PHOTOGRAPHY FROM VIFA 2018 Vietnam is benefitted by the China-US trade war, attracting
Material View: US-China War
international woodworking machinery makers to win the game
Hsu also shared his years of observation in global timber market. He said, we can realize the Vietnam furniture industrial dynamics through the perspective from material side. Rubber, pine, and aspen are popular for western countries. China, on the other hand, mostly import hardwood, for example walnut, ash, white oak, red oak. Hence, we can infer the destinations through species, grades, specification, thickness of timber factories procured. Due to US-China trade war, orders move from China to Vietnam, however, the increased demand for solid wood is less than 15%. One reason is Vietnam’s labor law rules the regulation of working time. Besides solid wood, the demand of panel, which mostly invested by Korean enterprises, have increased due to the trade war. Hsu said, even though the increased demand from Vietnam, raw material prices did not go high since the decreased demand from China. The reasons are tariff issue and also the problem from domestic house market. This year, we didn’t see China procuring as many rubber from Indonesia, Thailand, Malaysia, Vietnam as before, dropping the prices of rubber and pine, which is usually considered as the substitution of rubber.
Vietnam is Still the Largest Global Furniture Production Base Would Vietnam furniture industry move to other countries in Southeast Asia in the future? Hsu believed that the industry will not move out from Vietnam in at least 10 years. Looking at other countries nearby, Thailand has excessive labor cost, which is double that of Vietnam’s; Indonesia, as a Muslim country, has trade barrier issues in western countries; Myanmar, on the other hand, have electrical problem and low labor productivity. Thus, Hsu said, Vietnam will continue to be the main role of furniture production base in the world.