Wood exports inch up, but prospects cloudy

Nguyen Ba Ngai, deputy director of the general department, said this year, export value of forest products gained growth of 5-10% depending on different products but the export value of wood and wooden products rose by 1% against last year, reported Hai Quan (Customs) newspaper.

The slight growth was due to strong reduction in the export value of wooden chips compared with last year, or 61% of the export value of wooden chips in 2015, he said.

Decrease in exports of wooden chips this year was due to a fall in demand for this product on the world market, especially China, said Ngai, adding that Vietnamese wooden chip products have faced competition with similar products from other countries such as Thailand, Australia and some African nations.

This year, Vietnam promoted diversification of the export market to increase market shares on the world market, Ngai said. Especially, Vietnam has completed negotiations on the Voluntary Partnership Agreement on Forest Law Enforcement, Governance and Trade (VPA/FLEGT) between Vietnam and the European Union, opening many opportunities on market development in the future.

Lack of material

Experts also said Vietnam’s wood processing industry would continue development in production and business over the coming years.

However, wood processing enterprises said the industry had fallen due to a lack of material for production.

Bui Nhu Viet, vice chairman of the Binh Duong Wood Association, said enterprises in the South were lacking material for production because in the past, many Chinese enterprises had come to purchase large volumes of wood.

Truong Mong Trinh, director of Moc Luc Wood Company, also said more and more foreign enterprises had purchased wooden material, leading to a lower supply of the material for local processing companies and a higher price for wood, from VND2-3 million per cubic metre to VND5 million at present.

Do Xuan Lap, chairman of Binh Đinh Wood Association, said now, the price of rubber wood had increased by 20-25% and there was strong competition for wood on the local market.

This put pressure of procuring enough wood for production on enterprises in HCM City, Binh Duong, Dong Nai and Binh Dinh provinces, he said.

Local wood producers said the Government had solutions on avoiding the lack of material for wood processing but export tariff rates at present had not limited export activities for wood, especially exports to China, reported Cong Thuong newspaper.

To ensure sustainable supply of this material in the future, the local enterprises expect the Ministry of Agriculture and Rural Development and the Vietnam Wood and Forest Products Association to propose solutions to the Government on limiting exports of material for wood processing.

Especially, the enterprises proposed increasing export tariffs for timber and sawn timber to 20% as one of the efficient solutions to limit exports of timber for processing wooden products.

Duong Phuong Thao, deputy head of the Import and Export Department from the Ministry of Industry and Trade, said in the future, the State should control exports of wood while also creating favourable conditions for local enterprises to exploit wood in foreign countries.

That meant the Government would work with Vietnam’s enterprises to grow trees for supplying wood in Cambodia and Laos as well as the governments of the two countries to import the material to Vietnam, she said.