The wood industry restructured to ensure operations

​In the first quarter of 2023, wood production and export in the whole country and Dong Nai continued to face difficulties. The decline in export value made the target set at the beginning of the year difficult to achieve, enterprises were having to restructure production to ensure their existence.

Production at an enterprise in Bien Hoa

To remove difficulties, the Prime Minister also held a meeting with the industry, thereby proposing urgent solutions.

There are still many risks

In the first quarter of 2023, Vietnam's export of wood and forest products only reached $3.1 billion, decreased 28.3% compared to the same period. It is expected that in 2023, the value of export turnover will only reach the same level as in 2022. The number of orders decreased sharply, and enterprises had to produce in moderation, greatly affecting production, business, and the lives of nearly tens of million of workers.

This is a very difficult reality for the wood industry, currently, businesses having orders are mainly small ones and only receive orders until June 2023. Normally at this time, enterprises have orders for outdoor furniture and preparing materials until May and have to finish in June, and export to Europe in November and December to be sold in the summer by importers, but so far the company has not received orders. There is still a lot of inventory in the import market, so it also affects the production plan.

According to Mr. Do Xuan Lap, Chairman of the Vietnam Wood and Forest Products Association (Viforest), in the face of difficulties, member associations and businesses in the industry have actively sought to expand markets, focusing on criteria as quality products but at good prices, suitable for tastes, and focuses on after-sales policies. In addition, enterprises continue to restructure production, focus on changing technology, perfecting the production management system, quality of human resources, and increasing the use of domestic raw materials to reduce costs, increase competitiveness...

Dong Nai is the locality with the second largest export turnover in the country, wood enterprises in the province are also forced to manage all aspects. In the difficult context, in March, the Dong Nai Wood and Handicraft Association (Dowa) also held the 6th congress for the term 2023-2026. Mr. Vo Quang Ha, Deputy Standing Chairman of Dowa shared that this was the driving force in the period when the solidarity of member enterprises supporting each other in restructuring production, supporting orders as well as legal raw materials.

Proposing the Government to remove difficulties.

On April 13, when working with Prime Minister Pham Minh Chinh, Viforest proposed urgent policies to overcome difficulties in the current period.

Accordingly, the Government, ministries, branches, and localities will soon allow the formation of regional and international exhibition centers. Beside Ho Chi Minh City with the relatively small scale, Hanoi, Da Nang as well as other key localities still have no ones. This is a limitation in promoting commercial products at present.

At the same time, ministries and branches support the wood and forest product processing and export industry to organize international fairs in the country to attract and promote products; increase the level of trade promotion support for Vietnamese enterprises to participate in international fairs because the current support policy is still low while the cost to participate is quite high. Trade counselors also need to regularly coordinate with industry associations and businesses to provide information on policies and markets in important countries and markets. Businesses also wish to extend their debt due from 6 to 12 months; have a special credit package from the Bank for Social Policies for businesses to borrow to pay wages for workers in 2023... These recommendations for the wood industry have been assigned by Prime Minister Pham Minh Chinh to the relevant ministries and branches to share and support businesses in a real and timely manner.

With Dong Nai, according to Vice Chairman of the Provincial People's Committee Vo Van Phi, in addition to solving market problems, the province will continue to support businesses in building sustainable raw materials. Accordingly, research appropriate solutions to change the approach according to the product chain, from creating raw material areas to exploiting, processing, consuming domestic products, and exporting.​