As we look back at 2021, the availability of lumber used to make wood pallets has been a roller coaster of supply and pricing that made many of us pretty dizzy.
The good news is that many experts see things smoothing out for pallet buyers during the second half of 2022…but we’re not out of the woods yet. And so it’s a great time to look back on what the year has brought and what next year might have in store for us.
Looking Back: Lumber was Available but Challenging
The skyrocketing prices of lumber eased up a bit over the summer. But prices are creeping up again as supplies have become tighter at the end of 2021.
The reasons for this are varied, and in some cases are a lingering effect of the pandemic. The causes include:
- Labor shortages in all industries, from lumber milling to trucking, are affecting the cost of lumber, according to Fortune. They estimate that prices have risen 120% in recent weeks.
- An increase in the number of people who want to build houses and need LOTS of wood. The Wall Street Journal noted that the US Housing market is nearly 4 million homes short of what the buyers are demanding.
- Wildfires in the northwest US and in British Columbia devastated millions of acres of trees. To add insult to injury, British Columbia received record rainfall in November, causing flooding and mudslides. Many vital roads, bridges and tracks to transport the lumber were washed out completely.
Wood is still the dominant material used in pallets because it is easy to work with and affordable. Many logistical experts recognize that wood pallets are far easier to store and move. And that looks to be consistent in the year to come.
Looking Forward: Packaging and Pallet Trends for 2022
The Bureau of Labor Statistics’ Producer Price Index saw the demand for wood pallets rise sharply last year. Expect that trend to continue as companies continue to clamor for pallets to keep pace with consumer spending.
In addition to the demand for wooden pallets, many experts think there are some other trends that will affect the pallet and packaging sector into 2022.
- Rise of sustainability concerns. Both industry and the consumer are more concerned with using sustainable practices. While many companies are just now considering which practices to use, Hope Timber has been using sustainability as a business model since 1995. With pallet recycling and remanufacturing, we turn damaged pallets into usable ones or we create mulch from those that can’t be recycled. Even the nails holding pallets together are recycled instead of going into the landfill.
- Increased interest in returnable packaging. In a global returnable marketing forecast through 2026, the demand for returnable packaging will rise dramatically. Hope Timber encourages this practice. We recycle and reuse our wooden pallets as part of our regular business practice, which keeps costs to a minimum.
- More packaging automation with machinery. Labor shortages will most likely continue across all sectors, while at the same time the boom in online buying habits is expected to continue. Having full or partial packaging automation will continue to increase as a way of increasing production while reducing excess waste at the same time.
- Supply chain issues until the second half of 2022. A recent report predicted that supply chain issues may ease up in Q3 due to supply catching up with demand. Hope Timber owns its own fleet, so we have been able to control our delivery times. Having more capability has been beneficial to our customers. As we enter early 2022, we predict this will continue.
While we can’t predict the future, we look forward to serving our customers with the same great service and products.
Hope Timber Pallet serves all of central Ohio and surrounding areas with a fleet of more than 100 semi-trailers that pick up and deliver pallets of all sizes. If you would like to talk pallets, please contact Hope Timber Pallet or call (740) 344-1788.
