China Wood Products Prices

16-31th May 2005

Report from China   

Dollar Exchange Rates of 20th May 2005
China Yuan 8.28

Report from China 

Special Furniture Zones  

According to a recent survey by the Chinese Furniture Association, there are several special furniture clusters in the country as follows:  

China's redwood furniture, Dayong in Zhongshan  

The report indicates that there are some 500 enterprises producing redwood furniture in Dayong town in Zhongshan City, Guangdong Provinces and these enterprises employ around 30,000 workers.  

In 2002, production capacity in this area was said to be 800,000 units with a production value of Yuan 2.35 billion and exports were valued at US$43 million. Dayong redwood furniture has its own special style, is of good quality and is said to be competitively priced.  

China's chair industry  

There are some 415 enterprises producing chairs in An'ji County in Zhejiang Province. The main product is a five-wheel swivel chair and this product accounts for around 35% of the national chair production. In 2003, sales by An'ji manufacturers was Yuan 2.516 billion and exports accounted for 35% of total sales.  

Lecong County Furniture trade  

In Lecong County, Guangzhou Province, there are around 180 furniture department stores with a display area of 2.8 million square metres, more than 3800 business are represented as well as some 3350 traders.  

There are around 20,000 types of local and imported furniture on display and these stores have a supply catchment spanning 30 provinces and cities in China as well as sources in Hong kong, Macao, Taiwan P.o.C, the U.S.A, the Middle East, Europe and Southeast Asia. Annual furniture sales are reported at around Yuan 10 billion.  

Furniture in Daling, Dongguan  

In Daling, Dongguan, Guangdong province the value of output by the furniture industry is around Yuan 13.2 billion of which the value of exports was Yuan 12 million in 2003, making up almost 20% of the total national export value.  

The county boasts some 320 major furniture manufacturing enterprises including 3 companies listed on the Chinese stock exchange, 19 companies whose investment exceeded Yuan 100 million, as well as 28 whose investment exceeded Yuan 50 million. There are many well locally known enterprises such as Taisheng, Yunshitong, Zhende, Dayi, Dingsheng, Zhenxing and Fubao operating in Daling.  

High quality Furniture in demand  

Furniture sales in China's domestic market continue to grow rapidly and in 2004 total sales reached Yuan 273 billion, a year on year increase of 34%. Jia Qingwen, Secretary-general of China's Furniture Association, has forecast that demand for imported high quality furniture will grow further.  

Because of China's commitment to the WTO, the country has moved to a zero tariff on many types of imported furniture. This move has prompted the opening of new, up-market, imported furniture outlets such as "Beautiful Household Furniture Plaza", jointly managed by Henderson (China) Co. Ltd and Shenzhen Good 100 Year Furniture Chain store in Beijing.  

All furniture on display is said to be from world class producers from Germany, France and Italy, amongst others. 

The value of imported furniture through Guangdong port totaled US$11.587 million; a year on year increase of 22% from January to February 2005 and the main reason for the increased imports was the reduced tariffs.  

China's Customs has confirmed that furniture imports in the first two months of 2005 were up significantly exceeding levels seen through the port in 2004.  

Imported furniture was mainly from Japan and the US. The value of imports was US$4.41 million in January and US$2.275 million in February, making up, respectively, 38% and almost 20% of the national total furniture imports. 

Imports of furniture from Malaysia, Italy and France have doubled recently and local analysts think that medium and high quality furniture has become more popular amongst consumers as incomes have grown and more people are buying their own home.  

News in Brief 

China implemented a zero tariff on imported furniture as of January 1, 2005. However, analysts say it will take time for price cuts to filter to the Chinese consumer as goods imported under the old tariff regime are still being cleared from stock.  

Reports indicate that profits in China's furniture manufacturing industry rose by 43% last year. Profits are reported to have risen to Yuan 3.42 billion from January to November 2004 and this is higher than levels seen in 2002 and 2003.  

In the meantime, the value of furniture exports rose and the export value of plastic furniture grew the fastest. 

Analysts report that the trade is expecting demand in China for cabinet units for living rooms, bedrooms and kitchens to grow fast. According to forecasts, expenditure by households on cabinets will make up 24% of the total expenditure on household refurbishment and improvement in the urban expenditure on interior furniture.  

The demand for cabinet is said to have been near to 800 000 sets in 2003 but Chinese consumption of cabinet units by urban families was only 6.8% of all furniture purchases which is much lower than the average level of 35% for Europe and N. America.  

It is forecast that the growth of demand in China for cabinet units will grow rapidly and some say as many as 29 million units may be to satisfy demand within 5 years.  

Guangzhou City Imported Timber Market 

Shanghai Furen Wholesale Market 

Hebei Shijiangzhuang Wholesale Market  

Shandong De Zhou Timber market  

Tian Jin City Huan Bo Hai timber Market  

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