36 PalletCentral • January-February 2019 palletcentral.com
Focus on the Pallet Sector
Following three consecutive years of contraction, hardwood
consumption by the wood pallet and container industry rose
8.2% in 2018 to 3.314 billion board feet. It remains the largest
single market for U.S. hardwoods by volume.
Pallet manufacturers that utilize softwoods benefitted from
increased availability the last three to four months. However, as
noted earlier, those that rely on hardwoods for part or all of their
raw material supplies had the opposite experience. In fall and early
winter, poor logging conditions across the Eastern U.S. reduced
hardwood sawmill output and further tightened cant and pallet
lumber supplies.
Amid these market circumstances, prices continued to rise.
All told, hardwood cant prices – averaged across the Northern,
Appalachian, and Southern producing regions – climbed 15% in
2018 and a total of 31% from their mid-2017 lows through the end
January 2019.
Whether or not the U.S. and world economies continue to grow
in 2019, the wood pallet and container industry will seek out the
lowest-cost raw material available. At present, softwood supplies and
prices are trending in the industry's favor, and hardwoods are trend-
ing in the opposite direction. Hardwoods' share of the pallet and
container market appears vulnerable, though low hardwood prod-
uction could sustain cant prices regardless. Only time will tell.
PC
MARKETS
Hardwood Market Report (HMR) has provided weekly price and market information on
North American hardwood lumber and lumber products continually since 1922.
Recognized as the authoritative source of data and market analysis, HMR is circulated
throughout the world in print and via Internet at www.hmr.com. For more information,
email: David Caldwell, Associate Editor, at david@hmr.com; Judd Johnson, Editor, at
judd@hmr.com; Andy Johnson, Associate Editor, at andy@hmr.com.
