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There are reports that China’s furniture industry saw
lower profits in 2005 affected by higher production
costs. Analysts indicate that one reason is price
increases of timber raw materials due to declining
timber imports. Analysts estimate that timber
imports from Indonesia fell from 960,000 m3 in
2004 to 600,000 m3 in 2005, while those from PNG
declined from 1.3 million m3 in 2004 to under
1 million m3 in 2005. The average unit price for
timber climbed 15%-18% in 2005. Furthermore,
prices for other materials, such as dope and
adhesives, rose rapidly together with energy and
transportation costs.
According to a local furniture association, most
manufacturers, especially panel furniture firms,
have not raised furniture prices due to strong
domestic competition. Only few furniture firms
have adjusted the prices of their products. For
example, the average price of redwood furniture had
risen 30%. Analysts indicate that some of the firms
producing branded furniture would increase
furniture prices if raw material costs continue to
rise.
Source:ITTO Tropical Timber Market Report