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China Wood Products Prices

16-31th March 2006


US Dollar Exchange Rates of  23th March 2006
China Yuan
8.048
Report from China

Demand for Chinese combi plywood wanes
Although the availability of various plywood grades from China is sufficient and prices are very competitive, Euwid reports that importers in the Netherlands and UK have ceased sourcing poplar/bintangor combi plywood from China. The decision was due to recent allegations by Greenpeace and other environmental organizations of China using illegal logs for the production of tropical plywood.


CFA eyes further expansion of furniture industry
Jia Qingwen, Chairman of the Chinese Furniture Association (CFA), indicated that the country¨s furniture industry developed rapidly during Tenth FiveYear Plan period (2001-2005). The total output value of the furniture industry rose 27% to 340 billion yuan ($45 billion) in 2005, up almost threefold from 2000. The annual average growth rate exceeded 20% over the last five years. The export value of all type of furniture grew 33% to $13.5 billion in 2005, three times as much as in 2000. Most of the export growth took place in Eastern China which accounted for 44% of the national total. Furniture exports had also increased rapidly in the Bohai Sea region (east Beijing), the Northeast and Sichuan Province (west China).


Meanwhile, imports of furniture fell in 2005 in spite of import duty tariffs close to zero. The value of furniture imports declined 13.4% to $549 million in January-October 2005. Mr. Qingwen highlighted the following achievements in the last Five Year Plan:
,The industry scale is large and continues to expand.
,The quality of furniture has improved significantly, involving the manufacture of middle and high grade furniture. There are five dominant and well-positioned brands in China.
,Furniture designing has improved.
,Eight feature regions and mature furniture industry zones are well established.
,The level of management has improved markedly, with family-run business being now transformed into modern enterprises.
,The impact of furniture expositions in Shanghai and Guangzhou have expanded to a world level. China is becoming an international procurement centre of furniture.
,The modernization of transportation and distribution industry has facilitated the flow of products.


Mr. Qingwen also identified some challenges:
, The fast expansion of production capacity has affected quality in middle and lower grade furniture while competition has become strong.
, There are still gaps in productivity of labour, management, design and technical level compared with developed countries.
, The regional development of the furniture industry is uneven.
, Imitation and copying are still prevailing in furniture manufacturing.

Mr. Qingwen expressed confidence that China¨s furniture industry was heading towards a golden age in the next 5 to 10 years, with both output and exports of furniture doubling in the next five years at a projected annual average growth rate of 15%.


Large industry parks to boost furniture making
Zhang Zhongling, Deputy Secretary-General of China Construction & Decoration Association, announced that three large industry parks of raw-materials for furniture manufacturing would be built in Beijing, Shanghai and Guangzhou. These are the Guangzhou World Furniture Exposition Centre, the Beijing International Furniture Industry Park and the Shanghai GSL International Furniture Business Port with a combined size of more than 2 million m2. The parks will operate as one-stop international platforms for trade, exposition and distribution.

Birch- and poplar-poplar ply have low yield rate due to small diameter and bad quality,and are therefore more expensive than okoume-poplar ply. 

Abbreviations

LM        Loyale Merchant, a grade of log parcel  Cu.m         Cubic Metre
QS         Qualite Superieure    Koku         0.278 Cu.m or 120BF
CI          Choix Industriel                                                       FFR            French Franc
CE         Choix Economique                                                        SQ              Sawmill Quality
CS         Choix Supplimentaire      SSQ            Select Sawmill Quality
FOB      Free-on-Board     FAS            Sawnwood Grade First and
KD        Kiln Dry                               Second 
AD        Air Dry        WBP           Water and Boil Proof
Boule    A Log Sawn Through and Through MR              Moisture Resistant
              the boards from one log are bundled                      pc         per piece      
              together                      ea                each      
BB/CC  Grade B faced and Grade C backed MBF           1000 Board Feet          
              Plywood   MDF           Medium Density Fibreboard
BF         Board Foot F.CFA         CFA Franc        
Sq.Ft     Square Foot               Price has moved up or down

Source: ITTO'  Tropical Timber Market Report

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