In January 2021, with the rebound of local epidemic situation in China, China's economy still maintains a rapid upward trend. The purchasing manager index (PMI) of China's manufacturing industry is 51.3 %, which is 0.6 percentage point lower than that of the previous month, and have run at 51% or above for seven consecutive months. In January the wood production and manufacturing industry continued to shrink.Although the production was the same as last month, the number of new orders declined significantly, the inventory of raw materials increased, and the export remained weak. The GGSC-CN comprehensive index for January registered 42.9% (48.4% for last January and 38.3% for January 2019), an decrease of 19.1 percentage points from the previous month. It shows that the operation of the superior forest products enterprises represented by GGSC-CN index shrink from last month. See Figure 1 for more details.

                                                        Figure 1 GGSC-CN index trend from February 2020 to January 2020

Challenges

Ø The price of raw materials is rising and the raw materials are in short supply.

Products in short supply

Oak veneer, Taun,Sven paint, Melamine, Urea

Commodity of which the price has been increased

Taun, Dahoma,Oak veneer,Melamine, Decorative Paper, Formaldehyde, Urea,Epoxy Acrylate

Commodity of which the price has been decreased

Dahoma, Urea

As for the GGSC-CN index, in December 2020, one out of five sub-indexes of GGSC-CN index rose, two flat and two fall.

The production index registered 50.0%, same as the previous month. It shows that the production of superior forest products enterprises represented by GGSC CN has been almost same as last month.

The new order index registered 28.6%, an decrease of 31.4 percentage points from the previous month, reflecting the ability of enterprises to obtain orders is worse than that of last month. Among them, the new export order index reflecting international trade registered 35.7%, a decrease of 4.3 percentage points from the previous month,, showing that orders from abroad this monthis decreased inJanuaryfrom last month.

The main raw material inventory index registered 57.1%, a increase of 17.1 percentage points from the previous month. It shows that the raw material inventory of the superior forest products enterprisesis increased inJanuaryfrom last month.

The employment index registered 42.9%, an decrease of 7.1percentage points from the previous month. It shows that the employment of the superior forest products enterprises is decreased inJanuaryfrom last month.

The supplier delivery time index was 50.0%, same as the previous month. It indicates that the supply time of raw material suppliers of the superior forest product enterprises is almost same as last month.