Assessment of Vietnam's Wood Export in 2023

In the first 5 months of 2023, Vietnam's wood and wood product exports reached only 4.7 billion USD, marking a decrease of nearly 30% compared to the same period in the previous year. The wood industry is currently facing a very challenging time.

According to the press release by the Vietnam Timber and Forest Product Association, after several years of rapid growth, the total export value of wood and wood products in the first 5 months of 2023 amounted to 4.7 billion USD, a significant drop of nearly 30% compared to the same period in 2022. Particularly, processed wood products under HS code 94 saw a decline of up to 38%. At present, only some items under HS code 44 continue to experience positive growth.

Regarding specific items, in the first 4 months of 2023, the export of plywood, mainly produced from hardwood, to the United States decreased sharply due to the impact of an investigation by the U.S. Department of Commerce (DOC) conducted since mid-2021 to combat tax evasion and dumping. However, the export of plywood used in construction (film-faced plywood) to the markets of the United States and the EU increased.

During the first 4 months of 2023, the export value of fiberboard to the Indian market reached 21.19 million USD, a threefold increase compared to the same period in 2022 (7.6 million USD). Fiberboard now accounts for 47% of the total value of wood and wood product exports to India.

As for peeled veneer, its exports in the first 4 months of the year reached 69.4 million USD, a 9% increase compared to the same period in 2022. The main importing markets for this product, China (57.2 million USD) and Cambodia (3.4 million USD), also recorded growth rates of 1% and 20%, respectively, compared to 2022. Additionally, exports of peeled veneer to India surged from 284.5 thousand USD in the first 4 months of 2022 to 3.1 million USD in the same period of 2023.

Despite a significant decrease in the export price of wood chips compared to the end of 2022, Vietnam's wood chip exports in the first 4 months of 2023 reached over 4.1 million tons, with a value of 704.4 million USD, a 3% increase compared to the same period in 2022. China and Japan remain the main markets for Vietnamese wood chip exports, with China accounting for over 70% of the total.

The export of compressed wood pallets during the first 4 months of the year reached 1.2 million tons, with a value of 213.04 million USD, a decrease of 22% in quantity and 10% in value compared to the same period in 2022. Particularly, the export price of compressed wood pallets saw a sharp decline.

However, as assessed by the Vietnam Compressed Wood Member Association, it is expected that the demand for compressed wood pallets in the South Korean market will rebound in June and July, with a consumption volume of 100,000 tons per month. Meanwhile, Vietnamese businesses have secured long-term contracts of 2 to 3 years to supply compressed wood pallets to the Japanese market.

It can be observed that the two major import markets for compressed wood pallets from Vietnam, namely South Korea and Japan, account for 98% of the total volume and show promising signs.

The EU market seems to have stabilized after the energy supply crisis, including biomass supply. However, with strong commitments to reduce emissions and enhance the use of biomass, it is predicted that compressed wood pallet exports will recover both in terms of price and volume in the latter months of 2023.

Despite facing numerous difficulties, mainly from external impacts, the Vietnam Timber and Forest Product Association expects that with its prominent position in the global wood trade and the competitive capacity that has been tested along with the experience accumulated by Vietnamese entrepreneurs in the market, Vietnam's wood industry will soon regain its growth momentum as the global wood market recovers.

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