Panels & Furniture Asia September/October 2024

Panels & Furniture Asia is a leading regional trade magazine dedicated to the wood-based panel and furniture processing industry. Published bi-monthly since 2000, Panels & Furniture Asia delivers authentic journalism to cover the latest news, technology, machinery, projects, products and trade events throughout the sector. With a hardcopy and digital readership comprising manufacturers, designers and specifiers, among others, Panels & Furniture Asia is the platform of choice for connecting brands across the global woodworking landscape.

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SEPTEMBER/OCTOBER 2024

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Nanxing CNC 6-Sided Drilling Macine Drilling Family & Solution CNC 6-Sided Drilling Macine Drilling Family & Solution Nanxing CNC 6-Sided Drilling Macine Drilling Family & Solution

Servo tracking

Up to 9 pcs/min

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ND712DP CNC 6-Sided drilling machine with double work station ND712DP CNC 6-Sided drilling machine with double work station ND712DP CNC 6-Sided drilling machine with double work station

ND712DP

ND712D is designed to have 2 independent work stations 1200+650mm by integrating 2 machines on one machine, thus double the efficiency with less space requirement compare. Integrated machine body structure of high rigidity offers the whole machine longer service life and stably fast processing. Optimized drill bits layout makes drilling more efficient. HIGHLIGHT ND712D is designed to have 2 independent work stations 1200+650mm by integrating 2 machines on one machine, thus double the efficiency with less space requirement compare. Integrated machine body structure of high rigidity offers the whole machine longer service life and stably fast processing. Optimized drill bits layout makes drilling more efficient. HIGHLIGHT ND712D is designed to have 2 independent work stations 1200+650mm by integrating 2 machines on one machine, thus double the efficiency with less space requirement compare. Integrated machine body structure of high rigidity offers the whole machine longer service life and stably fast processing. Optimized drill bits layout makes drilling more efficient. HIGHLIGHT

250-2500mm 50-1200mm(Left)/50-650mm(Right) 135/135/75/30m/min 10-60mm 3.5kw×4/18000RPM

250-2500mm 50-1200mm(Left)/50-650mm(Right) 135/135/75/30m/min 10-60mm 3.5kw×4/18000RPM 3.5kw×4/18000RPM

250-2500mm 50-1200mm(Left)/50-650mm(Right) 135/135/75/30m/min 10-60mm

Panel length Panel thickness Panel width Max. speed(X/U/Y/Z) Main spindle

Panel length Panel thickness Panel width Max. speed(X/U/Y/Z) Main spindle Main spindle

Panel length Panel thickness Panel width Max. speed(X/U/Y/Z)

Vert. drills qty (top/bottom)

Total power Rotation speed Vert. drills qty (top/bottom) Rotation speed Total power

Vert. drills qty (top/bottom)

19×4/9×2

19×4/9×2 5000RPM 43.86kw

Total power Rotation speed

43.86kw 5000RPM

Stuctural diagram of the upper processing unit of ND712DP

automatic width detection and compensation

2 sets 8-slot tool magzine of ND712DP

Layout of ND712DP

NDL2800 CNC 6-Sided drilling machine with double Work Station NDL2800 CNC 6-Sided drilling machine with double Work Station NDL2800 CNC 6-Sided drilling machine with double Work Station

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Double ND712DTL line

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Layout of double ND712DTL

HIGHLIGHT 1.Through the processing info read by auto label scanning system, boards can be HIGHLIGHT 1.Through the processing info read by auto label scanning system, boards can be HIGHLIGHT 1.Through the processing info read by auto label scanning system, boards can be

allocated to proper working station automatically; 2.Higher efficiency, up to 900 pcs/h for each shift; allocated to proper working station automatically; 2.Higher efficiency, up to 900 pcs/h for each shift; allocated to proper working station automatically; 2.Higher efficiency, up to 900 pcs/h for each shift;

3.Independent supervisor makes all boards’ processing status available at a glance; 4.Each machine can be used in line or individually, simplify the machines’ manage- ment or maintenance; 5.Modular design of such work cell is easy to link to sorting system or edge banding work station to build Industrial 4.0 production line. 3.Independent supervisor makes all boards’ processing status available at a glance; 4.Each machine can be used in line or individually, simplify the machines’ manage- ment or maintenance; 5.Modular design of such work cell is easy to link to sorting system or edge banding work station to build Industrial 4.0 production line. 3.Independent supervisor makes all boards’ processing status available at a glance; 4.Each machine can be used in line or individually, simplify the machines’ manage- ment or maintenance; 5.Modular design of such work cell is easy to link to sorting system or edge banding work station to build Industrial 4.0 production line.

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CNC 6-Sided Drilling Machine(Single Machine) Drilling Family CNC 6-Sided Drilling Machine(Single Machine) Drilling Family CNC 6-Sided Drilling Machine(Single Machine) Drilling Family

NCB612FT2 CNC 6-Sided drilling machine

ND510S CNC 6-Sided drilling machine with grooving

ND712DL CNC 6-Sided drilling machine with double work station ND712DL CNC 6-Sided drilling machine with double work station

ND712DL CNC 6-Sided drilling machine with double work station

CONTENTS

Contents Issue 5 / Panels & Furniture Asia September / October 2024

Panel Manufacturing 32 IMA Schelling: Solution provider for the final stages of panel production 35 New life for waste wood 38 Belt quality equals board quality 40 Imeas: Innovations in sanding CLT panels and glulam beams Furniture Manufacturing 43 Constant layer thicknesses with automatic control of the powder quality 45 In change, we grow 48 Excitech secures dealer in Vietnam Materials 50 The rich legacy and future of Quebec’s hardwood Flooring 52 Engineered Floors reinvents flooring with Hymmen Structural Elements 54 Timber cathedral uses unique structural system Sustainability 56 Addressing challenges in palm wood classification and certification Show Review 58 Hanoi Wood Expo 2024 62 Sylva Wood Expo 2024

Editor’s Note

10 66 68

News

Calendar of Events List of Advertisers

Market Report 16

Vietnam wood and wood products market performance in recovery 20 Upward trend: US hardwoods to South East Asia and Greater China Environmental Report 22 Music to my ears: Instruments made from wood, and on the legality of timber supply In Person 26 SCM’s customer-centric priorities Product Highlight 30 New high-production Wood-Mizer industrial sawmill

6 PANELS & FURNITURE ASIA | SEPTEMBER / OCTOBER 2024

FROM THE EDITOR

Slowly but surely, the South East Asian wood and woodworking industry is recovering. Better signs ahead In this issue, we have lots of interviews in store for you readers. One of them is with the new director for SCM’s Wood Division, Pietro Gheller (p.26). For Gheller, his approach to business decisions is simple, though difficult

Vietnam’s export of wood and wood products recorded a 22.7% year-on-year rise in H1 2024 to US$7.4bn (p.16). Malaysia, too, saw an increase: From January to May 2024, wood and wood products exports reached RM13.112bn (US$2.97bn), which is around 18% higher compared to the same period last year. The American Hardwood Export Council (AHEC) has also reported upticks in US hardwood exports to South East Asia and Greater China, with lumber exports to South East Asia increasing by around 24% year-on-year, amounting to nearly $63m (p.20). The road ahead is still plagued with challenges, however. Ahead of the implementation of the EU Deforestation-free Regulation (EUDR) and amid domestic challenges like increasing raw material prices and labour costs, many wood and woodworking businesses are still struggling to make ends meet, with some factories even closing down. Word on the street is that the market will fully recover to pre-pandemic times by next year, around Q2, but who knows if that will happen? For those optimistic, at least the current market conditions suggest better times ahead.

to pull off, especially in the short term: How to build long-term relationships with customers and build brand loyalty in a B2B environment? He weighs in his strategies. Another interview is with IMA Schelling, on what is a popular business segment for them in Europe and the US, though not as much in South East Asia: Their handling solutions for the wood panel industry (p.32). Armed with around 100 years of experience, IMA Schelling’s handling solutions have helped industrial-sized wood panel factories become more efficient, faster, and hands- free. How can they help Asia-Pacific? Other than interviews, we have interesting case studies for everybody, whether in the raw materials, furniture, or panels segment, to enjoy: IMAL PAL on their waste wood recycling capabilities (p.35); Schuler Consulting on how they helped furniture manufacturers of different segments increase productivity and efficiency (p.35); Peter Fitch from IOI Palm Wood on how, in James Yau • Assistant Edito r james@pabloasia.com Pang YanJun • Business Development Manager yanjun@pabloasia.com Goh Meng Yong • Graphic Designer mengyong@pabloasia.com Shu Ai Ling • Circulation Manager ailing@pabloasia.com

spite of palm wood’s sustainability credentials, they face issues in trade due to certification and compliance roadblocks (p.56); and many more.

Yap Shi Quan EDITOR

PABLO BEIJING Ellen Gao • General Manager pablobeijing@163.com PABLO SHANGHAI Daisy Wang • Editor pabloshanghai@163.net

PABLO SINGAPORE William Pang • Publisher williampang@pabloasia.com Yap Shi Quan • Editor shiquan@pabloasia.com Agatha Wong • Assistant Editor agatha@pabloasia.com

Pablo Publishing & Exhibition Pte Ltd (Head Office) 3 Ang Mo Kio Street 62, #01-23, Link@AMK, Singapore 569139 • Tel: +65 6266 5512 • Email: info@pabloasia.com Company Registration No: 200001473N • Singapore MICA (P) No: 043/12/2023 Pablo (Beijing) • Tel : +86 10 6509 7728 • Email : pablobeijing@163.com Pablo (Shanghai) • Tel : +86 21 5238 9737 / 36 • Email : pabloshanghai@163.net

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All rights reserved. Views of writers do not necessarily reflect the views of the Publisher. No part of this publication may be reproduced in any form or by any means, without prior permission in writing from the Publisher and copyright owner. Whilst every care is taken to ensure accuracy of the information in this publication, the Publisher accepts no liability for damages caused by misinterpretation of information, expressed or implied, within the pages of the magazine. All advertisements are accepted on the understanding that the Advertiser is authorised to

publish the contents of the advertisements, and in this respect, the Advertiser shall indemnify the Publisher against all claims or suits for libel, violation of right of privacy and copyright infringements. Panels & Furniture Asia is a controlled-circulation magazine with six issues a year. It is mailed free-of-charge to readers who meet a set of criteria. Paid subscription is available to those who do not fit our terms of control. Please refer to subscription form provided in the publication for more details. Printed by Oxford Graphic Printers Pte Ltd

8 PANELS & FURNITURE ASIA | SEPTEMBER / OCTOBER 2024

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NEWS

Smart Furniture Solutions Vietnam returns for the fifth edition Organised by Binh Duong International

Furniture Association (BIFA) JSC, Vietnam Confederation of Commerce and Industry (VCCI), and Pablo Publishing & Exhibition, the Smart Furniture Solutions (SFS) Vietnam 2024 will take place from 27-30 Nov 2024 at WTC Expo Binh Duong International Exhibition Centre. After four successful seasons, SFS Vietnam 2024 returns to one of the busiest furniture centres in Vietnam, Binh Duong, introducing advanced solutions in the field of digital technology and smart manufacturing, helping to increase speed, efficiency and quality in the furniture production process. Through the exhibition, businesses will gain deep, practical insights of Industry 4.0 and explore automated technologies in the production process of panel furniture, solid wood furniture, wooden boards, doors and floors, and more. The wood and woodworking trade exhibition is expected to gather nearly 300 booths of more than 180 exhibitors from countries and territories with more than 10,000 visitors. The exhibition aims to bring opportunities to Vietnam’s furniture manufacturing industry, and hopes to continue developing and make a mark in the domestic and international markets. Binh Duong is an ideal meeting place for Vietnamese furniture brands to connect, exchange and cooperate with potential partners, to expand business networks and increase sales. To boost such networking opportunities, SFS Vietnam 2024 will also organise seminars and specialised events, helping businesses exchange and connect to learn in-depth experiences from experts and successful businesses in the industry. The main exhibition products at SFS Vietnam 2024 are diverse, including five main categories: raw materials such as solid wood, wood panels, veneers, and cladding; woodworking tools such as saws, blades, hand tools; machinery and equipment including CNC machining centres, edgebanders, drillers,

Tran Ngoc Liem, general director of Vietnam Chamber of Commerce and Industry – HCMC Branch (VCCI-HCMC), speaking at SFS Vietnam 2024 press conference

tenoners, sanders; surface treatment and finishing chemicals like adhesives, resins, paints, coatings; and lastly — adhering to the show’s raison d’etre — computer technology such as IoT solutions, furniture design software for CAD/CAM, MES, ERP, automation systems, among others. WHY SMART SOLUTIONS The first half of 2024 for Vietnam saw an increase of 22.1% in wood and wood products exports to around US$5 billion compared to last year. The main export groups are the US, Europe, and China. As of July 2024, wood and wood products export reached US$9.36bn, hitting around 60% of the industry’s export target for the year. In spite of the positive signs, challenges will continue to plague Vietnam’s furniture industry. Amid global political strife that will disrupt the

economy, the industry also faces domestic problems, including rising labour costs from not only increased minimum wage, but also because of the furniture industry competing for manpower with the electronics industry. “It has been proven that using Industry 4.0 solutions, such as automated machinery and digital software, can substitute around 45% of repetitive, manual labour, thereby increasing productivity by at least 30-40%,” said William Pang, managing director of Pablo Publishing & Exhibition, and co-organiser of SFS Vietnam 2024, during the exhibition’s press conference in Ho Chi Minh City, Vietnam. “This means higher output and quality at a shortened production time. Labour costs have also been increasing, leading to a shortage of labour — which can be solved with semi automation, replacing two to three persons with just one machine.” P

10 PANELS & FURNITURE ASIA | SEPTEMBER / OCTOBER 2024

NEWS

New study explores effects of Russia-Ukraine war on global wood trade A new study in Forest Policy and Economics

journal explores the short- and long-term effects of the Russia-Ukraine war on the global forest products trade. Conducted and written by Prakash Nepal, Austin Lamica, and Rajan Parajuli, the study indicated that in the short term, prices for industrial roundwood and finished wood products might increase by up to 3%, but in the long term, the Russian markets for industrial roundwood and sawnwood might recover to pre-invasion levels. Even then, the Russian and Ukrainian markets for wood-based panels and papers will undergo major and permanent structural changes within the next 30 years. Russia invaded Ukraine back in February 2022, and several European countries and the US have imposed sanctions on Russia, including on forest products. In July 2022, the same few countries implemented a ban on Russian wood imports, conferring the status of ‘conflict timber’ onto Russia’s lumber. ‘Conflict timber’ has been defined by multiple forest organisations, such as the Programme for the Endorsement of Forest Certification (PEFC) and Forest Stewardship Council (FSC) as timber “traded at some point in the chain of custody by armed groups”. The authors’ methodology was to compare “the projected outcomes from the Global Forest Products Market (GFPM) model simulations for a reference (no invasion) scenario with an alternate scenario, where trade flows of all wood products were restricted from and to Russia as well as Ukraine by a varying degree of magnitudes (33% to 95%) between 2021 and 2025”. The analysis can reportedly “provide nuanced perspectives to forest managers, supply chain businesses, and policy makers”. P

Image: Unsplash

SEPTEMBER / OCTOBER 2024 | PANELS & FURNITURE ASIA 11

NEWS

Global legal and sustainable timber forum returns in september 2024

The Global Legal and Sustainable Timber Forum (GLSTF) 2024 is back from 11-12 Sep 2024 with the theme of “Together Towards Reliable and Effective Global Timber Supply Chains”. Organised by the Secretariat of the Global Green Supply Chains Initiative (GGSC) and jointly hosted by the International Tropical Timber Organization (ITTO) and the Commerce and Investment Promotion Institute of the Macao SAR (IPIM), GLSTF aims to build legal and sustainable supply chains within the timber and forestry industry. Recent development shows that the timber industry needs to collaborate more closely among stakeholders including timber producers, buyers, processing industry and market players nationally and internationally, to address issues in global timber supply chains arising from the post- pandemic and other uncertainties. There should be a platform to bridge the widening gap between demand and supply for wood products. As such, GLSTF strives to strengthen support for sustainable forest management and the uptake of legal and sustainable wood product supply chains, with the end goal of facilitating the legal and sustainable use and trade of wood products in a stable, transparent and predictable business environment while contributing to sustainable development and climate- change mitigation.

One of the forums during GLSTF 2023 (Image: GGSC)

with over 700 participants from 36 countries. This edition will be held in Macau as well, at the MGM COTAI. There will be two types of forums: The main forum, on Day 1, which is on the Global Legal and Sustainable Timber Forum itself, and four specialised sub- forums on selected topics on Day 2. The main forum will discuss the following topics: Session 1 on restoring reliable and stable supply of timber resources, with information on the European Deforestation-free Regulation (EUDR), on certifications, and more; followed by Session 2 on enhancing trust and effectiveness in timber supply chains; and ending the day with Session 3 on revitalising global timber supply chains.

order of the day: timber legality and sustainability; resources, markets and trade of legal and sustainable timber; advanced technology and machinery for wood processing; and global forest sustainability and supply chain finance. The forums will reportedly feature simultaneous interpretation in Chinese (Mandarin), English, French, Spanish and Portuguese. On top of the forums, GLSTF 2024 will announce the achievements of the Global Timber Index (GTI) and the Blockchain-based Timber Tracking System (BTTS). It will also host B2B matchings and other business side events to enhance networking, collaboration, and business exchange among timber industry stakeholders, be it producers, buyers, processors and market players.

The four sub-forums will explore the following topics in chronological

The inaugural edition of GLSTF in 2023 was held in November, in Macau,

Visitor registration is open now. P

12 PANELS & FURNITURE ASIA | SEPTEMBER / OCTOBER 2024

NEWS

Sunds Fibertech signs first reference in Thailand with S Kijchai Enterprise

Sunds Fibertech has announced that they will be supplying two of their MDF technologies to Thai panel producer S Kijchai Enterprise. More specifically, the provider of process and modernisation technologies for the panel industry will deliver their ‘Scorpion’ MDF Dryer and the latest generation of SundsZifter to process rubberwood. The MDF Dryer will ensure energy efficient drying of up to 56 tonnes of fibre per hour, while the SundsZifter will clean the fibre flow from latex particles and other impurities prior to entering the forming and press lines.

According to Sunds Fibertech, the project started in February 2024 when S Kijchai’s board of directors gave the green light to build the company’s third MDF line. With this project, the company aims to double its MDF capacity from 500,000m 3 to 1,000,000m 3 per year. “S Kijchai has over a decade of experience in processing rubberwood. We are proud to have convinced them of the value of our Dryer and Zifter package, which includes our updated and upgraded Zifter system,” said Marcus Mattsson, sales director of Asia-Pacific, Sunds Fibertech.

“The increased cleaning efficiency, compared to other solutions on the market, will give S Kijchai an competitive advantage among other MDF producers in the region.” “We would like to thank Sunds Fibertech for their commitment to the project and the detailed consultancy during the technical discussions”, said Harnsiri Sangwongkit, senior vice-president of S Kijchai Enterprise. “With this spirit of partnership, we look forward to execute the project together with Sunds Fibertech.” P

SEPTEMBER / OCTOBER 2024 | PANELS & FURNITURE ASIA 13

NEWS

Egger Group closes FY2023/24 year with €4.13bn turnover

The Egger Group has announced their performance for FY2023/24, closing out the financial year with a turnover of €4.13bn, an achievement considering the economic downturn. The group also generated an EBITDA of €493.6m. Other achievements that the group has managed this financial year was a 22nd plant in Markt Bibart, Germany, a minority stake in the Thai wood-based material manufacturer Panel Plus, and establishing a pioneering climate strategy with its commitment to the Net Zero objective by 2050. “We are not entirely satisfied with the results. At the same time, we are proud that we have been holding our own in this very difficult environment,” said Thomas Leissing, CFO of Egger Group, and speaker of the group management. “We are clearly focused on the future and are delighted to have been able to initiate far-reaching strategic developments. Thanks to our very solid financial basis and long-term strategy, even considering the fragile market situation, we are taking steps towards growth, and are growing despite the market situation.” In spite of the high figures, Egger’s turnover was 7.1% lower than the year before, and their EBITDA was 18.1% lower too. In FY2023/24, the group produced 10.4 million cubic metres worth of wood-based materials and timber. Their previous year was 9.6 million. The effects of the overall economic slowdown were felt to slightly differing degrees in the individual product areas. “People in the vast majority of our markets have to deal with high inflation, the higher cost of living and more difficult construction conditions. All of this has led to a low propensity to consume and significant decline in construction permits — and ultimately to

Egger Group Management (Image: Egger)

“We have set ourselves the ambitious net zero target. As for milestones, we have established pioneering climate targets for 2030. Measures are being implemented step by step and in close cooperation with our partners,” said Hannes Mitterweissacher, CTO of Egger Group. The overall economic outlook remains extremely cautious, characterised by fragile markets, the resulting price pressure and geopolitical crises, such as, the ongoing Russia-Ukraine conflict, hyperinflation and drastic market slump in Argentina as well as the conflict in the Middle East. The turnover and earnings expectations for Egger’s FY2024/25 are therefore correspondingly cautious. “Nevertheless, we are very well positioned for this period of downturn. We have a solid financial basis, a long-term, sustainable strategy, successful partnerships with our customers and suppliers and, above all, the best employees. Our sincere thanks go to our more than 11,000 employees, whose daily commitment makes all the difference. Our global team also knows how to turn a crisis into an opportunity,” said all members of the Egger Group Management. P

a low demand for our products,” said Michael Egger Jr, CSO of Egger Group.

Market and price pressure was considerable in the Building Products segment. Unconsolidated turnover in this product area fell by 22% to €704.9m. In the Decorative Products segment, the plants in Western and Eastern Europe have been well utilised. However, the situation in the core markets in Central Europe has been challenging, with the German-speaking region particularly experiencing extremely high market and price pressure. Since the beginning of 2024, the introduction of the new EGGER Decorative Collection 24+ has reportedly provided positive momentum and positive levels of new incoming orders. The Decorative Products segment generated an unconsolidated turnover of €3,629m, 3.8% lower than the previous year. In terms of sustainability, the group is currently implementing investment projects which contribute to this climate protection commitment, as part of their net zero target by 2050.

14 PANELS & FURNITURE ASIA | SEPTEMBER / OCTOBER 2024

NEWS

Andritz to supply “first fibreboard recycling line” to Sonae Arauco

International technology group Andritz has received an order to supply a dry fibreboard recycling line to Sonae Arauco’s mill in Mangualde, Portugal. The line will recycle end-of-life fibreboards back into valuable fibres as new raw material for fibreboard production. It will reportedly be the first industrial-scale fibreboard recycling line in the world, as claimed by Andritz. Paulo Pinto De Sousa, director at Sonae Arauco, said: “Recycling fibreboards is an important step towards a circular economy. It reduces the consumption of natural resources and

Sonae Arauco’s mill in Mangualde, Portugal, will reportedly be the first one worldwide to have a fibreboard recycling line (Image: Andritz)

energy. We know Andritz as a strong supplier of solutions for the fibreboard industry and are convinced that they are the right partner for our innovative fibreboard recycling project.” The dry fibreboard recycling line is based on continuous steam treatment with a special discharging system using the Andritz Steam-Ex discharger, which minimises steam consumption and maintenance requirements. This allows continuous processing of fibreboard material with low steam consumption and high runnability.

Michael Frint, technology director at Andritz, added: “By combining our proven pressurised refining systems with Andritz Steam-Ex, our pre-treatment process based on steam explosion, we have developed an efficient solution for fibreboard recycling. We are proud that Sonae Arauco placed their trust in us to build world’s first industrial-scale fibreboard recycling line.”

Start-up of the fibreboard recycling line is scheduled for Q2 2025, according to Andritz. P

SEPTEMBER / OCTOBER 2024 | PANELS & FURNITURE ASIA 15

MARKET REPORT

Vietnam wood and wood products market performance in recovery

domestic enterprises in total exports rose from 26.7% in the same period last year to 27.8%. The proportion of FDI enterprises decreased from 73.3% to 72.2%. With the strong recovery of exports, the demand for imported raw materials for production activities also increased in H1 2024, estimated at $180.16bn, an increase of 18.1% over the same period in 2023. The trade balance of goods in H1 continued to have a surplus, with an estimated trade surplus of $9.31bn. In general, against the background of improving global trade with Vietnam, Vietnam’s commodity exports are expected to continue to grow in the future. In addition, according to cyclical factors, orders are expected to increase sharply in the last few months of this year. In recent months, the import of raw materials for production has increased, which also indicates that the export will continue to grow in the future and will also be a factor to promote the national economic growth. In a recent report, the International Monetary Fund (IMF) predicted that Vietnam’s economic growth would reach nearly 6% in 2024 with the support of strong international demand, stable foreign investment and regulatory policies. OVERVIEW OF WOOD AND WOOD PRODUCTS EXPORTS IN H1 In June 2024, Vietnam’s wood and wood products exports reached $1.25bn, down 1.1% from May 2024, but up 13.6% from June 2023. The export of wood products is expected to reach $840m, up 0.6% from May 2024 and 10.4% from June 2023. In the first six months of 2024, the export of wood and wood products is expected to reach $7.4bn, an increase of 22.2% over the same period in 2023. The export of wood products is expected to reach $5.03bn, an increase of 21.4% over the same period in 2023. According to preliminary statistics, from 18- 25 Jun 2024, Vietnam’s exports of wood and wood products reached $361.8m, an increase of 12.3% over last week. The export of wooden furniture reached $217m, an increase of 14.3% over last week. It is estimated that in H1 2024, the export of wood and wood products will increase by double digits.

Vietnam’s Ministry of Industry and Trade published its trade information newsletter on 1 Jul, detailing specialised trade information on wooden products and handicrafts. Ahead of its 5th edition from 27-30 Nov 2024 in Bình Dương, Vietnam, the Smart Furniture Solutions (SFS) Vietnam wood and woodworking exhibition has summarised the salient trends and performances of wood and wood products in Vietnam from the newsletter:

same period in 2023. The export volume is expected to reach $33.2bn, an increase of 10.9% over June 2023, while imports are expected to reach $32.5bn, an increase of 21.9%. In H1 2024, the total import and export volume is expected to reach $369.64bn, an increase of 16% over the same period of last year. Vietnam’s commodity exports recovered strongly, with an estimated export value of $189.48bn, an increase of 14.2% over the same period last year. Compared with the same period of previous years, this has also set a record high. It is worth noting that the export volume of Vietnam’s domestic economic sector is expected to reach $52.74bn, an increase of 19.2% over the same period of last year. The growth rate is 12.3% higher than that of foreign-invested sectors, reaching $136.73bn. Therefore, the proportion of

GENERAL PERFORMANCE OF VIETNAM’S IMPORTS AND EXPORTS

At present, Vietnam’s economy continues to show positive signs, and its import and export activities remain active. It is estimated that it will maintain double-digit growth in H2 2024. In June 2024, the total import and export volume of Vietnam is expected to reach US$65.7bn, an increase of 11.6% over the

16 PANELS & FURNITURE ASIA | SEPTEMBER / OCTOBER 2024

MARKET REPORT

force, abundant wood raw materials, legally imported wood, and the ability to produce products that can be traced back to its origin. Moreover, Vietnam’s product design patterns are becoming more and more diversified. The export of wood and wood products still expects to face challenges in H2. Continued geopolitical tensions is expected to continue pushing up freight rates. In addition, wood and wood products exported to major markets such as the US and the EU continue to face pressure from trade defence investigations, environmental-related technical obstacles, sustainable development and green transformation. Specifically, from the end of 2024, Europe will implement laws and regulations to prevent forest deforestation. The US market will also implement anti- dumping regulations and investigate kitchen cabinets. In addition to objective factors, the internal ability of enterprises is limited, and most enterprises mainly process according to the orders and designs of foreign distributors.

Export situation of wood and wood products of Vietnam through the months of 2022 - 2024 (Unit: million USD)

1,900

1,600

1,300 1,000

700

400

100

T01

T02

T03

T04

T05

T06

T07

T08

T09

T10

T11

T12

2022

Source: General Department of customs – estimated data for June 2024

Vietnam’s export trade continues to show a positive trend, and the import of consumer goods in many countries has increased again, which is a good sign for the export of commodities such as wood and wood products. So far, many enterprises have received orders before August 2024, and some enterprises have even received orders before the end of 2024. With the arrival of many orders, and the positive growth data in H1 2024, the import of raw materials

increased, indicating that the export prospects of wood and wood products will grow in H2. Especially in the last few months of 2024, the demand for wooden furniture will usually increase as the real estate market enters the completion stage, and it is necessary to renovate houses and replace furniture to welcome the new year.

At the same time, Vietnam’s wood processing and export industry has a skilled labour

SEPTEMBER / OCTOBER 2024 | PANELS & FURNITURE ASIA 17

MARKET REPORT

Wood and wood productsexported in May and the first 5 months of 2024

Production and export have continued to grow for many years, but the added value of products is not high by relying on cheap labour and raw materials. Most enterprises are small in scale and unable to establish brands, with poor resilience to unexpected and persistent fluctuations in the market. Products are rarely distributed directly to customers, but must be distributed through foreign distribution channels. To make the wood industry sustainable, Vietnam’s wood and furniture industry needs to focus on investing in design, innovation, and increasing the added value of products, in addition to meeting the regulations and standards of origin and environment. Moreover, wooden furniture export enterprises need to diversify the market, focusing on promoting trade in potential markets such as the Middle East, Africa, Eastern Europe and Northern Europe, which have not yet been developed. In terms of products, most wood and wood products enjoyed growth in the first five months of 2024, especially for wooden furniture products. The highest export turnover is wooden frame chairs, reaching $1.3bn, with a year-on-year increase of 27.1%; followed by woodchips reaching $1.1bn, an increase of 35.1%; living room and dining room furniture reaching $1bn, an increase of 38.2%; wood, planks and flooring reaching $814.7m, an increase of 24.7%; bedroom furniture reached $772.7m, an increase of 32.3%. The US, China and the EU are all growing strongly, indicating that the market demand is recovering. The US is still Vietnam’s largest export market for wood and wood products, and its export turnover in the first five months of 2024 reached $3.3bn, an increase of 26% over the same period in 2023. The US is the largest import market in the world. It is worth noting that since 2023, the relationship between the two countries has been upgraded to a comprehensive strategic partnership, which has promoted two-way trade.

Proportion (%)

Compared to the same

5 months 2024 (thousand USD)

Compared to May 2023 (%)

May 2024 (thousand USD)

Product

5 months 2024

5 months 2023

period in 2023 (%)

Total

1,263,772

19.4 6,174,054

24.2

100.0

Wood frame chips

259,114

12.7

1,315,950

23.9

21.3

Wood chips

264,355

96.9

1,115,759

35.1

18.1

16.6

Living room and dining room furniture

204,080

93.3

1,034,087

38.2

16.7

15.0

Exports of rattan bamboo, sedge, and mats increased by nearly 13% in the first half of 2024 20

193,347

27.7

814,700

24.7

13.2

13.1

Bedroom Furnitrue

158.392

51.8

772,726

32.3

12.5

11.7

Kitchen Furniture

117.941

17.2

528,377

25.3

8.6

8.5

Percentage (%)

Compared to the same

5 months 2024 (thousand USD)

Compared to May 2023 (%)

May 2024 (thousand USD)

Items

5 months 2024

5 months 2023

period in 2023 (%)

Laminated Wood

48.382

11.4

281.714

10.1

4.6

5.1

Office Furniture

23.410

5.8

114.371

15.3

1.9

2.0

Wooden Doors

4.568

16.4

22.420

43.8

0.4

0.3

Handicraft Furniture

2.717

37.2

13.627

41.6

0.2

Mirror Frames

144

-24.1

891

-25.0

0.0

Source: Preliminary statistics from data of the General Department of Customs Regarding export markets: Wood and wood products exported to major markets such as

Export of wood and wood products to markets in May and the first 5 months of 2024

Percentage (%)

Compared to the same

5 months 2024 (thousand USD)

Compared to May 2023 (%)

May 2024 (thousand USD)

Market

5 months 2024

5 months 2023

period in 2023 (%)

Total

1,263,772

19.4 6,174,054

24.2

100.0

USA

676.712

7.6

3.335225

26.0

54.0

53.2

China

216.365

107.6

887.849

51.2

14.4

11.8

Japan

128.618

5.1

674.147

-0.5

10.9

13.6

South Korea

61.519

11.7

312.711

-3.8

5.1

6.5

European Union

34.808

18.7

240.325

32.8

3.9

3.6

France

6.549

-8.4

48.062

14.2

0.8

Germany

5.336

45.5

39,365

43.2

0.6

In addition, the exchange rate difference between VND and the USD has decreased, but it is still high. Therefore, due to the low labour cost, exporting wood and wood products from Vietnam to the US has a price advantage. Although there are advantages to exporting wood and wood products to the US, the risk of trade fraud and counterfeit product sources is increasing. Complex trade competition is also a major challenge for Vietnamese wooden furniture export enterprises. Therefore, Vietnamese enterprises must pay attention to improving product quality and labour productivity, apply digital economy to directly contact with imported enterprises, reduce procedures and costs, and thus improve product competitiveness.

Vietnam exported $887.8m to the China market, an increase of 51.2% over the same period in 2023. For the EU, it reached $240.3m, an increase of 32.8%. Canada reached $94m, an increase of 24.1%, while the UK reached $89.7m, an increase of 18%, and Indonesia reached $77.8m, an increase of 102.3%. OVERVIEW OF WOOD AND WOOD PRODUCTS IMPORTS IN H1 According to preliminary statistics, Vietnam’s import of wood and wood products in June 2024 is estimated to reach $250m, an increase of 0.9% compared to May 2024 and an increase of 31.3% compared to June 2023. In H1 2024, the import of this item is estimated to reach $1.27bn, an increase of 21.7% compared to the same period in 2023.

18 PANELS & FURNITURE ASIA | SEPTEMBER / OCTOBER 2024

MARKET REPORT

Export situation of wood and wood products of Vietnam through the months of 2022 - 2024 (Unit: million USD)

In H1 2024, the import of raw wood is estimated to reach 2.5 million cubic metres, valued at $838.4m, an increase of 18.4% in volume and 11.2% in value compared to the same period in 2023. In the first five months of 2024, the import of raw wood reached 2.02 million cubic metres, worth $670m, up 17.1% in volume and 8.4% in value compared to the same period in 2023. In the first five months of 2024, the import volume of raw wood from major markets such as China, EU, US, Thailand, Chile, Laos, Brazil, New Zealand, and others, increased compared to the same period in 2023. Specifically, the import of raw wood from the largest market, China, accounted for 17.3% of the total import volume in the first five months of 2024, reaching 348,5000m³, worth $137.1m, up 71.6% in volume and 39.9% in value compared to the same period in 2023. The import of raw wood from the EU market increased by 4% in volume and 9.3% in value compared to the same period in 2023, reaching 275,300m³, worth $88.6m, accounting for 13.7% of the total import volume. The import of raw wood from the US market increased by 18.1% in volume and 18.2% in value compared to the same period in 2023, reaching 255,4000m³, worth $110.1m, accounting for 12.7% of the total import volume. Meanwhile, the import volume from some other markets. For instance, Cameroon decreased by 35.6%; Malaysia decreased by 12.9%; Congo decreased by 32.5%; Suriname decreased by 28%; and Indonesia decreased by 6.6%. In the first five months of 2024, the import volume of major wood species such as pine, eucalyptus, pachyloba, oak, cajuput, walnut, xoan, and beech increased compared to the same period in 2023. Meanwhile, the import volume of some species decreased, such as ash, rubber, teak, among others.

250

200

150

T01

T02

T03

T04

T05

T06 T07 2023 2024

T08

T09

T10

T11

T12

Source: Calculated from data of General Department of Customs - estimated in June 2024

Export of wood and wood products to markets in May and the first 5 months of 2024

Compared to the same period in 2023 (%)

First 5 months of 2024