US Dollar Exchange Rates of
China Yuan 6.3888
Report from China
October GGSC-CN Index Report
In October 2021 China's PMI index registered 49.2%, a
decrease from the previous month, the second consecutive
month of decline indicating that the growth in
manufacturing slowed. In October domestic orders for
most timber manufacturing enterprises increased and
production increased but international orders have
Due to the rapid rise of domestic energy prices the price of
chemical raw materials has risen sharply and enterprise
costs have risen again. Most enterprises can only absorb
these increases for a short time. The GGSC-CN
comprehensive index for October registered 56.2% (44.2%
in October 2020 and 48.9% in October 2019). The October
level was above the critical value of 50% indicating that
the operation of the forest products enterprises represented
in GGSC-CN index expanded from last month. See below.
Challenges reported by enterprises
Transportation cost is too high.
The price of raw materials, especially chemicals,
changes too much.
The quality of some raw materials is unstable
affecting product production and sales and there
is no better supplier to choose.
There is a shortage of pine core board.
Raw materials in the whole import chain are in
Products in short supply
Merbau, Fibreboard, Melamine, Ebony, Pine core board.
Commodity for which the price has increased
Dipteryx, Tauari,Eucalyptus Planks,Fiberboard, Colored
paper, Melamine, Formaldehyde, Urea, Hexyl, Glue, Core
board, Paraffin, Waterproof agent
Commodity for which the price has decreased
China fir, miscellaneous firewood, eucalyptus fuelwood,
pine fuelwood, Oak
As for the GGSC-CN index in October 2021 two subindices
increased and three decreased.
The production index rose after 3 negative
The new order index increased but not for
The main raw material inventory index was
The employment index registered a rise from the
The supplier delivery time index dropped
reflecting that the time for raw material deliveries
was slower than last month.
RCEP coming into force
The Ministry of Commerce has issued a notice announcing
6 ASEAN member countries (Brunei, Cambodia, Laos,
Singapore, Thailand and Vietnam) 4 non-ASEAN member
countries (China, Japan, New Zealand and Australia) have
formally submitted their written authorisation for
ratification of the Regional Comprehensive Economic
Partnership (RCEP). RCEP will come into force for these
ten countries on 1 January 2022.
The Regional Comprehensive Economic Partnership
(RCEP) was initiated by ASEAN in 2012 and has taken
eight years to formulate. In November 2020, the Fourth
Regional Comprehensive Economic Partnership (RCEP)
Leaders' Meeting was held via video after which 10
ASEAN countries and 15 Asia-Pacific countries including
China, Japan, South Korea, Australia and New Zealand
formally signed the economic partnership agreement.
RCEP is a comprehensive, modern, high-quality and
mutually beneficial free trade agreement. It is also the
world's largest free trade agreement in terms of population,
economic scale and development potential.
RCEP countries have an economic output of US$25
trillion roughly 30% of global gross domestic product,
population and trade and more than the Comprehensive
and Progressive Agreement for Trans-Pacific Partnership.
The Ministry of Commerce says implementation of the
RCEP will encourage other member states to expand trade
and investment cooperation with China, share the Chinese
development dividends and achieve mutual benefit and
Zero tariff for China¡¯s multilayered wood flooring
The U.S. Department of Commerce recently announced its
final judgment on the eighth annual review of antidumping
and anti-subsidy investigation on multilayered
wood flooring from China. Jiangsu Senmao Bamboo &
Wood Industry Co., LTD, as a compulsory respondent
enterprise, secured a zero anti-dumping duty rate of
American wood flooring.
Jiangsu Senmao Bamboo and Wood Industry Co., Ltd.
was founded in 2006. The company is an export-oriented
enterprises trading solid wood composite flooring
products. The main export markets are the United States,
Canada, Australia, Mexico and the UK.
Investment in Mexico
Zhongyuan Home Furnishing Co., Ltd. recently issued a
notice on the establishment of overseas subsidiaries to
invest in production in Mexico.
According to the announcement, Zhongyuan Home
Furnishing Co., Ltd. intends to establish a subsidiary
Zhongyuan Mexico Co., Ltd. in Mexico through the joint
investment by its wholly-owned subsidiary Zhongyuan
International and Hong Kong Kaimao. The total
investment is around US$20 million.
It has been reported that the Mexican subsidiary will be
fully responsible for the project construction and operation
management of production base in Mexico. The
company's business plan includes production and sales of
hardware products, electronic products and home
Decline in prices for wood-based panels
The price of wood-based panels in Hebei, Shandong and
other places are falling. The latest news is that the price of
MDF has dropped by RMB 3-10 per sheet. For some other
panels the decline was as much as RMD8/sheet. However,
it appears the decline has not yet benefitted the consumer.
Relocation of Taicang wood processing
A 100 day initiative in Tancang City, Jiangsu Province
earlier this year resulted in many enterprises being
relocated or closed. Many timber processing and trading
enterprises that operated in Tancang City have transfered
to Xinminzhou in Jiangsu Province, Lanshan District of
Rizhao City in Shandong Province and Jiangdu District,
Yangzhou City, Jiangsu Province. However, there said to
be problems such as insufficient port capacity. Analysts
say it is urgent to upgrade the production to create a sound
Taicang City still mhas more than 300 enterprises engaged
in timber trade, processing and logistics services of which
there are about 120 timber trade enterprises and 130 log
Guangxi, the largest timber producer in China
Guangxi Zhuang Autonomous Region has been the largest
timber producer and surpassed the Northeast Region of
China in 2006. The total output of timber in China in 2019
was 100.46 million cubic metres of which Guangxi topped
the list with production of 35 million cubic metres.
Timber output in the Guangxi Zhuang Autonomous
Region fell 4% to 33.6 million cubic metres in 2020 but
the proportion of Guangxi timber output remained
unchanged and ranked number one in China. Demand for
wood products slowed in 2020 and domestic timber
production declined to 87.27 million cubic metres, down
13% year on year.
Eucalyptus dominates the forests of Guangxi. Data show
that 80% tree species of forest logging in Guangxi is
The latest statistics also show that Guangxi's forest area
was 14.87 million hectares, including 9.07 million
hectares of plantation. The planting area of eucalyptus is 2