthermore, free trade agreements signed between Vietnam and many countries provide new momentum for the expansion of the wood industry. These agreements will help reduce trade barriers and increase the competitiveness of Vietnamese products in the international market.
Summary
- In the first eight months of 2024, Vietnam’s wood industry saw rapid export growth, especially in the U.S. and Chinese markets.
- Although the competitiveness of the wood industry has improved, it still faces challenges from global market uncertainties, particularly rising logistics costs and increasing trade barriers.
- The global furniture market holds enormous demand, and there is still room for Vietnam’s wood products to increase their export share, especially with the support of free trade agreements.
- By continuously optimizing production technology and market development, Vietnam’s wood industry is not only addressing challenges but also seeking more market opportunities.
