Wooden Pallets and the Canadian Forestry Industry

February 17, 2015
Canadian lumber market

Every commodity has its ups and downs, and right now, lumber is up. Canadian forestry companies are riding a strong start to the year, as demand for lumber in Canada, the US, and especially in China resulted in a forestry export market that increased by ten percent in 2014. Spruce, pine, fir, and other woods — they're all commanding a high price, and the long term outlook for this sector suggests prices will only keep climbing. Consumers who are looking to purchase wood products such as wooden pallets and crates will want to pay attention to the price of this valuable commodity, as its fluctuation and forecasted rise will certainly affect their bottom line.

A Booming Lumber Market

As things things usually go, the upward trend of the price of lumber is largely a matter of supply and demand. In the US, a rebounding economy and a stronger dollar has led to an increase in housing starts; lumber is needed to build those houses. On the supply side, some of the more prominent Canadian forestry companies are unable to keep pace with the demand for lumber. This is due to a number of factors, including recent infestations of mountain pine beetles, conservation reasons, and others.

There are additional factors too, like the lower value of the Canadian dollar against the US dollar and other international currencies. Buyers from outside of Canada know that now is a good time to buy Canadian materials (as opposed to domestic materials) because the exchange rate is greatly in their favor. Finally, the Canadian National railway has had a hand in boosting lumber prices.
First, buyer confidence has been boosted thanks to the upgrades made to the railway in the past year or two, making the transport of lumber (as well as other raw materials) via rail is safer, more reliable, and more efficient. Second, to make these upgrades, CN purchased a large quantity of Canadian lumber, bringing demand up and the price along with it.

What This Means If You’re Looking To Buy Pallets

If you’ve been thinking about investing in a fleet of wooden pallets for your business, now is the time to buy! Here’s why: prices may be high, but according to a recent article published in The Vancouver Sun, the International Wood Markets Group projects that lumber prices will be at all-time highs by 2017. Waiting any longer to buy pallets, then, could end up costing you and your company more.

When you’re ready to talk about buying pallets, give Herwood a call. As one of North America’s top manufacturers of wooden pallets, we can assess your company’s needs and sell you a fleet that will meet them. Whether you’re interested in heat treated pallets, wooden crates, or another lumber-based product for international shipping, HWP Herwood is here to help. Get in touch with us today at 1-800-884-4907.

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