What's Happening?
Italy's luxury furniture sector is experiencing a downturn as exports to China have decreased by 9.9% in the first nine months of 2025, amounting to €320 million. This decline is attributed to reduced
Chinese demand for foreign luxury goods and increased tariff pressures. Despite this, Italy's overall furniture exports have remained relatively stable at €14.2 billion, with slight decreases in the U.S. and France, and a minor increase in Germany. The slowdown in China is linked to broader economic and real estate challenges, which, along with trade policy issues, have affected luxury spending. FederlegnoArredo, the Italian wood supply chain consortium, is advocating for the European Union to expedite a trade agreement with Mercosur to potentially offset losses in the Chinese market.
Why It's Important?
The decline in Italy's wood exports to China highlights the vulnerability of the luxury market to global economic shifts and trade policies. As China is a significant market for luxury goods, a decrease in demand can have substantial impacts on European exporters. The push for a trade deal with Mercosur reflects a strategic move to diversify markets and reduce dependency on China. This development is crucial for stakeholders in the luxury furniture industry, as it may influence future trade strategies and market focus. The situation underscores the importance of adapting to changing consumer demands and geopolitical landscapes.
What's Next?
FederlegnoArredo is closely monitoring global trade developments and is hopeful that the EU-Mercosur trade agreement will be finalized soon. This deal could open new opportunities in South American markets, providing a buffer against the losses in China. The agreement, expected to be signed by President Ursula von der Leyen in Brazil, aims to establish one of the world's largest free-trade areas. The outcome of these negotiations will be pivotal for the Italian luxury furniture sector, potentially reshaping its export strategies and market priorities.
