The phone call from Lithuania is unexpected, times and prices had actually already been agreed. And yet, those 5 trucks loaded with wood, this is the meaning of the call, they will only start paying 20% more. «And what does he want me to do – explains Ezio Daniele, president of Assoimballaggi – in this situation one accepts and swallows the toad, there is no alternative ».
The double problem of pallets
Daniele is an entrepreneur in the pallet sector and like all his colleagues he is struggling with a double problem, linked to the costs and availability of the raw material to compose the pallets: wood. “Depending on the type – explains the president of Assoimballaggi – in less than a year the values have doubled or even tripled and this reverberates on downstream prices”. The impact of the material on the final price is in the order of 70-80% and Daniele himself, who resells a particular type of pallet, suffers the impact. “In September it cost me less than 9 euros – he explains -, this morning it was quoted at almost 18. But the crux is also that of scarcity, wood just can’t be found: I would not rule out that some companies in the summer can run out of packaging” . Problem exacerbated by the strength of demand, a step forward that involves all sectors and that is “read” in a linear way by the producers of pallets, the basic brick of every logistic process, a transversal element that enters all production chains.
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The record increases
Pushing the category to new records both in terms of revenues (but here the effect of the cost of raw materials is relevant) and volumes, also in progress compared to the pre-Covid period. «We are something beyond the levels of 2019 – explains Emanuele Barigazzi, entrepreneur in the company of the same name in Parma – and at the moment we are struggling to serve our historical customers. If we can, we try to avoid additional orders, which we would manage with difficulty. The increases? In some way the customers are absorbing them, even if such a frenetic moment had never been seen before: if a year ago we paid 140 euros per cubic meter for our wood, today we have even reached over 400 ». From food to mechanics, from machinery to tiles, demand is in this explosive phase, contributing to aggravating supply difficulties.
Continuous price updates
“We are in a dramatic situation – explains Livia Ghirardi, entrepreneur in the Mantuan company Monari Pallets – which forces us to change operating modes. Since this month, for example, price updates with customers are made every 15 days, which had never happened before. After all, when a wood supplier today presents us with an offer, it is worth a few hours, it is a sort of “take it or leave it”. We are buying at full speed, trying to stock up but we don’t know if all this will be enough ».
Those who can put the internal sawmills to work, widening the range of material that can be purchased but the impact on total costs is still reduced. “In my company we have orders for the whole of 2021 – explains the president of Conlegno Orlando Fravega – and in theory we could do even more, were it not for the scarcity of material. Volumes are growing but in terms of margins for the sector it will be a difficult year: as far as prices are concerned, although the update is now more frequent, we are always chasing a raw material value that seems out of control ».
The scarcity of nails too
If wood is certainly the key problem, it is not the only one for the sector. The shortage concerns, for example, nails, a component that is now being sought in countries never probed in the past for this supply, such as Turkey or Lithuania. As a result, in less than a year the prices of the pallets have literally exploded, with increases from 50 to 100% depending on the type (the standard pallet, Apple, has gone from 8-9 to 15-16 euros per piece) and the feeling that the race is not over yet. «The US and China are hoarding up material – commented Massimiliano, the president of the Assoimballaggi pallet group Bedogna – and we believe that the time has come for Europe to protect the raw material, limiting or blocking the export of logs. We ask the Government to give us guarantees, because the pallet is an essential asset for the economy ».