
Collabor
ation for Agriculture and Rural Development
(CARD)
Program
250
DEVELOPMENT OF RURAL FOREST INDUSTRIES IN VIETNAM
Project
title:
Improvement of operator skills and technology in small rural sawmill
s in
Vietnam
Project c
ode
:
CARD 027/06 VIE
Author
s:
Prof.
Peter V
inden
1
, Philip Blackwell
1
and Dr. Pham
Duc Chien
2
Project Implementing organi
s
ations:
1
The University of Melbourne, Australian Centre for Advanced Wood Processing
2
Forest Science Institu
te of Vietnam
SUMMARY
This report summaries major achievements of the CARD project entitled “Improvement of operator
skills and technology in small rural sawmills in Vietnam”. An extensive survey of the needs of the
rural sawmilling industry has identified
the current and future prospects for forest industries in
Vietnam. It highlights the very significant importance of this industry to the economy of Vietnam and
future well being of rural populations.
The CARD project has trained a core team of Vietnames
e scientists in the technologies (current and
future) that will assist the industry to develop. Visits to rural sawmills during the conduct of the survey
has provided an audit of their operations (as might be undertaken during a sawmill improvement
program
). The opportunity for providing advice on improving the operational efficiency of the
sawmill, drying or treatment facility was taken together with on
-
site training of Vietnam researchers
in the application of sawmill improvement programs.
Vietnamese res
earch staff attended an intensive training program at the School of Forest and
Ecosystem Science, Creswick campus, University of Melbourne, Australia and learned about the
hands on operation of sawmills, the alleviation of growth stresses; the efficient op
eration of kilns and
treatment plant, quality control monitoring of finished products, value added manufacturing and new
low tech technologies to assist expansion of sawmilling operations into value adding. The same
Vietnamese staffs participated in the de
velopment of training courses and have actively participated in
the training of rural communities in Vietnam in these aspects of wood technology.
Detailed analysis of specific sectors (sawmilling, drying and preservation) has highlighted the
technical need
s of these sectors, the technology options available and the cost / benefits of adopting
particular technologies. Very specific recommendations have been provided in each of these sectors as
to the best technical and economic (low risk) options available f
or expanding into value adding.
The haphazard and exponential proliferation of small sawmills has identified the potential for this
industry to be self starting and sustainable with appropriate technologies and local investment.
However, the survey also i
dentifies the fragility of self help initiatives that are dependent on
continuing raw material supplies (albeit of low quality) and the scant availability of knowledge and
technical skills needed to value
-
add sawn timber output. Clear policy decisions and
action is needed
to ensure continuing raw material supply of improved quality, together with appropriate training and
the availability of appropriate technologies for value adding that can be taken up through the same
process of self
-
help. At the same time
training needs to be provided that will upgrade skills and
awareness of OH&S issues.
Training materials and infrastructure have been developed and tailored to the requirements identified
in the survey. Implementation of policy recommendations from the re
ports will have a major impact on
the long
-
term development of the industry and future development of rural communities.

CARD 027/06
–
Improvement of rural sawmills
251
The most significant outcome of the project is that rural communities have articulated their perception
of the future needs of their se
ctor, their aspirations and fears for the future as well as their vision of
what potentially could develop in terms of expanding their activity. To a greater extent the sawmilling
community has articulated optimism in the light of opportunities that are av
ailable in developing
products and markets.
The project has provided the Vietnam Forest Service with a blue print or plan that is relatively low
risk in its implementation, but which recognises what has been achieved by the rural community in
low tech proc
essing of plantation logs and builds on this through a “New Forests” strategy and
Government investment in an innovative program of research, training education and out
-
reach.
1.
Introduction
An overview of Vietnam’s forest industries
and domestic market
(Chien et al 2010).
Identifies the following salient points:
Sawn timber production in Vietnam
exceeds 2 million m3 /annum.
Wood exports rank fifth in importance
behind crude oil, textiles, footwear and
seafood
Exports increased on average by 43%
annually
between 2000 and 2008.
Vietnam has become the 4th largest global
manufacturer and exporter of furniture that
together with handicrafts are exported to
over 100 countries.
Domestic production of timber is
supplemented by significant imports of
unprocessed
logs. Fifty
-
three percent of
logs processed in Vietnam are imported.
The value of timber imports exceeds US$1
billion.
Vietnam uses 11 million m3 of wood / year
of which 57% is used for sawn timber for
producing outdoor and indoor furniture and
constructio
n timber. The percentage end
-
use of acacia produced by rural sawmills
(derived from questionnaires directed at
small rural sawmills, (Blackwell et al,
2009) highlights also the importance of the
domestic markets for furniture production.
Domestic productio
n of raw logs from
plantations is expected to grow
substantially following the Vietnamese
Governments objectives (1998) of
establishing a 5 million hectare
reforestation program. Various estimates
(e.g. MARD, 2010) estimate that by 2020,
Vietnam could be c
apable of supplying 20
million m3 annually. Currently domestic
wood production from plantations is
expanding at about 10% / annum. This has
offset a reduction in the availability of
wood from natural forests.
Seventy
-
five percent of the current harvest
fro
m plantations comprises acacia spp. This
percentage is expected to increase.
The plantation rotation age for acacia is
approximately 7
-
8 years. Logs have a small
average diameter of approximately 250
mm.
Very little information is available on the rural
sa
wmilling industry in Vietnam or its
prospects. The objectives of this project were
therefore to:
Identify and define industry problems,
needs and opportunities through a
comprehensive survey and review of the
rural sawmilling industry.
Establish processes
and infrastructure for
training and technology development
Develop and conduct training programs to
improve operator sawmilling and business
skills for trainers and for mill operators.
Investigate demonstrate and recommend
more appropriate or alternative
t
echnologies to improve industry
performance.
Develop long
-
term strategies for industry
development
2.
Materials and methods
An inception meeting of stakeholders from
industry, education and research institutes,
government, bilateral and multilateral aid
a
gencies was held to identify industry
problems, needs and opportunities. Detailed
questionnaires were developed with input from
the inception committee. Vietnamese project
participants attended a training program in
Australia to develop and refine survey
m
ethodology and review appropriate wood
processing technologies. The industry survey

Peter Vinden, Philip Blackwell
&
Pham Duc Chien
252
and review was undertaken by a joint
Vietnamese / Australian team in representative
provinces, in cooperation with provincial
Departments of Agriculture and Rural
Developme
nt.
The survey was conducted in the form of a
participatory rural appraisal (PRA). Individual
mills were visited and the following types of
information sought from owners: log volume
input, sawn wood output and grades, price and
cost data, end
-
use markets
, equipment used,
employee statistics, problems identified by
owners, and owner’s views on development
needs of industry. A complementary survey
was also undertaken to include plantation
growers to assess their views on markets and
prices and sawn timber b
uyers to assess their
views on sawn wood products purchased. The
findings were supplemented by a separate
report outlining the current state of
development of forestry and the forest
industries in Vietnam, their contribution to the
economy and rural develo
pment and potential
to grow in the future. These reports were used
as background to developing more detailed
reports on individual sectors of the industry
including sawmilling, wood drying,
preservation, forest industries education and
training, research a
nd extension.
Structured programs of sawmill training for
rural communities were developed based on
the needs analysis identified in the survey of
rural sawmills. The focus for this training was
technical rather than training in business skills,
since it
was anticipated that this was the area
of greatest need. Course materials in the form
of Technical Notes and overheads were
developed for these courses. A “train the
trainer” course was held in Australia for
Vietnamese participants and again in Vietnam.
Fo
ur sessions of rural training were completed
successfully by the CARD project and feed
-
back obtained from course participants.
3.
Research results and discussions
Survey results from the small rural sawmilling
industry highlighted a chronic problem for
mo
st rural sawmills in ensuring an adequate
and consistent supply of logs for their
businesses. To a greater extent the use of
small
-
scale low capacity horizontal bandsaws
can be viewed as “opportunistic processing of
raw materials as and when the opportunit
y
arises”. The current focus of raw material
(acacia) producers is to produce wood chips
for export. Wood chips represent a low value
product and there is enormous opportunity loss
in satisfying local demand for furniture and
potential markets in building
and construction
that have not been realised. The absence of any
planned long term supply of logs to rural
sawmills servicing the domestic market means
that there is insufficient security for any
entrepreneurial activity to either invest in kiln
drying equ
ipment or sawmilling equipment.
The problem is difficult in Vietnam because of
a shortage of suitable forestry land, the small
size of farms where farm forestry might be
practiced.
Analysis of the forests industry sector
highlights a number of important a
ttributes
impacting on future directions for the industry.
Firstly the forest products industry is an
important export
-
earning sector that should
continue to expand in the future. Protocols
need to be in place to ensure that pests and
diseases are containe
d and are not imported
with unprocessed logs. Control methods need
to be in place pending outbreaks of timber and
forest diseases. Export of furniture and crafts
requires similar safeguards i.e. inspection to
ensure that exports are free of any pests that
may lead to barriers being imposed because of
potential infection risks in the importing
country. There is increasing international
awareness of the importance of containing and
minimizing risks of disease transfer between
and within national boundaries. D
omestic
production of timber destined for high value
uses such as furniture manufacture or export
needs to be free from sap
-
stain that may arise
during log handling and transport. There is an
unrealized market potential for domestic
timber production to be
used in construction.
Realisation of this potential demand needs to
be preceded with the implementation of some
preservative protection against termites and
decay that will be required for sapwood
protection.

CARD 027/06
–
Improvement of rural sawmills
253
Results of an intensive survey undertaken of
t
he rural saw
-
milling industry engaged in the
processing of acacia and eucalyptus species
Vietnam identified that approximately 90 % of
the rural sawmills operating in Vietnam are
family businesses. Ten percent are private
companies. The growth in rural saw
mills has
been relatively recent. Of all the sawmills
interviewed none had been in operation longer
than 18 years. The average time that sawmills
had been in operation was 5.3 years thus
indicating that the expansion of the rural saw
-
milling industry has b
een very recent. This
probably reflects the maturing of acacia
plantations that forms the raw material base for
this industry and the freeing up of the economy
to promote entrepreneurial activity. The survey
identified that a large number of the rural mill
s
only operated part time.
Table 1.
Percentage number of sawmills
operating full time
Region
Full time operation
North
25
Central
52
South
47
However, of those mills that indicated that
they were operating full time a large number
identified reas
ons as to why there were
substantial periods of down time. Key issues
comprised:
Lack of a c
ontinuity in the supply of logs;
Inconsistent markets.
Other reasons identified included:
That they only supplied local needs that were
seasonal or
That they s
upplied specialised end uses such as
coffins, joinery etc.
Bad weather and
Inconsistent power supply.
Despite a potential over capacity for sawing
the available raw material and inadequate
markets, 44% of sawmills indicated either
plans to expand or a wi
sh to expand their
activities. Target expansion areas were
primarily furniture manufacturing (78% of
respondents) of whom 21% indicated that they
would like to focus on high value export
markets. Other markets included handicrafts,
and kiln drying of timbe
r. Reasons forwarded
for identifying these potential opportunities
related to a perception that there were
substantial market opportunities in these
particular sectors. The main obstacles
hindering expansion related primarily to a lack
of funding followed
by the lack of available
skills. Other issues included the availability of
quality raw material, lack of good managerial
skills, a lack of knowledge and unstable
market conditions. In most instances, there was
a perception that there was an expanding
marke
t for furniture and that expansion into
such areas would stabilise demand for sawn
timber.
Fig 1
.
Typical verticcal sawmill with carnage that
moves the logs past the saw
Fig 2
.
Typical horizontal sawmill with operators
pushing the saw over the log
Saw
-
milling equipment (horizontal and
vertical bandsaws) have been manufactured
almost exclusively in Vietnam. Mill expansion
usually involved purchasing addition mills.
Most sawmills also owned circular saws.
These have been introduced more recently for
recutting flitches into sawn timber for furniture
and other end uses. Virtually all mills had
rudimentary saw doctoring capability. The
equipment was purchased new. However,
skills in saw doctoring varied enormously
between mills. None of the mills survey
ed
indicated any modifications to purchased
equipment indicating that in general the saw
-
milling equipment was suitable for the sawing

Peter Vinden, Philip Blackwell
&
Pham Duc Chien
254
of acacias. Only 12% of mills surveyed had
plans to upgrade equipment. Emphasis on
replacement focused on:
Purchasing ver
tical bandsaws because
these were more suitable for sawing
small logs,
Establishing furniture manufacturing
equipment,
Replacing old circular saws.
Further processing undertaken by
sawmills to add value include:
Air
-
drying. Only a third of all sawmills
eng
age in drying.
Kiln drying is undertaken by relatively
few mills, although a number of mills
send their timber to enterprises that
specialise in kiln drying,
Preservative treatment was being
conducted by 13 enterprises
Integration of sawmills into
manufact
uring was reported and focused
mainly on furniture pallet making and
construction.
Those companies involved in kiln drying were
experiencing very serious problems
particularly in relation to drying to a consistent
moisture content and identifying suitable
drying schedules for eucalypts and some native
species. The Australian team observed some
larger enterprises (not covered by the terms of
this survey) that had invested heavily in kiln
drying equipment. These kiln were not
operated correctly and results
for the more
difficult to dry species were unsatisfactory, the
main cause was lack of training of the
operators and limited understanding of the
principles of timber drying. Discussions with
the kiln operators revealed a genuine interest in
learning and
getting an understanding of how
they could improve the quality of the finished
products.
Log storage times at the sawmill were on
average 1 month in the South 1.1months in
Central Vietnam and 0.6 months in the North.
The total elapsed time from tree fellin
g and
transport to the log storage yards was not
identified. However, storage in extreme cases
at the log yard was reported to be as long as 6
months. Strategies need to be implemented to
streamline the logistics of supply to reduce log
storage time partic
ularly given the incidence of
decay that was reported by 29% of
respondents. Log supply was identified as a
problem for 57% of respondents, mainly
because of “availability”. The wet season also
compounded the problem often resulting in a
discontinuity in s
upply. Research needs to
address the whole question of log supply.
Techniques need to be developed to reduce
sap
-
stain including proper housekeeping
techniques at the sawmill to lift logs off the
ground and provide timely rotation of the
stockpile. This i
s needed to avoid the
development of a decay environment in the
yard. The biggest problem (25% of
respondents) in relation to log quality was the
presence of sweep (i.e. bent logs). Inevitably
sweep resulted in the crosscutting of logs into
short lengths.
The most common log length
was 2.4 metres.
An end use analysis of timber derived from the
survey is summarised in table 2.

