Indonesia

Indonesian Plywood Exports Plunge to US, Surge to Mexico

The Indonesian Wood Panel Association reported that in the first quarter of 2026, Indonesia's plywood exports totalled 622,000 cubic metres, down 26% year-on-year, mainly due to a sharp contraction in the US market following the imposition of preliminary anti dumping and countervailing duties on Indonesian plywood by the United States.

From January to March, shipments to the US plummeted 60% to 94,000 cubic metres, while export value fell 58% to US$58 million, although the average price rose 6% to US$618 per cubic metre.

Japan regained its position as Indonesia's largest plywood market with a 28% share. South Korea ranked second with a 16% share. Malaysia accounted for 13% of Indonesia's plywood supply, with shipments stable at 80,000 cubic metres and export value edging up 3% to US$30 million. China's share narrowed to 4%, with shipments down 10% to 23,000 cubic metres and export value falling 19% to US$12 million.

Amid the overall contraction, Mexico emerged as a rare growth market, with shipments surging 65% to 15,000 cubic metres and export value leaping 82% to US$5 million. This growth marginally offset the loss of US buyers.

Indonesia Strengthens Timber Exports to U.S. with SVLK+ Certification

With growing global demand for responsible supply chains, Indonesia is committed to strengthening its position in the U.S. market by enhancing the legality, traceability and sustainability of its timber products.

At an international seminar titled "Indonesian Forest Products Access to the US Market: Trade, Legality and Sustainability" held in Washington D.C. on 14 May, Indonesian Forestry Minister explained that more than 70% of the plywood exported from Indonesia to the US has obtained Forest Stewardship Council (FSC) or the Indonesian Timber Legality and Sustainability Verification System (SVLK+) certification.

The Director of Sustainable Forest Management at the Indonesian Ministry of Forestry stated that the SVLK+ system is continuously being upgraded to align with global regulations, including the US Lacey Act and the EU Deforestation Regulation.

The Chairman of the Indonesian Forest Entrepreneurs Association (APHI) noted that the US remains a major strategic partner for Indonesia's timber industry. In 2025, Indonesia's exports of processed timber to the US are estimated at US$1.94 billion, accounting for 15% of Indonesia's total global exports.

Indonesia Exhibits Furniture Designs in Milan to Expand Exports to Europe

Indonesia's Ministry of Trade, through its Indonesian Trade Promotion Centre (ITPC) Milan, in collaboration with the Italian Chamber of Commerce for Southeast Asia, organised a post fair networking event in Milan, Italy, on 29 April. The event followed Indonesia's participation in Salone del Mobile 2026 and Salone Satellite 2026 in Milan.

The event aimed to sustain commercial momentum after the international design fair and convert buyer interest generated during the exhibition into long term export transactions. Director General of National Export Development at Indonesia's Ministry of Trade stated in Jakarta on 12 May 2026 that the post fair event represented an important opportunity for Indonesian furniture to expand into the European market. She added that Indonesian design is gaining increasing recognition on the global stage.

Indonesia Takes Steps to Expand Forestry Carbon Trading

Indonesian officials have said that following the promulgation of Ministerial Regulation No. P.6/2026, Indonesia, forestry companies, and carbon standards body Verra are accelerating the development of comprehensive carbon trading in the country's forestry sector.

The Indonesian Ambassador to the United States stated that the regulation provides a clearer framework for developing forestry carbon trading through a greenhouse gas offset mechanism. With this regulation, Indonesia now has a stronger foundation to accelerate forestry carbon trading.

Malaysia

Malaysia's Timber Industry Faces Triple Pressure

According to the Malaysian Timber Association (MTA), the country's timber industry is under triple pressure: the expanded scope of the Sales and Service Tax (SST), high diesel prices, and a severe shortage of foreign labour.

Since July 2025, the SST coverage has been widened, and the long standing tax exemption for sawn timber has been removed, with sawn timber now subject to a 5% sales tax. This is expected to push downstream production costs up by 8 12%.

In addition, although automation is being progressively implemented, the industry cannot quickly reduce its reliance on skilled and semi skilled foreign workers in the short term. The labour shortage in the timber and furniture sector remains acute, directly raising labour costs and constraining capacity utilisation.

Sarawak Timber Exports Decline Due to Weak Global Demand

Affected by weak global demand, Sarawak's timber industry exports fell by 10% in the first quarter of 2026.

Sarawak Deputy Premier and Second Minister of Natural Resources and Urban Development, Amar Awang Tengah Ali Hasan, said that export value dropped to RM564 million, compared with RM624 million in the same period last year.

Japan remained Sarawak's largest timber importer with RM298 million, followed by India (RM106 million), Middle Eastern countries (RM70 million) and the Philippines (RM23 million). In his ministerial winding up speech, he said that export products included plywood, logs, fibreboard, sawn timber, wood chips, wood pellets, etc.

Despite the overall decline in export value, wood pellet exports still grew by 3.3% in the first quarter of 2026 to RM21.4 million, compared with RM20.7 million in the same period of 2025.

He urged industry players to focus more on producing value added wood products such as engineered wood, furniture, biochar and biomass to enhance competitiveness and strengthen Sarawak's timber exports in international markets.

Sabah Drafts Forest Master Plan to Manage Resources

Sabah Chief Minister Hajiji Noor said at an International Forest Day celebration that the Sabah state government, through the State Forestry Department, is drafting a dedicated forest master plan to guide the management of the state's forest resources over the next 25 years.

Hajiji reiterated the Sabah government's commitment to maintaining at least 50% forest cover, in line with the 2018 Sabah Forest Policy. He noted that Sabah currently retains 63% forest cover, with 3.85 million hectares designated as forest reserves and other protected areas. To further strengthen forest management and conserve biodiversity, he said the state is committed to keeping 2.2 million hectares (30% of Sabah's total area) as totally protected areas.

He revealed that Sabah has identified about 400,000 hectares of degraded forest reserves for the development of plantation forests, as outlined in the 2022 2036 action plan. This aims to restore the productivity of degraded forests, reduce the timber industry's reliance on natural forest logs, and ensure a sustainable supply of raw materials.

Thailand

Middle East Conflicts Drive Up Building Material Prices in Thailand

Thailand's Ministry of Commerce said on 22 May that the ongoing US Iran conflict pushed the building material price index up 5.9% to 112.4 points in April, a 44 month high.

The Director of the Trade Policy and Strategy Office stated that the Middle East war has driven up oil and other energy prices, affecting the production and logistics chains of building materials and causing price increases across almost all categories.

Among them, wood product prices rose by 1.0% due to higher raw material and transport costs, affecting products such as formwork timber, framing timber, doors and windows.

Over 12,000 Community Forests Established in Thailand

In the area of sustainable forest management, the Thai government places importance on cooperative mechanisms with local communities. On 25 May 2026, at the Royal Thai Navy Maritime Power Centre in Chonburi Province, the Minister of Natural Resources and Environment presided over the launch of the 2026 National Community Forest Day.

At present, more than 12,000 community forests have been established nationwide, covering a total area of 7 million rai and benefiting over 5 million households.

Royal Forest Department Holds Meeting to Accelerate the Building of Community Forests 

The Royal Forest Department of Thailand held a meeting to determine operational guidelines and accelerate the implementation of relevant policies. The meeting discussed speeding up the establishment of community forests, with a target of 15,000 community forests nationwide, while revising the Community Forest Policy Committee's regulations on the use of community forest products and services, aiming to ensure that communities receive 100% of the benefits through carbon credit sharing.

In addition, regarding the issue of people living in forest areas, the meeting clearly resolved to expedite the resolution of residence and livelihood issues for residents in national forest reserves and to issue land use permits to residents by the end of fiscal year 2027.

Department of Business Development and BAAC Jointly Promote Trees as Collateral

Thailand's Department of Business Development, in cooperation with the Bank for Agriculture and Agricultural Cooperatives (BAAC), is actively promoting the use of trees as commercial collateral, aiming to provide farmers, community enterprises and micro entrepreneurs with more accessible financing channels while incorporating agricultural assets into a more stable financial system.

On 18 May 2026, after participating in a promotional event on using trees as collateral, the Deputy Director General of the Department of Business Development under the Ministry of Commerce said that promoting trees as collateral is a key policy to transform agricultural assets into tangible economic value.

The event included education on commercial mortgage laws and demonstrations of how to measure the initial value of trees for loan applications to financial institutions. Trees eligible as collateral include tamarind, wild olive, neem, teak, dipterocarp, Thai rosewood and Burmese rosewood.

Currently, more than 458,799 trees have been registered as commercial collateral in over 30 provinces, with total collateral value exceeding THB 197 million, covering five regions of the country.

China

China's Timber Imports Grow 4% Month on Month in April

Customs data show that in April 2026, China's timber imports reached 4.865 million cubic metres, down 6.8% year on year but up 4% month on month from March; the import value for the period was US$1.06 billion, up 1.1% year on year and 6.3% month on month.

Among these, log imports were about 2.98 million cubic metres, up 1.7% year on year and 7.9% month on month; the import value increased by 6.9% year on year and 8.6% month on month to about US$500 million. The average log import price in April rose 5.1% year on year.

Sawnwood imports reached 1.885 million cubic metres, down 17.8% year on year and 1.7% month on month; the import value fell 3.5% year on year to US$570 million, but rose 4.4% month on month; the average sawnwood import price in April rose 17.3% year on year.

China's Wood Product Exports Grow in April

From January to April 2026, China's plywood exports rose 17.40% year on year, fibreboard exports rose 9.80%, and particleboard exports surged by 111.10% year on year. Imports of various panels declined simultaneously, indicating that the international competitiveness of domestically produced panels continues to strengthen.

Home building materials also performed well. In the first four months of 2026, wooden furniture exports increased by 19.30% year on year, and exports of wooden doors and wooden/bamboo flooring rose steadily.

Export markets are also diversifying. While maintaining traditional markets in Europe and the United States, emerging markets in Southeast Asia, the Middle East and Latin America have continued to release demand, resulting in a more balanced market structure.

New Freight Routes between China and Africa Opened

Recently, several new direct shipping routes between China and Africa were Opened. In Qingdao, China, a route to the West African ports of Tema and Lagos was launched.

Since January, China’s Yantai has opened three new routes to destinations including Algeria and Namibia.

In particular, in Tianjin, a direct route to South Africa was opened on 20 April, with container ships capable of carrying up to 11,000 boxes, reducing transit time to 40 days, 10 days less than before.

Following the opening of these new routes, there are more freight routes between China and Africa, but most importantly they are direct, with no intermediate stops. As a result, logistics costs are reduced, supply chain security is improved, and two way trade is accelerated.