Woodcarving has been removed as of 3.13.Edit
Woodcarving is a skill used by the player to carve decorations on a wooden object to make its value increase when trading.
The skill proficiency affects the quality of the decoration, and if too low will give no effect. It can even ruin the item, make it worthless for trade.
Two requirements must be fulfilled to carve an item:
Having a carving item in the hand (like knives, or axes) Target a wooden item Items can be carved only once, whether the carving is successful or not. There is currently no indicator of an item's quality. However, you can watch the right hand box to see the game evaluate the quality of action. You also can drop all the carved items of same thing on the ground to be sorted into stack of each quality. And when you offer them whole stack to buyer/seller, but wont accept the deal, the items also will be sorted into stacks.
Blocks of wood and wooden stakes (and maybe another wooden thing too) are items which can be carved unlimited times. How? Let's say that there are 6 uncarved blocks of wood on the ground. Take 4 of them - important: don't pick them all up. Carve picked blocks and drop them to the tile where is rest of uncarved blocks. Press pick command and this will be displayed: "Select items to pick up? (a) some blocks of wood (6)" - as you see they are all together as 1 item in the amount of 6. You can repeat this as long as you want. This trick/bug is good for training woodcarving without worrying about amount of wood.