The number of raw materials has dropped sharply, and the price has soared. How do mahogany furniture companies respond?

Li Yimin

Recently, as the exporting countries of rosewood raw materials have been “closed”, the source of mahogany materials has been drastically reduced, resulting in a sharp increase in the price of raw materials in the domestic mahogany market, which has brought a big impact on the mahogany furniture industry. So, how should mahogany furniture companies respond? Recently, the reporter visited some of the city's mahogany furniture companies and conducted in-depth exchanges with entrepreneurs.

Exporting countries "closed", material prices rose

“In fact, some mahogany materials have already started to rise in price before the 17th meeting of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) in October this year.” Shuangyang Redwood Chairman Wang Haiyang said, “Laos, Cambodia After Myanmar and other countries have restricted exports (sealing) of some mahogany raw materials (semi-finished products), the price of these timbers will increase even more."

According to Lu Jialin, the chairman of Lu Jiayi Lin Hongmu, the price of Hedgehog rosewood (African Pear) rose from the original 4000 yuan / ton to the current 7,500 yuan / ton, Sian rosewood (red rosewood), Bali Dalbergia (flower branch), Myanmar The prices of materials such as rosewood (Dalian rosewood) also have different ranges (40% to 50%).

"The price increase of this mahogany material is different from that of 2013. It is not because of the high price caused by the inflow of hot money into artificial speculation, but because of the imbalance between supply and demand caused by changes in exporting country policies. There is no bubble in this price increase." Wang Haiyang said "Which degree will it rise, and who is not sure now, remains to be seen."

Li Zhongxin, chairman of CITIC Redwood, said that with the implementation of Appendix C of the CITES Endangered Species, the mahogany raw materials that can be developed and used in the future will become increasingly scarce, and the development of the mahogany furniture industry is grim.

Material costs increase, industry “shuffle” accelerates

The impact of rising rosewood prices on the mahogany furniture industry is obvious.

"From a certain point of view, the price increase of materials will promote sales to a certain extent, because many consumers are 'buy up and not buy down'. I heard that the price of mahogany materials has risen, they may quickly 'start'." The ocean said, "This is helpful for some companies to 'go inventory'. However, it is not good for the long-term development of the company because the production costs have increased greatly."

The industry generally believes that the soaring price of mahogany materials will accelerate the “shuffle” of the mahogany furniture industry. “Obviously, those companies that have no strength, no brand, no characteristics will be more difficult. They may choose to stop production or use new materials. Come to make furniture."

Some entrepreneurs worry that the price of rosewood materials will rise too fast, which will inevitably affect the price of finished furniture. If the price of furniture exceeds the price expectations of consumers, there may be a priceless market, which will make the market of mahogany furniture more depression.

The industry situation is grim, how should companies respond?

The industry believes that in the face of the growing shortage of mahogany materials, mahogany furniture companies will develop in two directions in the future. Some companies with strength, brand and characteristics will do better design and work more refined products. The cultural value of mahogany furniture meets the needs of high-end customers; some companies will look for alternative materials to transform the production of popular furniture to meet the needs of ordinary consumers.

Wang Haiyang said that the rise of mahogany materials will “force” the transformation and upgrading of the industry, do a good job in design, make fine products, and improve the cultural content and added value of mahogany furniture. "As far as I am concerned, I would like to choose this kind of production method of 'fine water and long flow', cherish resources and work hard to make the industry develop for a longer period of time."

Some entrepreneurs pointed out that some companies are currently looking for alternatives to mahogany materials. Many of these materials are not national standard mahogany. I hope relevant departments will strengthen supervision and prevent them from disrupting market order.