For over 30 years the leading pallet and sawmill magazine in America.
Letter from Ed: Charting Pallet Industry Trends, Pallet Profile Celebrates 30th Anniversary
My first involvement with the pallet industry was starting the Wooden Pallet Index, now called the Pallet Profile Weekly, on March 30, 1977.The Index readership grew over time. Today, the Pallet Profile has nearly 758 subscribers.
By Edward C. Brindley
Date Posted: 4/1/2007
What a ride the last 30 years have been! Where in the world did the time go? While the industry seemed to be fairly static at times, change has always been in the wind. Now the wind has become a hurricane as change comes along fast and furious.
My first involvement with the pallet industry was starting the Wooden Pallet Index, now called the Pallet Profile Weekly, on March 30, 1977. I met around a table at the Commonwealth Club in Richmond with eleven owners of the most prominent pallet manufacturers in Virginia. These eleven people each agreed to subscribe to my new report. The Index readership grew over time. Today, the Pallet Profile has nearly 758 subscribers.
In this stroll past the last 30 years, I will use the Virginia hardwood cant data as a reference. Going back to the beginning, we have more complete data on this state than any other area. In 1977, Virginia hardwood cants cost $120/M in 1977. We sure haven’t seen a number like that in a long time.
Over the next several years, our reporting regions extended to cover most of the United States, including nine hardwood regions and three western softwood regions. Cant prices moved higher to hit $160/M in 1978. By the end of 1980, cants were back down to $140.
Through the years, the Index became a valuable barometer to identify unavoidable price variations. Our readers stayed in the know and were able to justify price fluctuations to customers. Sometimes the industry had relatively stable pricing, particularly in hardwoods. But when prices move up, they move up.
While there is not much our industry can do to affect these changes, we can document them. It is true that the greatest variation in price changes has been in our Western low-grade softwood prices because that is the inherent nature of softwood markets. However, in some ways changes in hardwood pricing are even more important because they are less common and a little less consistent.
By the fall of 1984, cant prices edged up to $172 but fell back down to $145 by the early spring of 1985. The pallet industry continued its significant growth throughout the 80s, and pallet recycling grew from almost its conception into a major segment of the pallet industry.
The Index reported on major industry changes, such as the announcement in 1990 that CHEP would launch a U.S. pallet pool. The November 22, 1991 report carried a lead editorial that characterized the changes in our industry. It stated, “In the late 70s and early 80s we heard slipsheets until they were coming out of our ears. Then it was plastic pallets and containers for the automotive industry. More recently it has been expendable platforms and third party pallet management, including rental.” Change was building as time marched on.
In September, 1992, the report underwent another design change and expanded the number of hardwood reporting regions. The name changed from the Wooden Pallet Index to the Pallet Profile Weekly. Cant prices moved upward to $220 that year. It happened about the same time that Jeff McBee joined our staff to become our full-time market analyst.
Cant prices skyrocketed to $290 by the late spring of 1993. The industry had experienced its greatest climb in hardwood prices ever, and we were there to cover it week by week for our readers’ benefit. By the end of 1994, cants had dropped back to $255 and then $235 in late 1995; hardwood was beginning to show some of the roller coaster tendency of a softwood market.
The recycling industry grew at around 20% per year throughout most of the 90s. The trend toward pallet companies starting to network together, through organizations such as Pallet Pallet, signaled a change in the structure of pallet companies.
Very unexpectedly, Martin Lumber in Concord, Ark. closed its doors in 1995 after 99 years of being in business. Cracks were beginning to show in the stability of our industry as changes quickly brought down an established Midwestern pallet company.
Hardwood prices stayed stable until September when another ride to the top of the roller coaster began. By the summer of 1998 cants hit $300 for the first time. Prices peaked at year’s end and dropped to $255 by the spring of 1999. Prices started back up in 2000 and hit $282 by the end of 2000. Prices started back down in early spring of 2001and bottomed at $260. Late in 2001, the phytosanitary issue appeared on the international shipping scene. Again a major change developed in our industry.
Cant prices started back up during August 2002 and gradually climbed over the next two and a half years to the $330 mark at the end of 2005. While upward pressure has remained on the market and a few higher prices have been registered, hardwood cant prices have been fairly stable since late 2005.
The Pallet Profile Weekly includes hardwood and softwood pricing as well as a market column explaining changes and activity in the market.
For many readers, our editorial coverage has become just as important as our market data. Several editorial topics have appeared many times as we have kept readers abreast of what is going on in the phytosanitary arena, the war over Canadian softwood exports to the U.S., mergers and closings, environmental regulations, and legal developments in the court battles over the handling of rental pallets. Each week, the Profile gives managers and executives the information they need to know to stay competitive.
It is with great joy that the Pallet Profile Weekly is celebrating its 30th anniversary in April of 2007. Our staff has grown in knowledge and influence as we have served our friends in the pallet industry.
Any readers of the Pallet Enterprise who have not enjoyed the benefits from subscribing to the Pallet Profile Weekly should call and speak with Jeff at 800/804-0263. Ask Jeff about the Recycle Record, our monthly report for pallet recycling. He will be glad to explain the benefits of our services and send you complimentary samples.
Thank you for being a loyal reader of the Enterprise. Many of our pallet friends have said that the Profile is the most important publication to read in the pallet industry. If you think the Enterprise is good, you should check out what the Profile has to offer.