On August 12, 2025, the Vietnam Rubber Group (VRG) held its 2025 Wood Industry Conference under the theme “Restructuring and Development Orientation of the Group’s Wood Sector.”
The event was chaired by VRG General Director Le Thanh Hung and Deputy General Director Pham Hai Duong, with participation from senior leaders of VRG’s specialized departments and member companies involved in wood processing, manufacturing, and trading.
Comprehensive Evaluation and Strategic Reform
Table of Contents
The conference reviewed the performance of VRG’s wood sector during 2020–2024 and the first half of 2025, focusing on restructuring solutions, governance efficiency, product diversification, and international competitiveness.
In his opening remarks, Deputy General Director Pham Hai Duong emphasized that over the past two decades, the wood industry has been one of VRG’s five key pillars, contributing significantly to the Group’s overall growth. However, in recent years, several wood-processing subsidiaries have faced operational challenges due to internal inefficiencies and external market pressures.
He noted that the sector now faces major challenges such as volatile input materials, sluggish demand leading to high inventories, and stricter global standards on green production, sustainability, and digital transformation across the supply chain. VRG, he said, remains committed to investing in technology, raw-material zones, and capacity-building for smaller enterprises to ensure balanced and sustainable growth.
Reports and Key Assessments
The conference featured presentations from several divisions:
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Task Force 320: Restructuring and development orientation of the VRG wood sector.
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Finance & Accounting Division: Operational performance and financial status of member companies.
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Investment & Construction Division: Evaluation of restructuring progress.
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Legal & Compliance Division: Legal issues across wood subsidiaries.
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Industrial Division: Proposed plan for utilizing rubberwood from VRG’s projects in Laos and Cambodia.
Participants also discussed solutions for export market adaptation, ESG alignment, energy efficiency, production optimization, and labor welfare to strengthen overall competitiveness.
Rubberwood – A Key Contributor to Vietnam’s Export Growth
Vietnam’s wood industry ranks among the Top 5 global exporters, No. 2 in Asia, and No. 1 in Southeast Asia, with products reaching over 150 markets. In 2024, wood and wood product exports totaled USD 16.25 billion, up 20.3% year-on-year, while the first half of 2025 recorded USD 8.21 billion, up 8.9%.
Within that, rubberwood exports achieved USD 2.8 billion in 2024—up 28.6% year-on-year—accounting for 17.2% of Vietnam’s total wood-export value. Rubberwood therefore remains a crucial component in both VRG’s business structure and the country’s sustainable wood-product value chain.
Performance Overview of VRG’s Wood Subsidiaries
VRG currently operates 16 wood-processing companies with 18 factories, a total designed capacity exceeding 1.08 million m³/year. The product mix includes rubberwood blanks, laminated boards, finished furniture, and MDF panels.
From 2020–2024, production averaged 1.1 million m³/year, though the product structure shifted sharply toward MDF, now accounting for more than 90% of output. Revenue peaked at VND 7.7 trillion in 2022 but fell to VND 6.17 trillion in 2024, while pre-tax profit dropped from VND 836 billion in 2020 to VND 191 billion in 2024. Despite challenges, the first half of 2025 still generated VND 2.8 trillion in revenue and VND 136 billion in profit, signaling potential recovery if restructuring succeeds.
The MDF segment continues to drive profits, with plants such as Dongwha, Quang Tri, and Kien Giang operating above 160% of design capacity. In 2024, MDF production contributed 12.6% of VRG’s total pre-tax profit. However, the sector still faces high inventories, aging equipment, and volatile raw-material costs.
Strategic Solutions for the Future
Task Force 320 proposed a set of integrated measures:
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Financial restructuring and tighter capital management.
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Technology upgrades focusing on MDF and finished rubberwood products.
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Proactive raw-material strategy: expanding plantation forests, securing long-term supplier contracts, and maximizing use of internal rubberwood resources.
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Product and market diversification toward ESG-compliant products and emerging markets such as Canada, India, and the Middle East.
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Cost optimization and organizational streamlining, including consolidation or divestment of inefficient factories.
These reforms aim not only to improve profitability but also to advance sustainability, digitalization, and social responsibility in alignment with global green-production standards.
Leadership Commitment to Sustainable Growth
In his closing remarks, General Director Le Thanh Hung commended the dedication of VRG’s wood enterprises while acknowledging existing inefficiencies, particularly among primary-processing and laminated-wood companies. He urged all subsidiaries and capital representatives to decisively implement restructuring, diversify product portfolios, increase value-added rubberwood exports, and adopt digital technologies in management and production.
He also highlighted the importance of efficiently utilizing around 30 million m³ of rubberwood expected from VRG’s projects in Laos and Cambodia, ensuring compliance with local regulations and sustainability principles.
“The wood sector will remain a core and strategic pillar of VRG,”
said Mr. Le Thanh Hung.
“We will continue to expand market reach, modernize production, and strengthen the VRG brand both domestically and globally.”