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Wood Industries

The wood-based industry is one of the major revenue contributors to the country’s economy. In 2016, the revenue collected from the industry was RM22.11 billion. It accounted for 2.8% of total country’s export for the year. The industry created employment opportunities for 240,000 peoples.

The total investment for the 2016 was RM 678.2 million. Investment from domestic sources amounted to RM526.3 million (77.6%) while foreign investment was RM151.9 million (22.4%).

Main activities of the wood-based industry in Malaysia can be categorized into:

  • Logging of natural and planted forest ;
  • Primary processing activities such as sawn timber, veneer and panel products (plywood, particleboard and MDF).
  • Secondary processing activities such as mouldings, builders’ joinery & carpentry (finger joint, doors, windows and window frames, flooring and parquet) and furniture & furniture parts.

Currently, Malaysia is one of the world’s largest exporters of tropical timber and also a major producer and exporter for:

  • Sawn timber ;
  • Panel products (plywood, medium density fibreboard (MDF) and particleboard);
  • Builders’ joinery & carpentry (BJC) ;
  • Mouldings ; and
  • Furniture & furniture parts.

In 2016, there were more than 3,500 mills in Malaysia. In terms of numbers, Peninsular Malaysia accounted for 67.3% of the total mills and most of them are categorized under small and medium enterprises (SMEs). The large sawmills as well as veneer and plywood mills are located in Sabah and Sarawak using tropical wood species for their production.

The downstream processing mills for the production of fibreboard, BJC and furniture & furniture parts are mainly located in Peninsular Malaysia. These mills mainly utilise wood sourced from sustainable plantations.

Malaysian furniture manufacturers produce a wide range of furniture from office, kitchen, bedroom, dining room, occasional, living room, upholstered furniture/sofa, outdoor and garden furniture. They are using rubber wood (which accounted for 80%), tropical wood, rattan, metal, fabrics, plastic, glass, marble and composite materials. Companies producing furniture in Malaysia are export-oriented, where 90% of its production is exported to more than 160 countries. Export of wooden furniture in 2016 amounted to RM7.6 billion. The major export destinations were the USA, Europe, Japan and Australia. The emerging markets are UAE, Saudi Arabia, the Philippines and Russia while Algeria, Greece, Puerto Rico and Libya are the potential markets. Malaysia was the 8 th largest exporter of furniture in the world.

The furniture manufacturers are located mainly in Johor and Selangor. These two states accounted for 86.3% of the total exports of wooden furniture. To further enhance the furniture industry, the government has established a Muar Furniture Park, where it houses companies, innovation and training centers. The initiativewill contribute towards achieving the National Timber Industry Policy (NATIP) to achieve export of RM53 billion and RM16 billion for wood & wood products and furniture respectively by 2020.

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Last Updated : Monday 18th September 2017