Wood companies in Nghe An receive export orders again

In early August 2023, at Thanh Chuong Wood Production and Trading Joint Stock Company (Thanh Huong commune, districtThanh Chuong), the atmosphere at the factory is quite bustling. Trucks transporting acacia wood in and out continuously, the yard is full of acacia wood, inside the factory, the production lines are actively operating to produce compressed pellets.

A representative of Thanh Chuong Wood Production and Trading Joint Stock Company said: From the end of 2022, exporting pellets to European, Korean and Japanese markets will be very difficult, and prices will decrease.

However, from the beginning of July 2023 until now, the Factory has found orders in Japan, selling over 11,000 tons of pellets, priced at 180 USD/ton. Currently, the Factory is continuing to seek additional orders to maintain production of 10,000 tons of products/month (equivalent to purchasing 24,000 tons of raw glue in Thanh Chuong district).

Mr. Tran Phi Hung - Head of the Department of Agriculture and Rural Development of Thanh Chuong District People's Committee said: Thanh Chuong district has over 20,000 hectares of raw acacia, annually harvesting 2,500-3,000 hectares of acacia. The fact that Thanh Chuong Wood Production and Trading Joint Stock Company has found export orders and operated stably continues to bring benefits to both acacia growers and the factory. After a long period of acacia "blocked" output, now that the factory is operating again, people have sold acacia to the factory at a price of 10.5-1.1 million VND/ton, which is already profitable.

Also at this time, at Song Hieu Agricultural Forestry Company Limited (Thai Hoa town), in the laminated wood processing factory area, workers actively packed goods to transport onto trucks for the purchasing unit.

Mr. Nguyen Ngoc Hoang - Chairman of the Board of Members of Song Hieu Agriculture and Forestry Company shared: At the end of June 2023, we had a large inventory of nearly 4,000 cubic meters of wood products, worth nearly 30 billion VND, the inventory was mainly laminated wood and wood blanks.

“Fortunately, since July 10, countries have had a need to buy again. We have found orders and sold them to wood chip purchasing units in the southern provinces. These units collect goods from everywhere and then export them to the US market. Currently, we have sold all the wood in stock, the wood processing factory is operating at 70% capacity, reaching a volume of 250 cubic meters of laminated wood per month. Thanks to the stable output, nearly 100 workers have jobs,” Mr. Hoang added.

Talking about the good news of returning orders, a representative of Nghe An PP Paper Materials Joint Venture Company Limited in Khanh Hop Commune (Nghi Loc) also expressed: Before June 2023, the factory had over 2,500 tons of wood chips in stock. But from the beginning of July 2023 until now, the export market has improved, the factory has cooperated with other wood chip processing units in other areas of the province, together collecting goods for export to China and South Korea with a volume of 8,000-10,000 cubic meters of wood chips. The price of wood chips has increased compared to the beginning of 2023, from 950,000 VND/ton, now increased to 1,050,000 VND/ton.

According to the Department of Industry and Trade, Nghe An currently has more than 45 wood processing enterprises, more than 100 non-timber forest products enterprises and more than 10,000 establishments producing and trading wooden furniture and non-timber forest products. In the first 6 months of 2023, orders from enterprises in the industry decreased by an average of over 50%.

However, since July 2023, businesses have begun to receive orders again, mainly exported to markets in Europe, Korea, Japan, etc. Especially now, the previous inventory of wood processing factories has basically been released, and the factories are operating again.

Mr. Nguyen Tien Lam - Vice President of Nghe An Wood and Non-Timber Forest Products Processing Association said: Although the wood industry has improved, businesses have found export orders, however the number of orders is not large, due to difficulties still affected by the economic recession. Therefore, wood businesses in Nghe An still have to proactively seek and expand markets, especially the domestic market.

In addition, businesses also need to improve their competitiveness, ensure product quality, and suit the tastes. Wood industry businesses need to focus on restructuring and reorganizing their production, focusing on technological innovation, improving production management systems, improving efficiency and quality of human resources to reduce costs.