If you buy new or recycled wood pallets you’ll surely have noticed an upward price trend over the last year. Depending on whether it’s new or recycled pallets some prices have nearly doubled! You may be wondering what’s causing the rise in prices in Tampa and Atlanta.
First, if you’re buying new pallets they’ll typically be made from either softwood lumber such as pine or mixed hardwood species such as oak, ash and maple. Each has its own market and prices move somewhat independently of the other, although the price of softwood does indirectly affect the price of hardwood lumber.
Because of the housing boom and COVID-related mill closures southern yellow pine pricing has doubled in the past year. It’s simple economics: supply and demand. Mill closures and slowdowns have reduced the supply while demand for new softwood lumber has only increased over the last year.
Hardwood pricing has trended upward in part due to particularly wet weather in the Southeastern US. Because wet forests make logs harder and more expensive to get, the supply of hardwood lumber has tightened over the past year. In addition, pallet lumber is lower grade lumber that competes with other industries such the oil and gas industry as well as railroads, which need constant supplies of crossties for routine track maintenance.
What about recycled pallets? Well, because new pallets have become more expensive some end users have switched to recycled pallets, either as a necessity to keep an available supply of pallets or to simply reduce pallet purchase costs. Since recycled pallets start out their life cycle as new pallets a reduction in new pallet production ends up reducing the available pool of recycled pallets down the line.
Clever pallet producers, like Premier Pallets, can re-engineer pallet designs to maximize pallet functionality while wring out extraneous costs. In Tampa and Atlanta Premier has taken what is considered a stodgy business (pallets) and creatively saved its customers thousands of dollars via a robust pallet yard network and creative solutions to pallet shortages.
Contact us at Premier Pallets to find out if we can help improve your pallet purchasing in Tampa and Atlanta today.