The wood industry is proactive, creative, flexible, turning risks into opportunities

According to the Department of Forestry, the forest area of localities has increased quite rapidly. The country's forest area currently has about 14.7 million hectares, of which planted forests are nearly 4.6 million hectares (31%), and natural forests account for 10.1 million hectares (69%).

Since 2016, Vietnam has closed its natural forests, completely stopping the exploitation and salvage of wood from natural forests across the country.

The wood industry aims to develop legal raw materials and implement commitments and actions for the Government's Net Zero goal by 2050 at COP26. Therefore, the green transformation of wood industry enterprises is urgent.

In February 2020, the Ministry of Agriculture and Rural Development and the WB signed the "Agreement to reduce emissions in the North Central region" for the 2018 - 2024 period. The year 2023 marks a very important milestone, the first time Vietnam successfully sold 10.3 million forest carbon credits (10.3 million tons of CO2) through the World Bank (WB) at a unit price of US$ 5/ton, earning US$ 51.5 million (equivalent to VND 1,200 billion), bringing opportunities to increase income for forest growers.

Each year, the country exploits 30,000 million m3 of wood, which accounts for about 75% of wood materials. Planted forest wood has become the main raw material for the wood processing industry and export.

The plan "Development of large timber production forests in the period 2024 - 2030" of the Ministry of Agriculture and Rural Development, sets a target that by 2030, the total area of large timber production forests will reach about 1 million hectares, of which the area will be maintained. The existing large timber plantation area is 500,000 hectares and new development in the 2024-2030 period is about 450,000 - 550,000 hectares.

In difficulty, there is opportunities

According to the Department of Forestry, the export value of forest products from 2016 to the present has increased continuously, reaching a peak of US$ 17.4 billion by 2022. However, in the difficult context of the world, in 2023, for the first time in 15 years, Vietnam's wood industry recorded a decrease in export turnover. Although there has been growth again in the last months of 2023, Vietnam's total export turnover of wood and wood products in 2023 reached US$ 14.5 billion, down 15.4% over the same period in 2022.

The 5 main export markets of Vietnamese wood and wood products account for 89.13% of the industry's total export turnover, including the United States, China, Japan, Korea, the European Union and other countries. Export turnover to these markets decreased from 12% to 30% compared to 2022.

Among the 27 countries, the EU is the 5th most important export market, accounting for 3.5% of the industry's total export turnover, reaching US$ 455.52 million, down 29.5% compared to 2022.

Although export turnover to most markets decreased, turnover in the India and Indonesian markets increased sharply. In 2023, export turnover to India reached over US$ 122.02 million, an increase of 292.1% compared to 2022; Turnover from Indonesia reached nearly US$ 86.63 million, an increase of 123.3% compared to the previous year.

Wooden furniture, chairs, wood chips, plywood, and pellets are five of the items with large export turnover in 2023, reaching US$ 11.91 billion, accounting for 90.4% of total export turnover. of industry.

In the opposite direction, statistics from the General Department of Customs show that in 2023, Vietnam's import turnover of wood and wood products reached nearly US$ 2.19 billion, down 28.7% compared to 2022. In particular, Vietnam imports wood and wood products from 117 countries and territories. However, import value is concentrated in five main markets: China, the US, Cameroon (Central Africa), Laos and Thailand. The number of imports gradually decreases yearly, showing success in developing afforestation and building valuable wood material areas.

According to Dr. Nguyen Tuan Hung, Head of the Forest Products Processing and Trade Department, Department of Forestry (Ministry of Agriculture and Rural Development), Vietnamese wood products are trusted by consumers worldwide. Besides, Vietnam has many years of experience and abundant sources of wood materials.

Wood is an environmentally friendly, renewable material that contributes to reducing greenhouse gas emissions, so it receives support from the country and the world. Not only that, the wooden furniture market is very large, estimated at over US$ 400 billion, but Vietnam's export turnover of wood and wood products only accounts for over 6% of the global market share. This is an opportunity for Vietnamese wood businesses to expand and develop international markets.

According to the assessment of the Import-Export Department, Ministry of Industry and Trade, in 2024, although still facing many difficulties and challenges, the global trade outlook is not expected to improve, continuing to have an unfavorable impact on the country. export activities of wood and wood products. However, the positive recovery of some key markets, such as the US, and EU... has brought optimistic signs for Vietnam's exports of this industry. In the first 2 months of 2024, the export value of wood and forest products is estimated to reach US$ 2.68 billion, an increase of 47% over the same period in 2023. The leading markets are still the United States, China, and Japan. In addition, exporting to the Canadian, Australian, and Indian markets also grew well.

Therefore, to seize opportunities, businesses must diversify designs to suit consumption needs in different markets, and product prices are also competitive.

The Ministry of Agriculture and Rural Development estimates that the export value of wood and forest products in 2024 will reach over US$ 15 billion, an increase of about 6% compared to 2023.

To achieve export goals, according to Deputy Minister of Agriculture and Rural Development Nguyen Quoc Tri, the forestry sector must continue to make efforts and have radical and proactive solutions in technological innovation and, the use of raw materials and products and distribute products.

In particular, businesses and wood processing facilities are proactive, creative, and flexible to turn disadvantages and risks into opportunities. Enhance trade promotion, connection, exchange and cooperation; help bring the image of Vietnamese wood and wood products to customers worldwide, attracting customers to Vietnamese wood and wood products.