📈Surging Production: The U.S. pallet industry produced 919 million new pallets in 2021, a 75% increase from 2016, reflecting a strong industry rebound.
📈Shift Toward Softwood: Softwood lumber use jumped to 81% of all pallet lumber, with species like Southern Pine and Douglas Fir gaining market share.
📈Repaired Pallet Market Shrinks: While demand for pallets surged, the number of repaired/remanufactured pallets dropped by 16.4% compared to 2016.
📈COVID-19’s Uneven Impact: 51% of companies exceeded their 2019 sales, while 22% reported no disruption, and 46% faced ongoing material shortages.
| Year | New Pallets | Repaired/ Remanufactured | Brokering/ Wholesaling | Crate Manufacturing | Other |
|---|---|---|---|---|---|
| 2011 | 58.9% | 25.1% | 1.3% | 6.7% | 14.7% |
| 2016 | 51.9% | 24.0% | 11.7% | 6.7% | 5.7% |
| 2021 | 55.4% | 27.0% | 3.7% | 3.8% | 10.1% |
Source: Hobbs, S., Horvath, L., & Gething, B. (2025). Investigation of the Status of the Wooden Pallet Market during the COVID-19 Pandemic. BioResources, 20(2), 3047-3074.
The Pandemic Pallet Boom: How an Industry Weathered the Storm
The COVID-19 pandemic upended global supply chains, forcing businesses to rethink how they move goods. The wooden pallet industry—critical to logistics and manufacturing—faced raw material shortages, skyrocketing demand, and major shifts in production trends.
A new study published in BioResources, led by researchers from Virginia Tech and the National Wooden Pallet & Container Association (NWPCA), provides the most comprehensive look yet at how the industry adapted between 2019 and 2021. The findings reveal a sector that not only survived but thrived, fueled by e-commerce expansion, supply chain constraints, and automation investments.
New Pallet Production Hits Record Highs
The U.S. wooden pallet industry saw unprecedented growth during the pandemic. New pallet production surged to 919 million units in 2021, a 75% jump from 2016. Including repaired and remanufactured pallets, the total output reached 1.18 billion pallets—solidifying the industry’s essential role in supply chain stability.
The standard 48” x 40” pallet remained dominant, accounting for 29% of new pallet production, though its market share dipped slightly from 35% in 2016. Meanwhile, 40” x 48” pallets, commonly used by the Department of Defense (DoD), saw demand double during the pandemic as military supply chains ramped up distribution of medical supplies and essential goods.
A key finding: larger pallet companies expanded aggressively during this period, investing in automation to boost output per employee and mitigate labor shortages.
| Year | 48×40 | 40×48 | 48×48 | 48×45 | 48×42 | 48×36 | 42×42 | 37×37 | 31.5×47.25 | Other |
|---|---|---|---|---|---|---|---|---|---|---|
| 2006 | 27% | 5% | 4% | 2% | 4% | 2% | 5% | 2% | 0% | 50% |
| 2011 | 24% | 3% | 4% | 0% | 0% | 2% | 5% | 2% | 1% | 60% |
| 2016 | 35% | 4% | 7% | 5% | 3% | 1% | 5% | <1% | 1% | 39% |
| 2021 | 29% | 8% | 7% | 3% | 4% | 2% | 6% | <1% | <1% | 40% |
Source: Hobbs, S., Horvath, L., & Gething, B. (2025). Investigation of the Status of the Wooden Pallet Market during the COVID-19 Pandemic. BioResources, 20(2), 3047-3074.
Softwood Takes Over: Major Shift in Lumber Use
Perhaps the most striking trend uncovered in the study is the industry’s accelerated shift from hardwood to softwood. By 2021, softwood lumber accounted for 81% of all pallet lumber—a dramatic increase from 55% in 2016.
Key drivers behind this shift include:
- Softwood is easier to source amid tightening hardwood supplies.
- Southern Pine and Douglas Fir availability increased, while Spruce-Pine-Fir (SPF) declined due to beetle infestations and wildfires.
- Softwood is lighter and easier to kiln-dry, meeting ISPM-15 export requirements.
The industry’s total lumber consumption nearly doubled, reaching 17.9 billion board feet in 2021, making pallets one of the largest consumers of U.S. sawn lumber.
Repaired Pallet Market Shrinks Despite Demand
While new pallet production soared, the number of repaired and remanufactured pallets declined by 16.4% from 2016 levels—a surprising trend given the industry’s long-standing emphasis on recycling and reuse. One major factor driving this decline was a shortage of pallet cores. Many companies, facing supply chain uncertainties, opted to hold onto their pallets for longer periods, reducing the supply of repairable units available in the market.
At the same time, automation and efficiency improvements were reshaping pallet production. Larger companies, in particular, increased their output per worker through automation, allowing them to meet demand without relying as heavily on increasingly scarce and expensive recycled pallets. This shift made new pallet production a more attractive option in some cases, further diminishing the need for repaired units.
Despite these challenges, the market for repaired pallets remained significant, with 280 million units produced in 2021. Pallet recyclers benefited from higher resale prices, as demand for used pallets surged amid supply shortages.
Pandemic Pressures: Mixed Business Impact
The survey results revealed stark contrasts in how pallet companies fared during the pandemic. While some businesses thrived, others struggled to navigate supply chain disruptions and labor shortages.
For more than half of pallet manufacturers, the pandemic-driven demand surge was a boon. Fifty-one percent of businesses exceeded their 2019 sales, as e-commerce expansion and shifting supply chain priorities drove an increased need for pallets. Some companies were able to capitalize on the situation by investing in automation, which allowed them to maintain high output even as labor shortages persisted. By streamlining production processes, these businesses not only met surging demand but also positioned themselves for long-term efficiency gains.
However, not all companies had the same experience. Forty-six percent of respondents reported facing raw material shortages that persisted throughout the pandemic, making it difficult to keep up with orders. Some businesses were hit even harder—7% shut down permanently, while 16% were forced to temporarily lay off workers as they struggled to adapt.
Despite these disruptions, a notable 22% of respondents reported no significant impact on their operations. This suggests that established, well-diversified pallet manufacturers were better equipped to weather the crisis compared to smaller firms that lacked the resources to adapt quickly.
The Road Ahead: What This Means for the Industry
The wooden pallet industry emerged from the pandemic stronger than ever, with key shifts that will shape its future:
- Lumber trends: The move toward softwood dominance is likely to continue, with Southern Pine leading the charge.
- Automation acceleration: Companies that invested in automated pallet production and repair gained an edge, a trend expected to persist.
- Supply chain adaptation: The industry’s ability to ramp up production proved critical in keeping global supply chains moving. Future crises may see even greater reliance on reusable pallets as sustainability pressures grow.
- Resilient demand: Despite the shift to high-volume new pallet production, repaired and remanufactured pallets remain a key part of the industry, particularly as cost and sustainability concerns rise.
With over 3.1 billion pallets in circulation in the U.S., the industry’s ability to adapt will remain essential to supply chain efficiency, as reflected in ongoing investment in automation, sustainable materials, and innovative designs.
Sources
- Hobbs, S., Horvath, L., & Gething, B. (2025). Investigation of the Status of the Wooden Pallet Market during the COVID-19 Pandemic. BioResources, 20(2), 3047-3074.
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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.
