22 WESTERN PALLET
Ripple Effects:
Exploring Economic Indicators Impacting the Pallet Industry
Where is the wooden pallet industry now and what’s next? Chaille Brindley recently dove into crucial economic indicators and how their ebb and flow can influence the pallet industry in the June WPA webinar. The title of his presentation was Ripple Effects: Exploring Economic Indicators Impacting the Pallet Industry, and it was must-watch viewing.
Brindley, the editor and publisher of Pallet Enterprise magazine plus Pallet Profile Weekly and Recycle Record market reports, looked at various factors influencing the pallet industry, including trucking, housing activity, consumer spending, and more.
The current state of the pallet industry
Brindley took attendees for a brief walk down memory lane. In March or April of 2020, the economic indicators were bleak. “It looked like the whole ship was ready to go down,” he said. But it didn’t. “Consumers opened up their pocketbooks and that unleashed a two year period in our industry that was unprecedented,” he said. “I would call it the Roaring 20s for the pallet industry, so to speak.” He called it the best two years in the history of the pallet industry.
Fast forward to the summer of 2022, and pallet companies were still in the driver’s seat “in a way they had never been before.” They could still pass along cost increases to customers and hold profit margins. In the second half of the year, demand started to fall.
Many pallet suppliers initially welcomed the lull after running flat out for that two-year period, but the market continued to soften. Now, Brindley commented, pallet buyers are back in the driver's seat, as they have been for most of the industry’s history. Industrial Reporting is hearing from pallet suppliers that their sales are down from 10% - 30%.
An online poll of attendees at the event was also taken, with 61 responses. One question asked what has happened to pallet demand for the respondent’s pallet company business and their local market over the past six months. Not surprisingly, 80% of businesses said that pallet demand was down. For 50% of respondents, pallet demand was down more than 10%