According to the Association of the German Furniture Industry (VDM), the effects of the coronavirus on the German-Chinese furniture trade are clearly noticeable, but not the only influences.
“German furniture exports to China showed significant signs of slowing down last year,” explains Managing Director Jan Kurth. “In 2019, exports to the Middle Kingdom declined by 16.5% to € 281 million. However, this decrease was less due to the coronavirus, but primarily due to the slowdown in economic growth in China and the introduction of higher furniture import duties in the United States. The oversupply of furniture from Chinese production had a negative impact on the demand for German and European furniture in China, but at the same time stimulated Chinese furniture exports to Europe. Accordingly, German furniture imports from China grew by 12.9% to € 2.15 billion last year. The German foreign trade deficit in furniture trade with China thus rose to € 1.87 billion. “
Even though there are currently no official foreign trade figures for the current year, the association is assuming the significant negative effects of the coronavirus on furniture demand in China and on the global supply chains that the German foreign trade in furniture with China will decrease significantly in the first quarter of 2020.
Not only the German furniture exports, but also the imports of furniture, intermediate products and supplier parts are likely to be affected. The VDM conducted a member survey at the end of February on the effects of the corona crisis on the German furniture industry. According to the first results, almost half of the companies surveyed (49%) are currently unable to deliver the goods already ordered to China. More than half of the respondents (58%) are currently seeing a decline in orders from China. On the import side, more than half of the companies (56%) state that they are affected by supply shortages from China.
“In addition to a – at least temporary – significant decline in German furniture exports to China, the current situation should also lead to a change in imports,” Kurth explains. “If, due to the hesitant start of furniture production in China, promotional goods for the German trade fail, or can at least be delivered with a delay, large areas and discounts in particular have to stock up on other things Distributed to other European or international countries of origin certainly also depends on the reaction speed and delivery reliability of the alternative suppliers. One thing is certain: 2020 will again be a particularly challenging one for the furniture industry. “