Wood “holding their breath” for the goal of becoming a key sector

According to the Association of wood processing and export Vietnam, 10 months of 2012, exports reached US $ 4 billion of wood, contributing in no small part to the total exports of the country. Timber market many years ago is considered a potential market for the export sector. In particular, the US and Japan are the two markets are highly quality furniture products of Vietnam. The timber industry experts said that the passage of time, changes in timber export market is trending in favor of timber processing enterprises of Vietnam, especially for the US market as it is to apply the policy imposition of anti-dumping on China’s wood products. Therefore, the order of new product lines and new customers from the US into Vietnam more. Besides the US, the Japanese market was also assessed as market-friendly and safe, rich in potential for our wood exports …


So much potential, but, like a number of other key industries, the advantage in the market for timber is still the vast majority of enterprises with foreign investment (FDI enterprises). Speaking of timber export value from the industry so far this year, leaders of the Ministry of Agriculture and Rural Development said FDI enterprises currently account for 50% of total export turnover of wood, while the total number of FDI enterprises processing wood accounts for only 16%. “The number of FDI enterprises of the timber industry” red “in Vietnam about 400 companies, but specializes in the processing and export of timber is only about 220 enterprises,” said Nguyen Ton Quyen – Chairman of Association of Vietnam Timber and Forest Product for know, but as his rights, the dominant FDI enterprises virtually timber export market by the advantages that they can be on modern technology, large-scale and special, they always get the support to capital low interest rates from the state. Therefore, FDI enterprises always put on the market the premium product of great value. And domestic companies, by contrast, they are faced with numerous difficulties in technology, production scale as well as access to funding from banks …

Nguyen Ton Quyen, if calculated on the level of employment, up to 46% of domestic timber processing enterprises microscopic scale; 49% of small-scale; 1.7% medium and only 2.5% are large-scale enterprises. And in terms of investment, up to 93% of timber processing enterprises are small and compact cars. ” Because small-scale enterprises, weak capital, labor skills not high, not deep, wooden products of Vietnam enterprises can hardly compete with FDI enterprises in the market.

In particular, the greatest difficulties of the current timber industry that is, we have to import up to 80% of raw materials. A complete wood products alone but input costs such as the cost of bank interest rates, transport costs and especially costs for input materials caused product prices pushed up very high. This becomes weakness of domestic companies, where the invested enterprises from countries such as Malaysia, Indonesia … they have a huge advantage on raw materials. Plus all the input costs to the price of domestic enterprises can hardly compete with FDI enterprises. “To be able to sustain the market, keeping competitive prices from early 2012 to the present, domestic enterprises have to accept the break, if businesses are profitable and only about 3% rate, not more interest”, President of the Association Vietnam Timber and Forest product evaluation. even so, many capital difficulties domestic enterprises have to shut down or sell immediately after the raw material has to import about maintaining production. According to Mr. right, this situation, if not improve in the coming period to 2013, only domestic companies will have to “live” what kind, let alone the more distant future.

Thus, one can see the timber industry are striving objectives fall in “list” key industries of Vietnam song, the same fate with the industry are also considered such as Textile spearhead, hydro products, footwear … 100% owned enterprises in countries that have made way for enterprises to master foreign invested upright on the “home”.

To overcome the current difficulties and sustainable development of the timber industry, experts say, one of the decisive factors that have to be active in raw materials. “Actively source materials that will help us reduce the cost of inputs is very large, this is the leading factor for the development of all industries, not just the timber industry,” an industry expert said. “Besides, in order to overcome the difficulties on the scale of production, capital, reduce input costs, he said rights, Timber and Forest product Association of Vietnam are discussing solutions to link co-production among enterprises to jointly support each other in the field of manufacturing and exporting.

According to the Ministry of Agriculture and Rural Development, currently, the Ministry continues search for building materials in the country areas, how to strive to 2020 provided 60% of raw materials for the wood processing industry and to 2030 to supply about 75% of raw materials.