New commentary from Fastmarkets highlights several shifts now shaping wood pallet procurement in the food and beverage (F&B) sector. These trends, ranging from evolving retail patterns to lumber-market volatility, echo what pallet buyers and recyclers have been reporting throughout 2024 and into 2025.
They also align with recent academic research, including Virginia Tech’s latest pallet market study, which observed a continued shift toward softwood and a correction from the extremes of the pandemic lumber cycle. Below, RPN summarizes the key themes emerging from Fastmarkets’ analysis and adds context from industry conversations, pallet market data, and reusable packaging programs.
Retail and E-commerce Trends Continue to Disrupt Forecasting
Fastmarkets notes that retail behavior in the F&B channel has changed dramatically since 2020. Online ordering of groceries and beverages—once a niche—remains structurally higher. This has raised demand for pallets capable of moving more mixed SKUs, greater cube density, and more frequent touches.
Seasonal patterns have shifted as well. According to Fastmarkets, early holiday ordering linked to tariff uncertainty created midsummer surges in pallet demand during 2024. F&B suppliers relying on historic order curves have found themselves short during unseasonal peaks and overstocked during quieter periods.
For pallet buyers, the lesson is straightforward: forecasting now requires tighter alignment between sales teams, retail partners, and pallet suppliers. Companies sharing expected volume swings with their pallet vendors—especially recyclers—generally experience fewer shortages during peak weeks.
Lumber Volatility Remains the Wild Card
Fastmarkets reiterates what pallet buyers know well: pallet prices follow lumber prices. Because low-grade material used for pallets is tightly linked to the housing sector, a soft construction market has helped keep pallet material more stable. But that can change quickly. The 2021–2022 spikes in framing lumber still loom in buyers’ memories.
One structural trend continues: the industry’s migration from hardwood to softwood. Virginia Tech’s research confirms the same shift, with Southern Yellow Pine increasingly displacing traditional mixed hardwoods in many regions. The drivers include cost, availability, and mill efficiency, but the effects vary by application. Softwood tends to be lighter and more uniform, but some beverage applications still prefer the rigidity of hardwood.
Ultimately, pallet buyers should expect continued variability. Even modest changes in housing starts can move low-grade pricing, leading to swings in pallet costs, especially in the recycled market, where core availability plays an additional role.
What Flat or Uncertain Markets Mean for Pallet Strategy
The broader economic environment described by Fastmarkets such as muted construction, uneven retail, and unpredictable e-commerce, creates wrinkles for pallet buyers attempting to plan inventory, equipment cycles, or repair levels. Recyclers, in particular, report that irregular retail and import patterns have made recycled core supply less predictable than a decade ago.
In these conditions, procurement teams benefit from diversifying their sources, deepening supplier communication, and planning for broader price bands than in past years. Pallet programs built on “just-in-time” assumptions are becoming harder to maintain.
The Reusable Pallet Angle: Insulating F&B Supply Chains from Price Swings
As a publication focused on reuse, RPN would be remiss not to highlight one additional and often under-discussed strategy. In supply chains where it is practical, including many closed or semi-closed F&B loops, reusable pallet systems offer a way to temper the impact of volatile lumber costs. We already see significant activity in this direction, particularly in the UK and some of the European markets.
Durable plastic or engineered wood pallets shift the cost structure away from the spot market for lumber. Instead, cost per use is dominated by reverse logistics and asset management. In many F&B systems, particularly beverage and dairy, a long-life pallet managed in a closed loop can produce a significantly lower cost per trip compared to the ongoing expense of replenishing recycled 48×40 pallets.
Reusable pallets will not fit every application, and they come with a learning curve and new or altered front-line requirements. However, and especially during cycles of lumber volatility or retail unpredictability, they can offer buyers both price stability, performance consistency and overall lower cost.
What Procurement Teams Can Do Now
- Align forecasting with retail dynamics: earlier peak order cycles require closer communication with suppliers.
- Watch lumber indicators: housing starts and framing lumber composites remain critical signals for pallet pricing.
- Evaluate softwood vs hardwood performance: especially for heavy, dense F&B loads.
- Consider reuse where feasible: durable pallets can reduce exposure to lumber swings.
- Strengthen supplier relationships: shared forecasting reduces the risk of shortages and premium pricing.
As Fastmarkets’ analysis underscores, the pallet market entering 2025 is stable but far from predictable. Buyers who combine good data, flexible procurement strategies, and a long-term view of total cost per use will be best positioned to ride out whatever the next cycle brings.
RPN will continue to track pallet market movements and the implications for reusable packaging programs. For more on related topics, see our coverage of pallet materials, softwood trends, and reusable pallet economics.
Rick LeBlanc, EMBA, is the founder and editor of Reusable Packaging News (subscribe to the free newsletter) and editor of Western Pallet Magazine. A supply chain journalist with more than 30 years of experience, he specializes in pallets, reusable packaging, material handling and related operations. Rick is co-author of Pallets: A North American Perspective and Pallets & Progress: A Collected History of Pallets and Palletized Handling 1922–1945. He is also an advisory board member of the Virginia Tech Center for Packaging and Unit Load Design. Read Rick’s full bio.
