Wood Container and Pallet Manufacturers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 2,300 wood container and pallet manufacturers in the US produce pallets, shipping crates and cases, barrels, wooden boxes, casks, and parts for wood pallets and containers. Wood pallets used for shipping is the largest product category. Companies produce new wood pallets from raw lumber or recycled wood. Companies also repair and resell used wood pallets. Wood waste from the production process, along with used pallets that cannot be repaired, are typically ground up and sold as mulch, animal bedding, or wood shavings.

Raw Material Cost and Availability

Wood container and pallet manufacturers purchase industrial lumber from saw mills for production of new products.

Pallet Pooling Or Rental

In order to reduce costs and focus on their core business, some customers are opting to rent, rather than own, pallets.

Industry size & Structure

The average wood container and pallet manufacturer operates a single location, employs 26 workers, and generates about $4-5 million in annual revenue.

    • The wood container and pallet manufacturing industry in the US consists of about 2,300 companies with annual revenue of $10 billion and 59,900 employees.
    • The industry is highly fragmented: the largest 50 companies account for only 39% of industry revenue. Due to shipping costs, companies typically serve customers within 150 miles of their production facility.
    • Between one and two billion wood pallets are used annually in the US for shipping goods. The majority of these pallets are used pallets.
    • Firms typically manufacture new pallets and also repair and recycle used pallets. Some firms also rent pallets to customers.
    • The states with the largest number of wood container and pallet manufacturing facilities are California, Pennsylvania, Ohio, Texas and Illinois.
    • The largest new wood pallet manufacturer in the US is PalletOne, Inc., headquartered in Bartow, FL.
                                  Industry Forecast
                                  Wood Container and Pallet Manufacturers Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  Mar 27, 2023 - Lower Lumber Demand May Have Minimal Effect on Prices
                                  • North American lumber consumption is expected to decline by about 7% in 2023, but that may not have much of an effect on pricing, according to a lumber analyst with Forest Economic Advisors. Lumber demand is softening as high interest rates and elevated home prices slow the housing market. Remodeling boomed during the pandemic, but home improvement spending is projected to fall as much as 8% from its peak during the health crisis. While lumber demand is forecast to drop, supplies in key producing regions, including British Columbia and the US West Coast, are tight. Meanwhile, sawmills are curtailing production or even closing mills, while new planned mills are slow to come online. Lumber prices may be held in check by softening demand, tight supplies, and high inventories on the retail level.
                                  • US manufacturers’ shipments of durable goods, a demand driver for wood containers and pallets, decreased 0.6% in February from the previous month and were up 4.7% compared to February 2022. New orders for durable goods, a signal of future pallet and wood container demand, fell 1% in February from January but rose 1% over February 2022 levels.
                                  • Supplies of used pallets, which were often hard to come by due to the pandemic, are returning to the market, according to Chaille Brindley, VP of Operations for Industrial Reporting Inc., the publisher of Pallet Enterprises Magazine. Retailers that built up extensive inventories during the pandemic have been liquidating their stocks, which has loosened supplies of pallet cores (a “core” is a post-retail used pallet no longer in use or in need of repair). Brindley notes that if the US economy slows, the reduction in pallet demand will likely reduce pallet core prices.
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