PETALING JAYA: With more than half of Malaysia’s furniture exports going to the United States, President Donald Trump’s decision to slap 25% tariffs on imported kitchen cabinets, bathroom vanities and upholstered furniture is likely to hit the industry hard.
The local furniture industry is now looking to the government to provide support.
Malaysian Furniture Council (MFC) Desmond Tan said implementing measures such as short-term financing, tax relief, equipment upgrades and export market incentives could help manufacturers navigate these challenges.
Tan said MFC was closely monitoring the developments over the tariff, which begins on Oct 14.
He also said Investment, Trade and Industry Ministry deputy secretary-general Mastura Ahmad Mustafa, the chief negotiator on US tariffs, is seeking tariff exemptions for various products, including furniture.
“We remain hopeful of a positive outcome,” added Tan.
According to the Malaysian Timber Council, wooden furniture exports to the United States reached RM5.71bil last year, accounting for 57.7% of Malaysia’s total wooden furniture exports.
Johor – particularly Muar – produces the bulk of Malaysia’s furniture.
US orders typically consist of bedroom furniture, dining sets and upholstered items such as couches and chairs.
Philip Fong, a director at Mi Kuang Furniture Centre in Johor, said that if raw material costs were to rise due to global factors, local furniture prices could also go up.
“The government can help the furniture industry by helping exporters explore new markets, providing incentives or financial relief to manufacturers, and promoting domestic demand,” he said.
However, he said, there could be a silver lining in Trump’s announcement.
“If exporters see reduced orders from the United States, some of their production capacity may be redirected to the domestic market,” said Fong.
This could lead to increased local supply and cheaper products for customers.
Some furniture exporters are confident demand from the United States will hold firm despite the tariffs.
Muar Furniture Association (MFA) president Steve Ong said that while Trump’s announcement may unsettle the market initially, orders from the United States will continue as American consumers still rely on imports to meet their needs.
In 2024, Vietnam had the largest market share in the United States while Malaysia was in seventh place.
“I think there is still demand for our products there,” he said.
Ong, however, cautioned that furniture manufacturers may adopt a more conservative stance in terms of investment and production for the time being.
“Industry players are already feeling the heat from policies like the Sales and Service Tax (SST) expansion, electricity tariff hikes and Employees Provident Fund contributions for foreign workers, which are set to begin in October,” he said.
“We need friendlier policies that will increase our competitive edge in the global market.”
On Monday, Trump announced 10% tariffs on imported timber and lumber, and 25% tariffs on imported kitchen cabinets, bathroom vanities and upholstered furniture.
The tariff rates start on Oct 14, but the duties will increase on Jan 1 next year to 30% for upholstered wooden products, and to 50% for kitchen cabinets and vanities imported from countries that fail to reach an agreement with the United States.
According to Trump, wood product imports are weakening the US economy, resulting in the threat of closure of wood mills and disruptions of wood product supply chains.
Investment, Trade and Industry Minister Tengku Datuk Seri Zafrul Abdul Aziz has said that Malaysia was actively engaging with the United States on tariff-related issues, particularly tariffs on furniture products.
Malaysia and the United States are expected to sign the Reciprocal Trade Agreement during Malaysia’s chairmanship of the upcoming 47th Asean Summit which takes place in Kuala Lumpur from Oct 26 to 28.
