HAWA Vice President: Wood export in 2022 can reach nearly 17 billion USD

On the sidelines of the introduction of the International Industry Exhibition process the wood 2022 – Vietnam Wood 2022 on October 5, Mr. Nguyen Chanh Phuong, Vice President of Fine Arts Association and Mr Process the wood Ho Chi Minh City (HAWA), sharing 9 months, the export of wood and wood products reached 12.4 billion USD, up 11.4% over the same period in 2021. Particularly, the export value of wood products was estimated at 8, 6 billion USD, an increase of 2.4%.

September alone, worth wood export and wooden product was $1.25 billion, down 11% from August but up 76% over the same period last year. In which, the export value of wood products is estimated at 808 million USD, down 9% compared to August, but up 89% compared to September 2021.

Mr. Phuong forecast that in the last three months of the year, each month's turnover could reach 1.5 billion USD. Thus, the fourth quarter can reach about 4.5 billion USD, bringing the whole year accumulation to 16.9 billion USD, an increase of 14% compared to the previous year.

The Vietnamese manufacturing industry in general and the wood industry are at a limited manufacturing level.

Vice Chairman of the Ho Chi Minh City Handicraft and Woodworking Association (HAWA) mentioned that currently, the domestic supply of raw materials can only meet about 75% of the total processing demand, including plantation and mining. scattered crops, rubber wood. Each year, Vietnam has to import about 8.5 million m3 of wood.

Mr. Phuong mentioned a number of business groups that have used modern technology with mainly imported machinery to improve productivity and meet domestic and export demand. However, many devices in use have an average manufacturing year of 2010, which is quite old compared to today's devices. Using mechanics in wood mills is now commonplace, but automation is still a long way off. "Some businesses have advanced to smart factories," said Mr. Nguyen Chanh Phuong.

Mr. Nguyen Tuan Hong Phuc, executive member, Head of Customer Strategy and Supply Chain Consulting at KPMG Vietnam, shared about the story of the global integration manufacturing industry. According to Mr. Phuc, the manufacturing and wood industry in particular, integration into the global value chain consists of 4 levels.

The first level is goods (commodities). Exports of countries at this stage span the entire value chain and act as inputs to other countries' manufacturing industries.

The second level is limited manufacturing, that is, countries mainly focus on manufacturing industries that are labor-intensive and whose outputs require low technical complexity.

The third level is advanced manufacturing & services. Once at this level, countries mainly focus on advanced manufacturing industries that require complex manufacturing capabilities, supply networks, design and innovation, and technology application.

Level four is innovation activities. To this extent, countries at the advanced and innovative stages of the global value chain spend a large portion of their GDP on research and development and receive most of their GDP from intellectual property.

According to Mr. Phuc, Vietnam's manufacturing industry in general and the wood industry in particular are at level two. Vietnam is developing industrial infrastructure and supporting industries. Manufacturing industries participate mainly in the late stages of the production process, most of which are labor intensive and require low technical requirements.

Mr. Phuc said that when the manufacturing industry is globally integrated, higher profit margins come from more complex products and production stages with advanced technology application, high production capacity and management. The transition to a higher stage also opens up potential opportunities for businesses to grow further. In addition, businesses will grow and expand their ability to penetrate the market through diversifying the economy into new or adjacent industries.

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By: CafeBiz