Issue link: http://palletcentral.uberflip.com/i/1177710
Focus on the Pallet Industry Demand for raw materials from the wooden pallet and container industry has steadily increased during the last two years. Hardwood Market Report estimates that industry consumption of hardwoods surged 8.2% to 3.314 billion board feet (BBF) in 2018 and increased another 4.9% year-to-date through August 2019. Consumption increased faster than U.S. economic growth because pallet and container manufacturers that depend mostly or entirely on hardwoods were rebuilding depleted raw material and finished goods inventories. This summer and early fall, more and more pallet manufacturers reached raw material inventory goals and transitioned from inventory building to replacement purchasing mode. Some have lowered purchase prices for pallet cants and lumber, while others have not. Broadly speaking, prices stopped rising and started to moderate. Hardwood cant prices – averaged across the Northern, Appalachian, and Southern producing regions – edged up 4% between January and July 2019, and have since fallen about 1%. Still, prices are 34% higher now than when they last bottomed out in mid-2017. palletcentral.com PalletCentral • September-October 2019 31 Supplies of hardwood pallet cants and lumber are now meeting or exceeding demand in much of the Eastern U.S. However, availability will likely tighten back up soon. Wooden pallet and container manufacturers should consider this probability in weighing purchasing decisions in the months ahead. iStockphoto/kotangens iStockphoto/Alberto Masnovo