Like most industries, the global pallet industry faces a high degree of uncertainty due to the ongoing coronavirus pandemic. However, in the short term, the pallet industry is likely to be less impacted than many others, due to the essential nature of pallets, according to a market report from The Freedonia Group.
Sustainability Among Decision-Making Considerations
Pallet manufacturers and users are increasingly considering sustainability factors as they make decisions on materials and products, particularly in high-income countries. Emphasis on environmental issues is expected to benefit producers of plastic pallets, as these are long-lasting products that can be made with 100% recycled material. Similarly, corrugated and molded pulp pallets are desirable for their low environmental impact. However, wood pallets will continue to dominate the global market.
Wooden pallets are by far the most common type of pallet, accounting for 92% of unit demand and 83% of sales in value terms in 2019. Plastic pallets are a distant second. Wood pallets account for the vast majority of pallet consumption in every major pallet market around the world, as these products have a strong combination of cost efficiency and performance. Other types of pallets are largely limited to niche uses.
Global demand for wood pallets is forecast to rise 3.7% per year to 5.8 billion units in 2024, valued at $52.5 billion. Manufacturers choose either block or stringer pallets based on considerations like compatibility with automated systems, general ease of handling, customer requirements, and load capacity. Stringer pallets account for the majority of demand, although the use of these is concentrated in mature markets, and many developing markets make greater use of block pallets.
Pallet demand in this study is also segmented by market, according to Freedonia. In analyzing demand by market, the party who places goods on the pallet is considered to be the user of the pallet:
- For example, when a manufacturer of breakfast cereal purchases a pallet to ship boxes of the cereal, this is considered to be demand by a manufacturer in the food and beverage market.
- When a pallet management firm purchases a pallet, stores it, and then leases it to a manufacturer, this is considered to be demand by a warehousing services provider.
Markets covered in the report include:
- food and beverage
- transportation equipment
- other manufacturing industries (e.g., electronic products, metal products, machinery)
- third party warehousing and storage
- pallet management services
- other markets (e.g., military transportation and storage, retailers)
The Freedonia Group – The Freedonia Group, a division of MarketResearch.com, is a leading international industrial research company that publishes more than 100 studies annually. Since 1985 we have provided research to customers ranging in size from global conglomerates to one-person consulting firms. More than 90% of the industrial companies in the Fortune 500 use Freedonia Group research to help with their strategic planning. Each study includes product and market analyses and forecasts, in-depth discussions of important industry trends, and market share information. Studies can be purchased at www.freedoniagroup.com and are also available on www.marketresearch.com and www.profound.com.