KUCHING: Vietnam’s wood product exporters are in fierce competition with major global players, including China, Malaysia and Indonesia. These countries boast advanced processing technologies, lower costs and well established supply chains, reported International Tropical Timber Organisation (ITTO) Tropical Timber Market Report (July 16-31, 2025). The report said requirements for transparent, certified sourcing and rising costs are impacting Vietnam’s export competitiveness. In addition to trade barriers, the domestic wood industry is contending with challenges in raw material supply. The European Union (EU) has implemented new technical and legal requirements.
Regulations such as the EU Deforestation Regulation (EUDR), Carbon Border Sustainability Mechanism (CBAM) and Corporate Sustainability Reporting Directive (CSRD) are demanding more rigorous environmental and traceability standards. In Japan, meanwhile, policy changes are affecting wood pellet exports by Vietnam. Vietnam has for years enjoyed a robust export business for its wood and wood products (W&WP).
In the first six months of 2025 (1H2025), the country recorded an eight per cent jump in the export value of W&WP to US$8.2 billion, of which WP contributed US$5.6 billion, up nine per cent from 1H2024. Although Vietnamese wood roducts have been sold to over 160 countries and territories, the United States (US) remains the largest market, accounting for 56 per cent of the industry’s export earnings, with Japan and China followed with market shares of 13 per cent and 10 per cent respectively. As a result, fluctuations in US regulations create a ripple effect across the entire industry.
According to Dinh Durong Furniture Association chairman Nguyen Liem, major shifts in trade policies among importing countries had been felt since early this year by Vietnamese wood exporters. Recently, the US Department of Commerce (DOC) initiated anti-dumping and countervailing investigations into plywood imported from Vietnam.
“The action has placed more than 130 Vietnamese timber processing and exporting companies under scrutiny, casting uncertainty over one of Vietnam’s most valuable export category.
“Despite this, the Ministry of Agriculture and Environment (MAE) has set an ambitious export goal for the wood sector in 2025 at US$18 billion. Global geopolitical tensions and trade policy shifts continue to threaten the feasibility of this target,” said the ITTO report. In response to the on-going US anti-dumping probe, the Vietnam Timber and Forest Product Association (Viforest) is preparing to participate in the US hearings on the allegations.
The association said this is to clarify that Vietnam’s plywood industry merely complements, rather than harms, the US domestic wood sector.
The MAE, on the other hand, is actively coordinating with US governmental bodies to resolve the issues through dialogue and technical clarification. To reduce over-reliance on traditional buyers, experts have urged Vietnamese wood businesses to expand into new markets, such as the Middle East, South Asia, Africa, Latin America and Eastern Europe because of their growth demand for furniture, construction timber and value-added products.
The report said the on-going negotiation for a free trade agreement between Vietnam and India are expected to reduce import tariffs from 10 per cent to five per cent, further boosting competitiveness of Vietnamese products.
The MAE has called for at least 80 per cent of wood processing and storage facilities nationwide to meet advanced technological benchmarks as this transition would allow Vietnamese firms to meet the increasing complex technical and environmental demand of foreign customers. At the same time, the global shift in supply chains, including companies looking to diversify away from Chinese sourcing, offers Vietnamese firms an opening.
By investing in compliance, certification and efficient logistics, they can become a trusted alternative in the global wood product market, said MAE. And according to Viforest, with proper orientation and coordinated efforts between the state and enterprises, the wood industry can not only overcome current challenges but also strengthen its global standing. Whether through entering emerging markets, upgrading processing technology or enhancing legal compliance, Vietnam’s wood industry is laying the groundwork for a more resilient and competitive future.
