FURNITURE for the export market worth more than RM200 million is stuck in factories nationwide due to the total lockdown imposed from June 1 to June 14, said manufacturers.

The furniture, packed in 2,565 containers ready for export, cannot be transported to the port due to the standard operating procedures (SOP), which do not list manufacturing furniture as an essential service, said industry players.

Malaysian Furniture Council president Khoo Yeow Chong said they are now seeking help from the government departments to overcome the problem, especially given that export orders have increased in the past year.

“With Europe and the United States gradually opening their borders, it is expected that this year’s export demand will further increase,” Khoo told The Malaysian Insight.

“Yet at the moment, things don’t look good for this sector with 2,565 containers of furniture with a total value of RM213 million lying idle in our factories.”

The government imposed a two-week total lockdown to curb the rising number of Covid-19 infections and deaths. Only 17 essential service sectors remain open during this period.

By-and-large, manufacturing was not allowed to operate during the first phase of the total lockdown period, except for 12 services running at 60% capacity.

These included aerospace (components and maintenance, repair and overhaul); food and beverages; packaging and printing materials related to food and health materials only; personal care items and detergents; electrical and electronics; oil and gas including petrochemicals and petrochemical products, as well as textiles for the production of personal protective equipment (PPE).

Kuala Lumpur and Selangor Furniture Association president Matthew Law said MCO 3.0 is different compared to the first MCO in March last year.

“At that time, almost all countries in the world had closed their borders. Today, our country’s borders are still closed, while others are gradually opening up.

“This has put our country’s furniture industry in competition with other furniture exporters,” Law said.

He also raised the long-term issue of manpower shortage in the sector that adds to the burden of furniture manufacturers to decide on accepting more overseas orders.

“The furniture industry here lacks 20,000 workers and the government does not want to bring in new migrant workers. Locals are not interested in working in furniture factories, they perceive it to be difficult.

“Furniture manufacturers are willing to develop according to the industrial revolution 4.0, but some wooden furniture cannot be completed mechanically.”

Malaysian Furniture Council deputy president Eric Lee said the total lockdown will cause revenue to drop by RM500 million.

He calculated this based on last year’s RM10 billion export market.

“Under the total lockdown, only the production of furniture for medical use can operate,” Lee said.

He also said the manpower shortage in the industry is critical and there is “snatching” of employees among furniture manufacturers.

“When migrant workers head to other factories, they become illegal labour.

“Yet, when this factory offers RM1,200 as salary, and another factory is willing to pay RM1,400, they are willing to venture into illegal labour.

“We really cannot hire the locals. We have even moved the factory to Terengganu because there are employees there who don’t want to work in other places,” he said.

Lee said the government’s help in solving the manpower shortage for the industry will benefit the country.

“The export volume for each year is not limited to RM10 billion, it may double or more because there has been stable growth in overseas orders in the past two years.

“For now, furniture manufacturers are holding back and do not dare pick up orders because of manpower shortage,” Lee said.

Muar Furniture Association president Steve Ong said 90% of production from the Muar furniture factories are for export with up to 8,000 containers going overseas each month.

In recent months, he said exports have fallen by 30% due to the restriction orders and the shortage of containers.

He hopes that overseas customers can understand the delay as Malaysia continues with more stringent restrictions.

“When we finally find containers to export the furniture, we face other restrictions.

“We are worried that customers will cancel orders, and furniture operators may also face the problem of late delivery compensation,” Ong said.

Muar Furniture Association was founded in 1983 and has survived for 30 years.

He said the United States accounted for 60% of the exports. The country also exports to more than 120 countries including those in Europe and Asia.

Ong said the severe shortage of manpower has been ongoing for the past 10 years and although the government encourages the automation of furniture factories, some wooden furniture still requires the hand of skilled craftsmen.

“Even for a major industrial country like Germany, it is difficult to fully develop mechanical production. A chair’s curved angle still needs a human touch,” he said.

Ong also said manufacturers here have a long list of orders till 2022, largely due to the trade war between China and the United States, and the huge demand for home office models under the new normal.

However, the government’s policy is unstable, Ong said.

“The manufacturers are only using the current human resources to drive orders.

“There are only 270,000 people in Muar, and there are various other factories being set up here, which makes it difficult to recruit locals,” he said.

Earlier, his association had worked with the Social Security Organisation (Socso) to recruit locals, only that the situation was not ideal, because not many wanted the jobs on offer.

“The white-collar workers are not willing to settle for a lower salary of blue-collar workers,” he said.

Ong appealed to the government to develop a long-term plan for the furniture industry.

“Otherwise, investors will step back,” he added. – June 11, 2021.