From December 19th to 24th, 2012, a delegation of 22 members from the Qingdao Woodworking Machinery Association traveled to Thailand to explore the local furniture industry and woodworking machinery market. The group was officially invited to visit SKL Thailand and had productive meetings with key industry leaders, including ARAK SUKSAWAD, president of the Thai Furniture Industry Association (TFA). Zhang Youcheng, General Manager of Thailand Dazhou Industrial Co., Ltd., accompanied the delegation throughout the trip.
The visit provided an in-depth look at the current state of the Thai furniture sector. As one of the leading furniture producers in Southeast Asia, Thailand has long relied on its strong manufacturing base and skilled craftsmanship. However, recent economic challenges have put pressure on the industry. With Japan and the U.S., two of Thailand’s main export markets, facing economic downturns, the industry has seen declining demand. In particular, exports to Japan dropped by 15.6% last year, while U.S. exports fell by 5.67%. This decline affected nearly all of Thailand’s top 10 export markets, with only a few countries like the UK, Canada, and the UAE showing modest growth.
Thailand's competitive edge in low labor costs is now being challenged by neighboring countries such as Malaysia, Indonesia, and China, where even cheaper labor is available. Many Thai manufacturers are losing business to these regions, especially in sectors that rely heavily on manual labor. While only 11% of Thai furniture factories are classified as large exporters, local authorities have not made significant efforts to promote technological advancement or innovation. Instead, they are focusing on highlighting traditional strengths such as handcrafted designs, natural materials, and unique cultural influences.
Thailand also has a long-standing reputation for high-quality furniture, particularly in teak wood. However, due to environmental regulations introduced in 1989, which banned commercial deforestation of teak, the supply of this premium material has become limited. As a result, many manufacturers now source teak from neighboring countries. To compensate, the industry has turned to alternative materials like rubber wood, which comes from aging rubber trees no longer used for latex production.
During the visit, the delegation also toured SKL Thailand, a company specializing in rubber wood furniture, panels, and finger joints. The company shared insights into how it adapts to shifting market demands, particularly in response to new regulations such as the CARB formaldehyde emission standards in California. These regulations have forced manufacturers to reconsider their material choices and production methods. Using locally available resources like rubber wood can help reduce costs and improve sustainability.
On December 23rd, the delegation met with ARAK SUKSAWAD, who provided valuable perspectives on the challenges and opportunities facing the Thai furniture industry. The meeting included discussions on strengthening cooperation between the Qingdao Woodworking Machinery Association and TFA. Chairman Zhao Lide of the Qingdao association shared updates on the development of the local woodworking machinery sector, while both sides explored potential areas for collaboration.
Both parties expressed interest in future exchanges, with ARAK SUKSAWAD agreeing to visit Qingdao in the near future. The meeting concluded with the exchange of annual reports and a group photo, marking a positive step toward deeper international collaboration in the furniture and woodworking machinery industries.
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