In 2025, Vietnam’s wood industry is targeting $18-18.5 billion in total export value, up 10-15 per cent on-year.

Photo: baodautu.vn

In a talk with VIR, Ngo Sy Hoai, vice chairman of the Vietnam Timber and Forest Products Association (Viforest), revealed that under normal conditions, the goal would be achievable. However, in the current context of global trade turbulence, it is hard to determine whether the target will be realised.

US President Donald Trump recently instructed the Department of Commerce to investigate under Section 232 of the 1962 Trade Expansion Act regarding wood and wood products. This could result in tariffs of up to 25 per cent on sawn wood and forestry products, effective as of April 2.

The US is accounts for over half of Vietnam’s wood exports, primarily furniture, interior and exterior wood products, carpentry, and refined products, with some plywood, laminated boards, and several other products also being exported.

Hoai noted, “In light of these changes in tax policies, Vietnamese wood businesses are on tenterhooks about the impact on Vietnam’s wood export performance.”

Huynh Quang Thanh, chairman of Hiep Long Fine Furniture Company, noted that the US has recently announced the imposition of countervailing tariffs on all goods imported from India, which will take effect from April 2. This raises concerns that President Trump may impose similar tariffs on Vietnam’s wood industry.

“If the US imposes a 25 per cent countervailing tariff on Vietnam’s wood industry, it could badly affect domestic companies, including Hiep Long. We have just received orders through April,” Thanh said.

As of now, many businesses are reporting confirmed orders until April-May, with lower production volumes compared to the same period last year.

The reason is that US buyers are hesitant, fearing that tariffs would lead to inventory build-up, they therefore have not finalised orders.

In response, Viforest and businesses in the sector have been preparing to participate in hearings if the US requests proof that the trade relationship between Vietnam and the US in the wood sector is mutually beneficial.

In this respect, Hoai argued, “We do not compete or disrupt US production. Vietnam not only exports to the US but is also the second-largest market in the world, after China, for the consumption of US’ logs and sawn timber.

The imported wood volume is used to meet domestic demand, and it is also processed and exported to various markets. Many products using US wood are also exported back to this country. This is a mutually beneficial trade relationship that adds value for both sides.”

Amid reduced buyer confidence due to market tensions, Hiep Long is striving to expand into new markets, including the Middle East- a promising market with an increasing number of resort projects.

Hiep Long has secured a few orders in this market, and the company is focusing on participating in international trade fairs to promote and directly reach Middle Eastern customers.

“We hope the government will reduce import taxes on US furniture to zero per cent to mitigate risks in the forthcoming period,” Thanh proposed.

Sharing the difficulties of the wood industry, Do Ngoc Hung, trade counsellor and head of the Vietnam Trade Office in the US, noted, “The biggest challenge right now is that Vietnam is not yet considered a fully market-oriented economy, which leads to disadvantages in US anti-dumping and countervailing investigations. Meanwhile, the US is also concerned about the trend of shifting production and investment from some countries to Vietnam to take advantage of labour cost benefits and a competitive environment.”

Hung therefore suggested relevant ministries, industries, and business associations to consider importing raw wood materials from the US to reduce the trade deficit and avoid origin-related lawsuits.

On the side of firms, caution needs to be exercised regarding raw material imports from countries that are subject to US tariffs.

At the same time, it is important to develop flexible production and business plans, as countries subject to US tariffs may strengthen trade protection measures, placing greater pressure on Vietnam.

In 2024, Vietnam’s wood and wood product export value surpassed $16.2 billion, up 20.9 per cent on-year, equivalent to $2.81 billion, further establishing Vietnam as one of the world’s leading exporters of wood and furniture products.