The cost of imported wood has been rising steadily, and as a result, the price of rosewood furniture has remained weak. Market trends indicate that imported mahogany is becoming increasingly expensive, while the terminal market remains sluggish. Some mahogany furniture companies have reported that even high-end mahogany prices are "stiff," with some varieties experiencing slight declines. Overall, the mahogany furniture market is facing a situation of weak price increases.
Customs costs account for approximately 20% of the total cost of imported wood. According to media reports, Xiamen redwood merchants revealed that one of the most common smuggling methods used by domestic timber merchants is to misclassify high-grade timber as low-grade. If imported properly, this tariff cost can significantly impact the overall expenses.
Those who have followed the mahogany furniture market may recall a wave of rising prices in the previous year. The main reason for this surge was import restrictions. In June 2013, the import of various mahogany furniture began to be restricted, leading to a sharp increase in raw material prices. At that time, the sales price of mahogany furniture in some areas increased by about 10%. Most businesses chose to gradually raise prices rather than implement sudden increases, considering consumer acceptance.
The price surge is hard to come by. The rise in raw material prices affects the final products over time. With the recent production of finished goods made from “high-priced†wood, mahogany furniture is expected to see a price hike. However, the process from raw material to finished product takes time, and the market is still adjusting.
“In the second half of last year, we have been paying attention to the trend of mahogany furniture prices,†said Mr. Gu, a fan of mahogany furniture collection. He mentioned that within his “redwood fan circle,†discussions often revolve around potential price changes. When import restrictions were announced in June, many believed future prices would likely rise by about 30%, but the increase did not happen immediately. Instead, it was attributed to the time needed for raw material costs to influence final prices. From the trend observed since last year, the price increase has not been very obvious.
Mr. Gu believes that the possibility of a significant upswing in the future is not great, and the overall market should maintain a certain level of stability. Recently, the actions of well-known domestic mahogany brands seem to confirm this view. Starting from August 1st, almost all materials of “even the sky†will experience a price increase of 5%-10%. Experts suggest that such price rises will not be common. With fewer and fewer mahogany resources, hoarding materials has become a necessary strategy for maintaining production. Many businesses have already started stockpiling high-end mahogany.
Currently, the mahogany furniture market remains in a downturn, and the wood market is still declining. While high-end mahogany remains scarce, other types like East African black rosewood, African rosewood, and Burmese rosewood have seen declines ranging from 5% to 15%. Excessive focus on specific materials has introduced speculative elements into the market. Some speculators have driven up the prices of rare varieties too much, leading to concerns about the sustainability of these species. From another perspective, as raw material costs rise, smaller enterprises may gradually exit the market, encouraging more refined production practices among larger companies.
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