US Dollar Exchange Rates of
25th
Jul
2024
China Yuan 7.28
Report from China
Home prices and interest rates fall
China’s home prices fell again in June, underscoring the
challenge for policymakers to halt the property market
slump that’s hurting developers and the economy.
New-home prices in 70 cities, excluding state-subsidised
housing, dropped 0.67% from May, when they slid 0.71%,
the most since October 2014, according to National
Bureau of Statistics figures. Values of existing homes
declined 0.85%, compared with a 1% decrease a month
earlier.
China's central bank is cutting two benchmark interest
rates to support the economy amid the prolonged real-
estate slump and an increasingly uncertain outlook. The
People's Bank of China announced in July that it is
lowering the 1-year Loan Prime Rate (LPR) by 0.1 of a
percentage point to 3.35 percent. This wasis the rate's first
cut in 11 months.
The Bank says it is also making a 0.1-percentage-point
reduction in the five-year LPR, a benchmark for long-term
lending, including housing loans. The first cut in five
months for the five-year rate brings it down to 3.85%.
See: https://www.bloomberg.com/news/articles/2024-07-
15/china-home-prices-fall-sharply-despite-latest-rescue-plan
https://www3.nhk.or.jp/nhkworld/en/news/20240722_22/
and
https://www.stats.gov.cn/english/PressRelease/202407/t2024071
6_1955646.html
Revised "green"Sstandards on furniture
Two "green" standards on furniture, the "Green Product
Evaluation Standard for Furniture" and the "Green Design
and Evaluation Standards for Furniture”, have been
revised and released by the State Administration for
Market Regulation (State Standards Committee).
The Green Product Evaluation Standard for Furniture
stipulates the evaluation requirements of furniture
products, and the revision refines the relevant indicators
for "energy" and "low carbon", optimising the
requirements of resources, environment and quality
attributes.
The Green Design and Evaluation Standards for Furniture
clarify the terms and definitions of furniture green design,
and specify the evaluation objectives, principles and
requirements. The revision focuses on the greening of the
design stage and introduces requirements for full life cycle
evaluation, from selection of raw materials, production,
sales, and use, to recycling at end-of-life.
See: https://www.chinanews.com.cn/cj/2024/07-
23/10255516.shtml
China’s particleboard production continues to rise
Wood-based panel industry data from the Industrial
Development Planning Institute under the National
Forestry and Grassland Administration shows that in the
first half of 2024, China's particleboard industry grew
further in terms of the number of enterprises and total
production capacity.
In the first half of 2024, 24 particleboard production lines
(including 16 continuous flat pressing lines) were built and
put into operation nationwide, creating additional
production capacity of 7.6 million cu.m. per year.
China now has 311 particleboard production enterprises
and 332 particleboard production lines. A further 43
particleboard production lines are under construction in
the country.
In contrast, the plywood industry shows a decline in the
number of enterprises and total production capacity. In the
first half of 2024, there were a total of around 6,900
plywood manufacturers in China, distributed in 27
provinces and municipalities, about 500 fewer than the end
of 2023.
The fibreboard industry has also shown further contraction
in the number of enterprises, production lines and total
capacity, and its production and sales have gradually
become balanced.
In the first half of 2024, two fibreboard production lines
(including one continuous flat pressing line) will be built
and put into operation, adding 420,000 cu.m of capacity
per year. China now has 264 fibreboard production
enterprises and 292 fibreboard production lines.
See: https://www.wood365.cn/Industry/IndustryInfo_280929.html
`Wood Loan’ supports Guangxi forestry industry
With its forestry sector facing difficulties raising finance,
high borrowing costs and slow payments, the government
of Laibin city in Guangxi Zhuang Autonomous Region
worked with the local financial supervision bureau to
launch the ‘Laibin Wood Loan’ in 2021. Recently, Shilong
town in Xiangzhou County of the Guangxi Zhuang
Autonomous Region also implemented a wood loan
scheme, thereby greatly reducing companies’ financing
costs.
The 'Laibin Wood Loan’ has been taken up by more than
1,400 wood processing enterprises in the city, and also
extends to forest planting, furniture production, integration
of forest pulp and paper and other related industry
enterprises. It is the first financial product for both
upstream and downstream industry chains of the wood
processing industry in the region.
The number of enterprises in the wood processing industry
in Laibin city increased from 54 to 208 at the end of the
13th Five-Year Plan, with 40 more established each year.
Since the implementation of the `Laibin Wood Loan’, the
city has issued a total of RMB4.261 billion of loans,
benefiting 790 market entities, with a weighted average
interest rate of about 2.53% of loans, directly reducing
financing cost of borrowers by RMB101 million.
See: https://www.forestry.gov.cn/c/www/dfdt/577235.jhtml
GGSC June report
China’s Ministry of Ecology and Environment and 14
other government agencies jointly issued "Implementation
Plan for Establishing a Carbon Footprint Management
System", the first time that multiple agencies have jointly
issued a document on carbon footprint management
system.
Data released by the General Administration of Customs
showed that China's imports of logs and sawnwood stood
at 5.99 million cubic metres in May 2024, a year-on-year
decrease of 6.45%.
Log imports decreased 4%, and sawnwood imports
decreased by almost 10%. However, exports of furniture
and parts maintained strong growth with exports totalling
CNY212.55 billion between January to May, an increase
of 20.5% over the same period last year.
While the delivery of new houses in China shrank the
market for renovating existing housing was gradually
rising. Chinese home furnishing companies were seeking
to seize the market for renovating old houses and some
companies were also shifting their focus to overseas
markets such as Southeast Asia.
In June the GTI-China index registered 46.7%, an increase
of 4.5 percentage points from the previous month and was
below the critical value (50%) where it has been for 2
consecutive months indicating that the business prosperity
of the timber enterprises represented by the GTI-China
index shrank from the previous month, however, the pace
of contraction eased.
The slowdown in demand and the sharp rise in shipping
costs caused inventories of finished products to increase in
June. Both production and order indices saw a decrease
from the previous month.
As for the 11 sub-indices, two (inventory of finished
products and delivery time) were above the critical value
of 50%, one (export orders) was at the critical value and
the remaining 8 indices were all below the critical value.
Compared to the previous month the indices for
production, new orders, export orders, existing orders,
inventory of finished products, purchase quantity,
purchase price, import and delivery time increased while
the indices for inventory of main raw materials and
employees declined.
Main challenges reported by GTI-China enterprises
Cash flow pressures existed, market demand was
insufficient, the volume of orders decreased and there was
a shortage of management personnel. The recovery of
payments was slow and products were difficult to sell.
To address some of these concerns it was suggested that
financing channels be broaden, loan conditions be
reviewed and more information be provided on export
market opportunities.
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