Woodwork Production Sector Targets US$1.5Bln in Export Turnover in 2005

Woodwork Production Sector Targets US$1.5Bln in Export Turnover in 2005

Vietnam’s woodwork production sector strives to reach an export turnover of US$1.5 billion this year, said Tran Quoc Manh, vice chairman of the HCM city Handicraft and Wood Industry Association.

Vietnamese woodwork is now exported to more than 120 countries, with Europe, Japan and the US being the main markets.

At present, 75 per cent of the wood processing businesses export their products directly without going through intermediaries.

Vietnamese woodwork is rated by many customers because it has better quality than that of Indonesia, the designs are more creative than those of China and prices are quite competitive.

There are now more than 1,200 wood processing factories in Vietnam, capable of processing 2 million cu.m of wood per year. More than half of them are in HCM city and neighboring provinces including Dong Nai, Binh Duong, Ba Ria – Vung Tau and Long An, accounting for 70 per cent of the wood processing capacity of Vietnam.

The massive development of wood processing factories, however, creates an imbalance between production demand and manpower supply.

The sector will need more than 25,000 new workers this year, according to Ministry of Trade. Moreover, there are no official training organisations for woodwork workers.

The volume of wood exploited from natural forests in Vietnam is only 500,000 cu.m a year, only sufficient for artistic woodwork. Therefore, 80 per cent of the wood needed must be imported. The price of imported wood has increased 10-30 per cent, but the price of export woodwork remains unchanged, putting businesses in a difficult position.

To develop sustainably, the wood processing industry is advised to study the possibility of developing concentrated wood processing complexes to foster alliances between businesses.

It should also build material markets to supply wood for businesses at the lowest price possible.

Vietnam woodwork industry began to pick up in 1997 and has had strong growth since 2000 with an annual average rate of 70 per cent. In 1999, the industry’s exports were US$208.8 million. The figure increased to US$561 million in 2003 and more than US$1 billion last year.
(Saigon Times Weekly)