Vietnam’s Wood Products Industry Feeling the Pressure From War in Ukraine and Other Logging Issues

Vietnam is one of the world’s largest wood and furniture exporters. The country prospered during the COVID-19 pandemic, as overseas buyers spent their lockdown time renovating their kitchens and home offices.

This year, however, Vietnam’s fortunes have changed. According to customs data, between August and September alone, Vietnam’s wood products exports sank 21%, with more than a 14.6% drop in total shipments. As a point of reference, furniture exports were worth $7.3 billion in 2020, following behind only China and Germany, as reported by the Observatory of Economic Complexity.

Part of Vietnam’s issues stem from allegations of the country importing Chinese goods for re-export with “Made in Vietnam” labels, which began with the onset of the China-US tariff war in 2018. Now the war in Ukraine is fueling concern that sanctioned products from Russia may be routed through Vietnam, which continues to maintain a neutral position on the conflict between Kyiv and Moscow—just as it does with Beijing and Washington. Concern about the logging of fuel wood has added additional pressure.

The US Commerce Department has launched several probes into Vietnamese wood exporters over alleged illegal transshipments. A decision in one of those cases is due this month. Penalties typically include fines or import bans.

A further setback to Vietnam’s wood products industry came last week when the Forest Stewardship Council (FSC) removed a local company’s ethical sourcing certificate.

FEA compiles the Wood Markets News from various 3rd party sources to provide readers with the latest news impacting forest product markets. Opinions or views expressed in these articles do not necessarily represent those of FEA.