Profits across China’s wood processing and furniture industries fell sharply over the first four months of 2026, even as the country’s broader industrial base posted double-digit growth, a split that exposes how weak demand for timber and building products has become inside the world’s second-largest economy. That is according to the National Bureau of Statistics of China, whose latest release shows the two wood-reliant sectors moving in the opposite direction to almost everything around them.
China’s industrial firms booked combined profits of 2,435.84 billion yuan between January and April, up 18.2 per cent on a year earlier, with April alone delivering a 24.7 per cent surge. Operating revenue across the sector reached 44.89 trillion yuan over the same window, a 5.2 per cent gain, whilst the operating profit margin widened to 5.43 per cent, up 0.60 percentage points.
Against that backdrop, the wood processing and wood, bamboo, rattan, palm and grass products category saw profits drop 22.8 per cent to 4.07 billion yuan, with revenue down 14.9 per cent to 204.10 billion yuan, whilst costs fell 14.7 per cent to 187.54 billion yuan. The near-matching falls in revenue and costs point to a sector squeezed on volume rather than margin, with output draining away faster than producers can trim their books.
Furniture manufacturing fared worse still, with profits more than halved at a 54.4 per cent fall to 2.67 billion yuan over the four months. On the revenue side, furniture makers shed 10.7 per cent to 169.58 billion yuan, whilst costs eased only 10.5 per cent to 141.39 billion yuan, leaving factories to absorb the shortfall straight out of earnings.
The pressure ran well beyond the timber line into the materials that go up alongside it, with non-metal mineral products — the category covering cement, glass and other construction inputs — recording a 50.7 per cent profit collapse to 16.85 billion yuan. Revenue there fell 9.9 per cent to 1,242.11 billion yuan, whilst costs fell 9.6 per cent to 1,070.90 billion yuan, a reading that ties the wood and furniture weakness back to a property and construction sector still short of momentum.
The split has a name among economists watching China’s factory data, with the Economist Intelligence Unit’s Tianchen Xu attributing the headline surge to upstream pricing and an artificial-intelligence boom whilst downstream makers absorb the cost. “Profit divergence is pronounced,” said Xu, who pointed to the “involution,” or cutthroat domestic competition, now squeezing consumer-goods manufacturers, including the furniture lines.
For timber exporters who count China among their largest customers, the numbers carry a clear warning, since a furniture industry in retreat and a wood processing base shedding revenue both buy less raw material from offshore mills. The contraction sits awkwardly against the 18.2 per cent rise in profit booked across the Chinese industry as a whole, a sign the country’s building economy is trailing well behind its factory floor.
The National Bureau of Statistics put the wood processing sector’s revenue decline at 14.9 per cent across the four months to April, the steepest decline among the three building-linked categories, and a figure that leaves little doubt about where China’s construction slowdown is biting hardest.
