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According to Huacheng's foreign trade import and export data, from April 2022, Vietnam's wood and wood products exports have shown signs of slowing down. As of June and July 2022, Vietnam's wood and wood products exports have maintained an average annual average of two After an increase of more than a few percent, the year-on-year declines were 11% and 5.5% respectively, showing a negative growth. Representatives of many woodworking companies and associations of the handicraft and wood industries expressed concern about the difficulties plaguing the wood industry.

Recently, orders have been cancelled or the number of reservations has been reduced, and some importers have asked to temporarily freeze their orders, although Vietnamese enterprises plan to continue to produce their products.

Some importers canceled orders without prior notice, while others kept orders in Vietnam and made excuses for delayed payments. Some importers have even cancelled orders when the product has already started production.

According to Huacheng's foreign trade import and export data, about 47 companies reported a decline in export orders. Among them, 14 companies face a 70-90% drop in orders, while 18 companies face a 30-60% drop. About 15 companies reported a 10-30% drop, and only 5 timber companies reported a 10-30% increase in export orders.

Due to the sharp drop in export orders, many wood processing companies have scaled down production, resulting in a large number of layoffs. About 65% of wood processing businesses have cut 20-50% of their workforce, and some businesses have reduced their workforce by 70% compared to pre-pandemic levels.

Mr. Nguyen, vice president of the Ho Chi Minh City Handicraft and Wood Industry Association (HAWA), pointed out that the main reason is that major export markets such as the United States and Europe are facing many difficulties due to the conflict between Russia and Ukraine. In addition, high inflation in many countries has caused consumers to retrench, resulting in less demand for unnecessary products, including wood products and furniture.

Another reason is that in the past period of time, there has been a lot of congestion of goods in warehouses and ports abroad and in Vietnam. It takes 3, 4 months or even 12 months to resolve commodity inventories.

In particular, the export of wood and wood products to the United States, Vietnam's largest export market for wood and wood products, has declined, affecting the industry's export turnover. In addition, the lumber industry is also facing a U.S. Department of Commerce (DOC) investigation into wooden cabinets and vanities, resulting in lower orders and high inventories.

According to the forecast of Vietnam's Ministry of Agriculture and Rural Development, the export value of Vietnam's timber and wood products will reach US$16.3 billion this year.