Pallet was an easy and inexpensive item in the supply chain to produce, has now in this pandemic period, it has become more difficult and costly to manufacture.
HERE IS WHY?
- Lack of labour
Since the beginning of pandemic in India, March 2022, the wood manufacturing sector last more than thousands of labours. This means, there are fewer loggers and mill work to produce quality pallets.
2. Lumber Shortage
While there are plenty of logs across the country, pandemic induced business closure forced large lumber mills to shut down, which contributes large shortage to importing to India. Soaring demand and low supply have driven up prices and increased lead time for lumber. This lead to triple the prices of the soft wood lumber in India.
3. BREXIT Impact
UK’s BREXIT transition period of 31st January 2020, high global demand diverting timber from Scandinavian and German saw mills and nearer to home, the ongoing back log of felling license in Ireland, which is causing concern about the availability of logs from last year to 2021.
4. USA, Canada Impact
Since 2018, punch of environmental harms worsened by climate change has devastated the lumber industry in Canada. The outbreak of bark-eating beetles, followed by series of historic wild fires, have led damage in British Columbia, a crucial lumber province.
Americans have, in effect, made a dash for lumber at the exact moment Canada is least able to supply it.
https://www.latimes.com/business/story/2021-05-12/lumber-prices-risingConclusion:
With available less labour and scarce lumber, pallet prices have hit record high. Nail and other fastner material have also risen sharply in cost.
According to the recent article in Economics Times, shows the price approach of pallets globally.
https://economictimes.indiatimes.com/small-biz/trade/exports/insights/the-forgotten-shipping-pallet-stages-a-pandemic-era-rally/articleshow/81999870.cmsExpert Value Pack LLP has taken steps to ensure that, we can maintain a ample supply of pallets for our clients, through tenacious pre-buying has helped to mitigate some of the market challenges. The reality is that raw material have diminished, which has affected lead time and pricing. In this challenging times, we will get through this TOGETHER.
We are happy to continue discussion regarding this subject.
