KUCHING: The Vietnamese authorities are investigating alleged dumping of medium density fibreboard (MDF) by Malaysia and Thailand.
The probe carried out by the Trade Remedies Authority (TRA) under the Ministry of Industry and Trade was initiated in October
last year.
The TRA sent questionnaires to local companies and the deadline for them to reply was middle of last month, following which an assessment is carried out by the ministry.
“The investigation was the result of complaints from four Vietnamese MDF manufacturers on behalf of the domestic industry. The technical dossier claimed dumping and damage to local companies,” said International Tropical Timber Organisation (Itto) in its latest tropical timber report (July 16-31 2019).
The Vietnamese firms have claimed that the price of imported MDF from Malaysia and Thailand were below production cost by between 18 and 50 percent, which was damaging the domestic
MDF industry.
This is the first time the Vietnam timber industry has raised a trade conflict to protect the local industry.
In first half 2019 (1H-2019), Vietnam imported US$1.233 billion worth of wood products, an increase of 15 percent as compared to 1H-2018.
During the same period, Vietnam exported wood products valued at US$4.82 billion, up 16.6 percent over 1H-2018.
The top export markets are US, Japan, China, South Korea and the European Union (EU). The US is Vietnam’s key export market, absorbing US$2.25 billion or 47 percent of the country’s
total exports.
Exports to China and South Korea fell by 30 percent and 13 percent respectively during the period under review.
Analysts in Vietnam’s Ministry of Industry and Trade have anticipated total 2019 wood products exports of US$4 billion to the US, which is the biggest supplier of timber raw material utilised by Vietnamese manufacturers.
According to the ITTO report, Vietnam’s imports of wood products from the US were worth US$160 million in 1H-2019, an increase of about 25 percent year-on-year.
It is forecast that the US will become the major supplier of timber raw material for industries in Vietnam because large volumes are available, quality is good and the origin is traceable.
“On the downside, there are growing concerns on the risk of US anti-dumping investigations of Vietnamese exports and also the risk that not all timber raw materials entering the export supply chain can be verified, especially from wood processing industries that have recently relocated to Vietnam,” added the report.
On the implementation of Vietnam EU VPA/FLEGT (voluntary partnership agreement/forest law enforcement, governance and trade) which came into force on June 1, 2019, the Vietnam Administration of Forestry expects the VPA to lead to greater potential for wood products exports from Vietnam to the EU market.
“The adoption of the VPA is also expected to contribute to the sustainable development of Vietnam’s forest and a strong commitment to eliminate illegal timber from the supply chain.
