The 2 Billion Pallet Man

U.S. Pallet Industry Statistics Presented at Western Pallet Association Annual Meeting

 

“You may have heard reference to there being 2 billion pallets in the U.S.,” Philip Araman told the audience at this year’s Western Pallet Association Annual Meeting. “That number comes from us.”

Indeed, reference to the 2 billion pallets estimated to populate the U.S. pallet pool seems to find its way into most every pallet industry business case and analysis as ambitious projections about potential market capture are made for new pallet products and services poised to transform the market…but is it accurate? I asked Phil, and he assured me that the 2 billion pallet estimate is relatively accurate, based on their research, although that research has never been published.

Phil Araman, U.S. Forest Service

Phil Araman, U.S. Forest Service

Phil is a researcher for the U.S. Forest Service in Blacksburg, Virginia. The group works closely with Virginia Tech.

“We (US forest Service/VA Tech) have many years of working with your (pallet) industry,” Phil told the group. Their research involves monitoring new pallet manufacturing, pallet recovery/repair/reuse/recycling, as well as waste pallets to landfills. Additionally, the group performs research to support pallet design software PDS and Best Pallet to make better pallets.

Based on surveys and estimates, his research group has generated the following numbers with respect to the U.S. pallet industry:

  • Could be over 2 billion pallets in service
  • 416 million new pallets made in 2011
  • 43 out of every 100 pallets purchased are recovered pallets
  • 474 million pallets recovered in 2011
    • 326 million of those returned as pallets
    • The remaining 148 million were recycled to other products
  • Millions still end up in landfills every year
    • About 1/4th of these are recycled at landfills

Here are some of Phil’s noteworthy visuals from his presentation.

New Wood Pallet Production

us new pallet productionAs the graph at right shows, new wood pallet production has been rather flat, registering 416 million units in 2011.

Recovered Pallet Production

Meanwhile, recovered pallet production has grown dramatically in recent decades as shown by the graph at left below.

 

recovered pallets sold

Overlay the new pallet production with recovered pallet sales, and you can see at lower right how the recovered pallet sales have rapidly closed the gap on new pallets. This slide, Phil said in his presentation, is very powerful.new vs recovered pallets

So what does it all mean? Given that wood pallets still command over 90 percent of the market, if we can believe that number, it gives us a sense of the overall market. The growth of recovered wood pallet sales indicates their acceptance by the market as the quality of used pallet offerings has continued to improve, providing a better value proposition for many users.