Japan
Wood Products Prices
Dollar Exchange Rates of 10th
Aug
2022
Japan Yen 135.4
Reports From Japan
Economy revived in second
quarter
Japan's economy made a come-back in the second quarter
2022 after the contraction in the previous quarter. This
was due to an upswing in consumer spending, especially
in the services sector, which no longer has to apply strict
protection rules. There is concern, however, that consumer
spending in the current quarter may slip.
The government is encouraging prefectural authorities to
implement measures to contain the latest corona variant
that has sent infections to record levels. There are no plans
for nationwide control measures. The seventh wave of the
BA.5 variant has pushed new cases in Japan to over
200,000 per day putting pressure on medical services and
disrupting commercial operations.
See:
https://www.reuters.com/world/asia-pacific/japan-free-uplocal-officials-battle-new-covid-variant-kyodo-2022-07-29/
and
https://www.reuters.com/markets/asia/japans-economy-likelyrebounded-q2-with-unleashing-consumers-2022-08-05/
Another record minimum-wage hike
A government panel has proposed raising the average
minimum wage for fiscal 2022 by a record ¥30 per hour or
more as the experiences accelerating inflation. In
discussions there was little agreement between the panel
and employers on by how much the increase should be.
The unions have been calling for a substantial rise as the
cost of living is rising while the private sector, which is
facing surging costs, has stressed the need for careful
consideration.
In related news, a Kyodo News survey showed that 42%
of major companies in Japan expect the economy to slow
over the next 12 months as they struggle with surging
commodity costs and the yen's weakness.
See:
https://japantoday.com/category/business/japan-gov't-panelto-propose-another-record-minimum-wage-hike
A rise in US rates could drive yen lower
The yen surged to a two-month high against the US dollar
recently as investors reassessed US inflation risk,
recession fears and intensifying market volatility.
In mid-July, the yen dropped to ¥139 against the dollar as
hedge funds and other investors guessed that US rates
would continue to rise while the Bank of Japan remained
locked into its ultra-loose policy. The risk for the Yen is
that interest rates in the US could increase again in
September.
Japan ¨C No. 1 covid hotspot
Japan has become the world¡¯s No.1 COVID-19 hot spot
according to international statistics. Most infected people
now only develop mild symptoms but still the health care
system is overwhelmed. As yet the government has not
imposed any restrictions on businesses or peoples¡¯
movements but the impact on consumption will be felt in
the coming months.
Furniture imports
Imports of wooden bedroom furniture just keep rising in
contrast to the value of imports of wooden office and
wooden kitchen furniture which have remained at around
the same level as in the first quarter of the past four years.
May office furniture imports (HS 940330)
May imports of wooden office furniture (HS940330)
declined over 50% year on year and were down over 20%
compared the value of April imports.
As in previous months the top shipper of wooden
office
furniture in May 2022 was China accounting for 67% of
total wooden furniture imports.
Two relative newcomers to the wooden office furniture
trade with Japan in May were the UK and Italy, each of
which accounted for between 5-6% of all May shipments.
Poland is a regular shipper of wooden office furniture to
Japan but in May the value of shipments dropped sharply.
May kitchen furniture imports (HS 940340)
Year on year May 2022 shipments of wooden kitchen
furniture (HS940340) rose over 30% but compared to
April there was little growth. The two major shippers of
wooden kitchen furniture to Japan are the Philippines and
Vietnam and manufacturers in these two countries account
for over 80% of all imports of this category of product.
With a further 7-10% of shipments comimg from China
there is little room for other manufacturers.
Shippers in Malaysia and Thailand have a small market
share but this has not improved in the face of tough
competition from the two main shippers.
May bedroom furniture imports (HS 940350)
And the upward trend in the value of imports of wooden
bedroom furniture (HS940350) continues. May saw
another rise in the year on year value of imports and
compared to April there was a 6% increase in the value of
imports.
Imports from shippers in China, the main supplier, rose
but arrivals in May from Vietnam dropped close to 10%.
China remains the main supplier of wooden bedroom
furniture to Japan with a share of imports at just over 60%.
Vietnam shippers had a 28% of imports in May. The other
shippers of note in May were Malaysia, Thailand and
Poland. For the first time this year May shipments from
Romania were sharply higher.
Trade news from the Japan Lumber Reports (JLR)
The Japan Lumber Reports (JLR), a subscription trade
journal published every two weeks in English, is
generously allowing the ITTO Tropical Timber Market
Report to reproduce news on the Japanese market
precisely as it appears in the JLR.
For the JLR report please see:
https://jfpj.jp/japan_lumber_reports/
Reports from the JLR will resume at the end of August.
The Obon festival (also known as Bon festival) falls in
August and most businesses close. This is an annual
Japanese holiday which commemorates and remembers
deceased ancestors. It¡¯s a tradion for workers to return to
their home townd as to celebrate the festival with relatives.
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