Export wood processing industry revives

Retaining regular customers

Dat Phuong Production and Trading Co., Ltd. in village 2, Viet Cuong commune (Tran Yen district, Yen Bai province) was established in 2011, operating mainly in the field of agricultural and forest product processing. Main products include plywood and processed joss paper, exported to the markets of South Korea, Taiwan, Malaysia, and India through two forms of entrustment and direct export.

Mr. Cao Huy Dieu, Director of Dat Phuong Production and Trading Co., Ltd., said that from the end of 2021 to the end of 2023, the consumption market for agricultural and forest products in general and furniture in particular encountered many difficulties due to the COVID-19 pandemic and conflicts and wars around the world.

In response to that situation, the company proactively made savings and cut input costs to bring product prices to the lowest level acceptable to both customers and businesses, thereby creating jobs for workers while retaining traditional customers. In 2023, the company processed and exported more than 10,000 m³ of plywood, with revenue reaching over VND 50 billion. Currently, the unit is creating regular jobs for more than 100 workers, mainly local workers, with an average income of VND 6.2 million/month.

In 2024, the company continues to invest in an additional plywood production line to increase export processing capacity to 250–300 m³/month. In the first two months of the year, the company exported nearly 2,000 m³ of plywood to the South Korean and Malaysian markets. With positive signals from the markets, the company will expand production scale, striving for a yearly revenue of over VND 100 billion. In addition, select input raw materials that ensure specifications and quality; invest in upgrading machinery systems and vocational training for workers to create high-quality products and maintain a reputation with customers.

Diversifying export markets

In 2017, Kim Gia Production Trading Joint Stock Company officially built a plywood factory with a total area of 50,000 m² in the Southern Industrial Park, Yen Bai province. Introducing modern factory and machinery systems and new technology into production not only helps strictly control product quality but also improves production capacity and meets customer requirements. Accordingly, the company's products have conquered the domestic market and been exported directly to demanding markets such as South Korea, the US, and European countries.

Mr. Nguyen Ngoc Huong, General Director of Kim Gia Production Trading Joint Stock Company, said that recently, the Vietnamese wood export market has encountered many difficulties; many businesses have suffered losses and gone bankrupt. Thanks to the strategy of maintaining production, finding customers, and diversifying markets, the company operates relatively stably, but product export is still slow compared to plan.

In early 2024, the company signed a number of international orders with businesses in the US and some European countries, but it still did not meet expectations because the requirements of these markets are very strict, especially for raw material areas that are required for FSC forest certification.

According to the comment and evaluation of the functional sector, in 2024, the wood market has shown signs of recovery and is expected to recover strongly in the last months of the year.

Building raw material areas and applying advanced technology

According to data from the Yen Bai Department of Industry and Trade, in the first 2 months of 2024, the province's industrial production value is estimated at approximately VND 3,500 billion, an increase of 11.4% over the same period. Notably, the planed forest wood production and processing industry has recovered; many companies and enterprises, after months of slowdown and difficulties in product consumption, have had their first export orders.

In 2 months, Yen Bai’s wood and wood product processing industry increased by 30.2%. Some main products increased significantly, such as shavings and wood chips (53.17%), plywood (23.4%), etc. The agricultural and forestry product processing industry always plays an important role in the province's socio-economic development. Currently, the production and processing value of this industry accounts for about 43% of the province’s total industrial production value. Every year, it creates jobs for about 10,000 workers with an average income of VND 6–8 million/month.

Yen Bai province has abundant raw material resources; the annual output of wood that can be exploited is nearly 700,000 m³ of all kinds, such as acacia, linden, eucalyptus, and over 150,000 tons of bamboo of all kinds. Thanks to investment in machinery and equipment. Increasingly modern machinery and equipment and advanced technology have contributed to improving wood product quality. The plywood, finger joint, wooden chopstick, and pellet products have been exported to many countries around the world.

Currently, Yen Bai province has attracted many businesses and companies with large-scale, high-quality wood production projects, such as Thien An Wood Co., Ltd., Hoang Gia Yen Bai Co., Ltd., Kim Gia Co., Ltd., Good Industry LLC, Truong Minh Co., Ltd., Junma Yen Bai JSC, An Viet Phat One Member Co., Ltd., and YiFan Hong Kong Co., Ltd.

Mr. Pham Trung Lan, Deputy Director of the Yen Bai Department of Industry and Trade, said that the province's wood processing industry has had many innovations and developments; however, most processing enterprises are small-scale with limited resources. The work of trade promotion has not had a good linkage between trade support organizations and businesses. Enterprises in the province mainly carry out processing for foreign brands. Therefore, the troubles caused by the COVID-19 pandemic and the war have affected the global economy and also caused many difficulties for the wood processing industry in Vietnam in general and Yen Bai in particular.

To sustainably develop the planted forest wood processing industry, Yen Bai province has been focusing on building raw material areas, attracting investment, planning processing facilities, applying eco-friendly technology, and supporting businesses in promoting their brands, products, and the industry. Promoting human resource training, especially a team of processing technology engineers and highly skilled workers. Developing industrial zones and clusters to create motivation to promote the development of planted forest wood processing projects.

Besides, accelerating the innovation of processing technology to create highly competitive products with great value and save raw materials. Enhancing trade promotion to find new export markets.

Yen Bai province strives to become a high-tech planted forest wood processing center in the Northern midland and mountainous regions, according to Resolution No. 29 dated February 24, 2021, of the 19th Provincial Party Executive Committee on Yen Bai Industrial Development towards sustainability, efficiency, and environmental friendliness in the period 2021–2025.