The domestic wood processing industry is facing shortages of both raw materials and skilled workers, warned the Viet Nam Forestry and Wood Products Association.
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| The wood processing industry is also suffering from a lack of skilled labour. |
The industry currently has a processing capacity of 3-3.5mil cu.m of timber per year, the association reported, but domestic raw materials can only supply 20% of this figure. The remainder comes from about 130 foreign lumber importers, resulting in high costs for the domestic production industry.
Costs of imported lumber have increased 20-22% over the past three years, as many countries have implemented policies to limit forest exploitation and timber exports.
Since last year, for instance, wood exporters like Indonesia and Malaysia have halted exporting lumber, sending Vietnamese processors scrambling for other raw material sources.
To meet the raw materials shortage, the industry is developing afforestation plans. Plantation forest growers are being asked to apply new strains and develop forest resources to meet at least 50% of raw materials requirements for the wood processing industry by 2010.
Skilled workers needed
The wood processing industry is also suffering from a lack of skilled labour.
Tran Quoc Manh, the head of a HCM City trade association, said the wood processing industry needed 120,000 skilled workers but was able to recruit only 20,000.
Wood processing enterprises were also facing shortages of trained engineers and technicians. At least 2,500 engineers were needed in the industry, according to Manh.
The HCM City Trade Department reported that five vocational training schools in Lang Son, Ha Nam, Qui Nhon, Tay Nguyen and Binh Duong were training students in simple wood processing skills, but small numbers of graduates from these schools were not enough to meet the industry's demands.
To address the skilled labour shortage in the wood processing sector, the Viet Nam Chamber of Commerce and Industry will work with businesses and trade associations to open vocational schools to train workers, technicians and engineers.
Many Vietnamese managers in the sector lack management, marketing and trade promotion skills needed to keep up with foreign competitors.
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Vietnam ranked fourth |
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Vietnam has ranked fourth among regional wood exporters after Malaysia, Indonesia and Thailand, surpassing the Philippines in timber export.
Viet Nam Forestry and Wood Products Association reported that the Country's market share of wood export stood at 0.78% or 0.24% higher than the Philippines. China is still the leading global wood supplier accounting for 11.9% of the world timber market.
In the first seven months, timber exports accounted for over $1.2bil, forecast to continue climbing in the future, mainly because as markets, including Japan, France, Germany, and the United States, have shown an increasing interest in Vietnamese wood products. |
Many wood processors do not have sufficient contacts in world markets and have to sell their products through overseas brokers and intermediaries, giving up a slice of the profits in the process.
Domestic enterprises are also losing a significant share of the domestic market to Chinese competitors who import into Vietnam.
Wood enterprises will be urged to set up websites promoting their products to international markets and pay greater attention to targeted potential markets such as Russia, Eastern Europe and Canada. Seventy per cent of exported wood products has gone to the US, Japan and EU.
Businesses will make greater attempts to populise their domestic trademarks and actively participate in global trade expositions.
Vietnam products have been sold in 120 countries, and the nation is one of the four largest wood exporters in Southeast Asia. In the first seven months of this year, the wood products industry fetched US$1.72bil from exports, this year targeting $2.8bil.
(Source: Viet Nam News) | 
