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Russian birch was found to violate the "sanctions" again and exported to Huacheng

2022-10-26

According to the Huacheng Import and Export Data Observation Report, earlier, the Timber Trade Federation (TTF) said that the raw material of hardwood plywood exported from China to the UK was birch from Russia, which violated the UK's "trade ban" on Russian products. Recently, Environmental Research Agency (EIA), a non-profit monitoring organization, released a report: after the ban on the import of Russian timber, birch from Russia entered the American market with the label of Asian products. This is the second time since the Russian Ukrainian incident that Russian timber has been found to be exported through the Chinese market.

According to Huacheng's import and export data observation report, it was reported that although many countries have successively imposed "trade restrictions" on Russia after the Russia Ukraine incident, Russia has begun to turn to the Asia Pacific market, so the overall impact is not significant. At present, China is still the largest timber exporter of Russia, and the birch in China's timber market basically comes from Russia.

According to the import data of Vietnam Customs, about 40000 cubic meters of birch wood is transported from Russia and China to Vietnam every month. Some furniture and plywood exported to the United States are made of Russian birch wood. Under the background of "trade restrictions", the raw materials of these products are first transported from Russia to China, then processed in China and exported to Vietnam. Finally, their raw materials enter the American market with the label of "Chinese products", Huacheng Import and Export Data Observation Report.

As soon as this incident occurred, Vietnam's timber market had another risk. In February 2020, the United States Hardwood Plywood Fair Trade Alliance applied for an investigation, saying that the plywood and furniture exported from Vietnam to the United States used hardwood plywood from China. If it was determined, the relevant Vietnamese furniture manufacturers would have to pay 183.36% AD tax and 194.9% CVD tax. After two years, the final conclusion of the investigation announced that the event had been postponed for the fourth time. Before the final conclusion was reached, 80% of Vietnam's exporters needed to participate in self certification in order to ship their products to the U.S. market. This event has had a considerable impact on Vietnam's timber market, Huacheng Import and Export Data Observation reported.

In the context of high global inflation, transportation costs have increased, and countries have begun to slow down their timber imports. The Vietnam Wood and Forest Products Association and local associations show that in 2022, orders of up to 80% of Vietnam's timber processing enterprises will decrease by 44.4%, orders of individual enterprises will decrease by 100%, and the income of enterprises will decrease by 30% or more.

As for the fact that some raw materials for Vietnam's products came from "restricted" Russia, EIA spokesman Thomas Zhang stressed that this violated not only Vietnam's relevant systems, but also the trade rules of the United States. Whether Vietnam's wooden products will be exported to the United States in the future will decrease or become more difficult is still unknown, Huacheng Import and Export Data Observation Report.


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