Enterprises proactively adapt to the impact of the Russia-Ukraine tension

Wood production is being affected by the tensions between Russia and Ukraine.

Exports and imports are suspended, imports is also meet with more difficulties, along with the chain effects that made businesses become worrying.

Exports was affected

Russia is a potential market for Vietnamese agricultural products both in terms of export and import. However, the tension between Russia and Ukraine has affected Vietnam's import and export activities with this type of market.

Earlier this year, Luong Gia Food Technology Joint Stock Company exported a number of orders of dried fruit to the Russian market. This is one of the leading enterprises in the production, distribution and export of dried fruit, fruit-based products instead of fresh fruits in the province area. The company's products are mainly tropical fruits and fresh fruits available in Vietnam such as mango, dragon fruit, guava, pineapple, passion fruit. Along with other markets such as Europe, Korea, and the Middle East, the proceeds of the sale in Russia are growing strongly. However, when the fighting between Russian-Ukrainian occurred, everything was changed. “Currently, we have been forced to suspend exports to the Russian market, even though this is one of the main markets. Payment of orders is also very difficult. If this situation keeps on, businesses do not know which direction to get away with it "- Mr. Ho Quoc Thai, director of the company, worried.

Similarly, Mr. Le Bach Long, Director of Nam Long Limited Company (specializing in producing rubber gloves) said that, in addition to the domestic and Asian markets, the business expands export markets to Europe, including Russia. The outbreak of the disease and now the war between Russia and Ukraine has affected businesses exporting to this market. “Our partners doing business with Russia are complaining. Nam Long has exported goods to Russia, but in recent months, the importer has not been contacted again. The Russian market is disturbed; the Ruble depreciates, causing international payments to be disturbed, "- Mr. Le Bach Long shared.

Businesses find ways to adapt

According to the Vietnam Wood and Forest Products Association, for the wood industry, Vietnam is a large furniture exporter, but it is highly dependent on imported raw materials. Currently, the two-way trade in the wood industry between Vietnam and Russia is strongly leaned towards importing wood materials. In addition, a much larger amount of wood from Russia is imported by Chinese enterprises and then sold to Vietnam, this source is hard to make statistics and analysis.

Russia has suspended the export of some forest products and wood products to some markets. The restriction and export ban by Russia caused a shortage in the market in terms of raw wood supply, while the demand for wooden furniture continued to increase, which drove the price of wood materials up. This creates fierce competition for raw materials in the world, so Vietnam's wood imports from other markets will also face difficulties.

As a major importer and supplier of wood materials for Dong Nai and the whole southern region, Tan Vinh Cuu Joint Stock Company has imported a significant amount of raw wood from Russia for many years. This enterprise is worried and tried to solve the problem. One of the solutions that this enterprise and the Dong Nai Wood and Handicraft Industrial Association are applying is to link domestic wood producers with farmers and afforestation establishments. The association, creating a sustainable supply of planted timber will gradually reduce pressure on imported timber.

In addition to being more proactive in preparing raw materials for production, businesses have focused on diversifying markets and finding solutions to overcome difficulties.

According to Mr. Nguyen Van Thu, Chairman of the Board of Directors of GC Food Joint Stock Company, the company's products have been presented in a number of key markets in Asia and Europe. Recently, the company's fruit and vegetable output to European countries has grown strongly. In addition to the previous markets, there have been a number of partners in Europe contacting businesses to find sources of Vietnamese agricultural products. This is a positive signal, creating conditions for GC to continue to expand and diversify export markets.

Vi Quan