The Upgrading Journey of a Log: Linyi Pingyi’s Wood Industry Aims for 50 Billion Yuan

2026-09-20 Source: Jiemei Shandong

“Lucid waters and lush mountains are invaluable assets.” Nestled in the heart of the Yimeng Mountains, within Pingyi County that stretches across the Qilu region, three industrial sectors have been designated by Linyi City as “flagship industrial chains.” One of these links raw logs and lumber products in the factory workshops.

The wood industry carries the “weight” of Pingyi County’s economy. The county is home to 146 large-scale wood enterprises, accounting for 42% of all such enterprises in the county, and has established a complete industrial chain spanning from log imports to smart home products. By 2025, the output value of large-scale wood enterprises in Pingyi is expected to exceed RMB 20.5 billion, representing 41.4% of the county’s total output value of large-scale industries, with both its growth rate and incremental contribution ranking among the highest in the city.

Pingyi’s uniqueness lies in its attempt to address a challenge that most traditional wood‑industry clusters have yet to truly solve: how to ensure that, once a log enters the factory, it leaves with significantly higher added value.

For a long time, Pingyi’s wood industry has functioned as a “production‑capacity workshop.” The companies have the equipment, the workers, and the orders, yet their products bear other brands, with the bulk of the profits going to the brand owners. A raw log, after being cut, pressed, and veneered into a sheet of board, sees a price gap between its factory gate and the final retail price—this is the “brand premium” that Pingyi’s wood firms have been contributing to others for years.

The direction of transformation is clear: shifting from OEM/ODM manufacturing to building our own brands, moving from basic panel products to functional solutions, and transitioning from single‑item processing to whole‑house customization.

At this year’s conference on advancing the high-end panel and green smart home industries in Pingyi County, County Party Secretary Zheng Xiyuan emphasized that “the high-end panel and green smart home industrial chains must deepen the integration of the ‘three chains’—industrial chain, innovation chain, and value chain—while driving four major breakthroughs: shifting from front‑end to back‑end production, from formaldehyde‑based to formaldehyde‑free products, from single‑product operations to cluster‑based development, and from OEM/ODM to independent brand creation. During the 15th Five-Year Plan period, the goal is to propel the industry into a 50-billion‑yuan‑scale industrial cluster.”

A brand’s confidence stems from technology. In Pingyi, local authorities have facilitated partnerships between wood‑processing companies and universities and industry‑focused research institutes, helping them overcome key technical challenges such as formaldehyde‑free processing and flame‑retardant, water‑resistant treatments. Xincheng Wood Industry has adopted cold‑press drying and a formaldehyde‑ and benzene‑free additive process to develop multifunctional, eco‑friendly panels that are both waterproof, fire‑proof, and insect‑resistant, expanding their applications beyond interior decoration into sectors with even higher performance requirements.

Going global is another viable path. In response to the EU’s carbon border adjustment mechanism and U.S. trade barriers on forest products, Pingyi has helped 80% of the region’s wood‑processing enterprises upgrade and modernize their equipment. Twenty-two leading companies have obtained FSC forest certification and met CARB formaldehyde emission standards, resulting in a 15% to 20% increase in unit product prices. Additionally, Pingyi has established a building‑materials showroom in Saudi Arabia, piloting a “local order‑taking, direct overseas shipping” model that has reduced logistics costs by approximately 30%.

From “waiting for orders” to “building distribution channels,” Pingyi’s wood industry is expanding its horizons from the local Linyi market to overseas end‑consumer markets.

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Editor: Si Yan