Despite facing tremendous challenges in 2022, the wood processing units under the Vietnam Rubber Group (VRG)made remarkable efforts to maintain stability, meet most key targets, and ensure income security for their workers.
Market Difficulties and Global Instability
Table of Contents
The year 2022 witnessed major global economic disruptions caused by the Russia–Ukraine conflict, debt crises in several countries, and inflation surges across Europe. Prices of essential raw materials such as urea, methanol, melamine, citric acid, adhesives, and timber rose by 20–60% compared to 2021, directly impacting the production costs and profitability of VRG’s wood processing enterprises.
At VRG Quang Tri MDF, production surged during the first four months, reaching 39,450 m³ — twice the company’s capacity — but from May onward, demand dropped sharply. Orders slowed to just 60% of previous months and continued declining by another 20% toward the end of the year.
Similarly, Thuan An Wood Processing JSC, a leading refined wood manufacturer, faced order cancellations in the second half of the year as foreign buyers struggled with reduced consumption.
Overall, nearly all wood processing enterprises reported lower revenues and profits. Among the eight key companies — VRG MDF Quang Tri, VRG MDF Kien Giang, Dongwha MDF, Truong Phat, Thuan An, Tay Ninh, Dau Tieng, and Dong Nai — total post-tax profit reached VND 349 billion, with only VRG MDF Kien Giang exceeding its full-year targets at 111.55%.
Meeting Core Targets Despite Adversity
As a relatively new player in the MDF market, VRG MDF Kien Giang JSC achieved impressive results in 2022:
-
Production: 127,000 m³ (+28% vs plan)
-
Revenue: VND 762 billion (+30.43% vs plan)
-
Post-tax profit: VND 28 billion (+11.55% vs plan)
-
Average income: VND 8.9 million per worker/month (+19.56% vs plan).
VRG MDF Quang Tri JSC also maintained solid performance despite market headwinds:
-
Production: 240,000 m³ (100% of plan)
-
Revenue: VND 1,284.97 billion (100% of plan)
-
Profit after tax: VND 40 billion
-
Average income: VND 12 million per worker/month (+7.27% vs plan).
Across the eight units, total output reached 1.22 million m³ of wood products, achieving 98.25% of annual targets. Total revenue exceeded VND 6,861 billion (101% of plan), profit after tax reached VND 349 billion, and average worker income was VND 10.6 million/month.
Ensuring Worker Welfare and Stability
Despite financial strain, VRG’s wood subsidiaries continued to prioritize employee welfare.
-
VRG Dongwha MDF: VND 23.5 million/month (+4.63% vs plan)
-
VRG MDF Quang Tri: VND 12 million/month (+7.27%)
-
VRG MDF Kien Giang: VND 8.9 million/month (+19.56%)
-
Dau Tieng Wood: Income surpassed targets by nearly 7%.
At the VRG Wood Processing Sector Review Conference, Mr. Huynh Kim Nhut, Deputy General Director of VRG, noted:
“Despite severe challenges, our wood processing units have largely met their goals in production, revenue, and employee income. The sector alone contributed about 9% of VRG’s total post-tax profit.”
Outlook for 2023: Navigating Continued Volatility
Mr. Nhut cautioned that 2023 will remain challenging, given the ongoing war in Ukraine and persistent inflation in raw material costs. He emphasized that each unit must proactively assess risks and identify internal strengths and market opportunities to ensure business efficiency and resilience in the year ahead.