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US
Dollar Exchange Rates of 13th Oct. 2006
China Yuan
7.902
Report from China
China¡¯s MDF industry undergoes rapid expansion
China¡¯s MDF has been developing rapidly since 2001. About 60-65 production lines and 3 million m3 of
production capacity have been added annually. The growth of China¡¯s MDF output has mainly depended on
the development of small mills. About 60% of the firms have a production capacity of less than 35,000 m3, 25% of
35,000-75,000 m3 and 15% of 75,000-80,000 m3. There were 492 MDF manufacturers and 609 production lines
with a total annual production capacity of 26.27 million m3 as of December 2005, an average of 43,100 m3 per
production line. Of the total, there were 58 production lines using imported equipment with an annual production
capacity of 5.2 million m3, accounting for 9.5% and 19.8% of China¡¯s production line and capacity, respectively.
Dalian builds largest timber processing base in Asia
On 31 May 2006, the Dalian Zebon Group began building a huge processing base of imported logs in Chengmai
County, Hainan, the largest timber processing base in Asia according to the Group. The base involved an investment
of 770 million yuan ($97.5 million) and was expected to
be completed by early 2007. The 3,000 mu (200 ha) base would process 1.2 million m3 of logs a year with an annual
output value of $720 million and net profits of 1.2 billion yuan, and would generate 2,000 jobs.
The timber raw material would be imported from Australia, processed and exported back to that country.
Australia Resource Co. Ltd. would annually supply 400,000-1,200,000 m3 of timber, which would be processed into 200,000 m3 of wooden floors to be
exported to the Australian company.
Guangdong¡¯s furniture exports soar to new high
Guangdong¡¯s furniture exports have risen 20% to $4.4 billion in the year to August 2006, according to Customs
statistics. The USA and Europe remained the province¡¯s main export markets, accounting for 60% of total exports.
Guangdong¡¯s furniture exports to these markets have grown 23% and 26% to $2.1 billion and $700 million,
respectively.
Guangdong is China¡¯s largest furniture production center and distributing base. Export prices for Guangdong
furniture have risen markedly in recent years together with product quality. Wooden furniture, wooden frame seats
and metal frame seats accounted for 70% of total furniture exports. China¡¯s exports of furniture such as upholstered
sofas, seats and chairs could be subject to an anti-dumping investigation by the European Commission (see TTM
11:17 and 11:5) and Guangdong furniture exporters were preparing their cases should the investigation be carried
out.
China and Chile reach agreement on tariff reduction
China and Chile have agreed to remove tariffs from October and to advance their free trade (FTA) agreement
talks. Under their cargo trade agreement, Chile agrees to remove the tariff rates of 5,891 products imported from
China while China will reduce the tariff rates of 2,806 products imported from Chile to zero this year and would
remove the tariffs of another 1,947 products next year. Most of the products are farm produce, petrochemical,
electronic and machinery products. In 10 years, 97% of the cargo items involved in the FTA would be gradually
exempt from import tariffs.
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