In 2012, the furniture industry was still in its early stages but faced a major challenge. A recent announcement from the Chongqing Foreign Trade and Economic Cooperation Commission revealed that the EU had introduced new regulations known as the "Wood and Wood Products Regulations and New Environmental Design Directives." These rules require all manufacturers involved in the timber supply chain—especially those exporting to the EU—to obtain an FSC (Forest Stewardship Council) certification, effectively acting as a "forest ID card."
The reporter noted that globally, only around 10% of timber is FSC-certified, and in China, less than 1% of wood available on the market meets these standards. This scarcity has placed significant pressure on Chongqing-based furniture exporters, leading to rising production costs, reduced profit margins, and a weakened price advantage.
The new EU directive, which came into effect on March 3, mandates that all timber and wood products exported to the EU must provide detailed documentation proving the legality of their source. This includes information such as the origin of the wood, the country and forest it came from, the volume and weight of the logs, and the name and address of the supplier. The regulation applies primarily to wood and wood products produced within the EU and imported from outside the bloc.
This move has created a new "green barrier" for Chinese exporters. With limited access to certified materials, companies are facing higher procurement costs, along with increased expenses related to inspections, testing, and certification processes. As a result, product prices are expected to rise, squeezing profit margins and potentially pushing some businesses out of the EU market.
China's furniture exports to the EU and the U.S. account for over 53.9% of total furniture exports, making the EU the largest export destination for Chinese furniture. However, with the implementation of the new regulations, many domestic firms may find themselves struggling to meet the requirements, leading to possible long-term consequences for their presence in the European market.
Chongqing’s furniture industry, traditionally focused on the domestic market, has been gradually expanding its international reach in recent years. According to data from Chongqing Customs, there are currently around 10 furniture-related companies actively exporting. In 2012 alone, the city's furniture exports surged by 7.5 times compared to the previous year, reaching $2.18 billion. These exports were mainly directed to Europe, the United States, and Southeast Asia, highlighting the growing importance of overseas markets for local manufacturers.
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