Nelson Company Blog
  • Home
  • Plastic Pallets
  • FDA
  • Wood Pallets
  • Crates & Containers
  • Sustainability
  • ISPM-15
  • Tech Center
  • News

Why are plastic pallet prices skyrocketing in 2021?

4/19/2021

0 Comments

 
If you’ve been trying to source plastic pallets in 2021, you already know it ain’t pretty. The reality right now is that prices are on a steep trajectory. And, it may be some time yet before we see any relief.

What gives? If you’re pointing the finger at COVID-19 (and who isn't), you’re part way there. Let's take a look at more factors contributing to this chaotic ride.
plastic resin price increasing
Market prices for polymer resin used in manufacturing plastic pallets continue to increase due to strains within the global supply chain.
Plastic Supply Chain Disruptors

We've never seen a plastic market like this before. The raw materials required to make plastic pallets including polypropylene (PP) and polyethylene (PE) are in short supply. The market is so tight right now that factories are starting to slow production or completely shut down if their product relies on plastic.

Here are the top culprits for rising prices:
  
  1. The Pandemic
    When the world went into lockdown, production stopped in nearly every industry and supplies dwindled. Getting factory lines up and running again proved to be costly and difficult to navigate in a post-covid world. Beyond staffing and PPE shortages, freight issues added to the headache. The transportation industry is still facing its own crisis and increased costs for moving goods from place to place in wake of the virus.

  2. Two Gulf Coast Storms
    Most recently, Texas was hit by an icy winter storm and power outages that brought portions of the state to a grinding halt. Guess where much of the raw materials for plastic comes from. Bingo... the state's gulf coast petrochemical facilities. Six months prior, Hurricane Laura shut down petrochemical production in both Texas and Louisiana. Double whammy. Ouch.
      
  3. Consumer Demand
    Plastic is everywhere. Think about it. The car you drive. The phone in your hand. That bottle of pop chilling in your fridge. And, of course, the plastic pallets and crates that deliver parts and finished products. Manufacturers that normally don't compete against each other are suddenly impacted by the same raw material shortage. Some even hit pause on production to give way to the more critical manufacturing of medical and sanitation products. Things like masks, gowns, hand sanitizer, cleaning products and more all rely on the plastic supply.
      
  4. The Suez Canal Fiasco
    Yep, that backlog of 400+ stranded ships in one of the world's busiest waterways is another factor. A few short weeks ago, a single ship ran aground in the canal and upended supply chains. The result is delayed shipments and longer lead times including petroleum products and petrochemicals. While Europe may be more impacted by this event, a ripple effect is already finding its way to the US. 

So now what?

Talk with your pallet supplier to develop a plan. Prepare for possible delays and future increases in price. If your system has room for flexibility, alternative pallet types or sizes may help bridge the gap until we see the market return to normal.

What impacts are you feeling the most in this plastic pallet market? Tell us in the comments below.

Post by: Mike Cunneen, Director of Sales & Marketing
0 Comments



Leave a Reply.

    Call Us: (410) 477-3000
    Nelson Company logo
    Headquartered in Baltimore since 1918 Nelson Company is a trusted source for pallets & packaging materials.
    NelsonCompany.com
    Nelson Technical Center
    Is your packaging system costing more than it should? Find out how you can start saving with an analysis from Nelson Technical Center.
    Nelson-Art Asset Retrieval Technology
    Our own web-based software for reverse distribution. Nelson-ART™ manages the entire life-cycle of your packaging assets.

     
    ​Categories

    All
    Crates And Containers
    FDA
    Industrial Packaging
    ISPM-15
    Pallet Mold
    Plastic Pallets
    Shipping And Freight
    Sustainable Packaging
    Technical Center
    Total Packaging Management
    Transport Packaging Industry News And Events
    Wood Pallets

      
    ​Our Authors

    David Caltrider
    Rich Reiher
    Mike Cunneen
    John Clarke
    Hartson Poland
    Jonathan Haynes
    Paul Pascarella
    Kaitlin Manning
    Chris Recker
    Aaron Pascarella
    ​
    Tyler Pease

     
    ​Archives

    March 2023
    January 2023
    December 2022
    November 2022
    August 2022
    July 2022
    May 2022
    March 2022
    January 2022
    December 2021
    November 2021
    September 2021
    August 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    November 2020
    August 2020
    May 2020
    April 2020
    February 2020
    December 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    March 2016
    February 2016
    January 2016
    November 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014
    September 2014
    August 2014
    July 2014
    June 2014
    May 2014
    April 2014
    March 2014
    February 2014
    January 2014
    December 2013
    November 2013
    October 2013
    September 2013
    August 2013
    July 2013
    June 2013
    May 2013
    April 2013
    March 2013
    February 2013
    January 2013

    RSS Feed

Tech Center

The Nelson Technical Center finds savings. Solutions for the design, supply and recovery of transport packaging.
(443) 649-1049

Wood Sales

Custom wooden pallets and crates are our specialty. Ask us about wood manufacturing, repair and recycling.
(410) 477-3000

Plastic Sales

Let our experts match you with the best plastic pallets or containers. Available in new and gently used condition.
(443) 649-5294
The Nelson Company Logo
The Nelson Company
4517 North Point Blvd
Baltimore, MD 21219
(410) 477-3000
© COPYRIGHT 2013-2021. ALL RIGHTS RESERVED.
  • Home
  • Plastic Pallets
  • FDA
  • Wood Pallets
  • Crates & Containers
  • Sustainability
  • ISPM-15
  • Tech Center
  • News