Future Market Insights (FMI), in its latest publication, outlines the future trajectory of molded wood pallets market for the period, 2019-2029. According to the study, global sales of molded wood pallets reached 435 million units in 2018, and are estimated to record a Y-o-Y growth of approximately 3% in 2019. Molded wood pallet manufacturers’ capabilities have been put to test in recent times, as notable trends such as pallet pooling continue to flourish among end-users.
As wood waste takes up a considerable amount of landfill space, manufacturing molded wood pallets became an effective solution to waste utilization and a perfect fit for companies going green. In addition to weighing 35% lighter, molded wood pallets are nestable which helps optimize space and reduce the cost of retrieval by more than half when compared to conventional pallets.
Molded wood pallets are sanitized during the molding process and meet the most stringent phytosanitary regulations such as ISPM-15 for export. As food and pharmaceutical companies are diligent about using pallets free of contaminants, FMI study finds that capitalizing on these companies will work to the advantage of molded wood pallets manufacturers.
Fulfilling End Users’ Quest for Sustainable Practices
The study finds that the molded wood pallets market is anticipated to grow at a volume CAGR of approximately 3% through 2029. One of the key growth drivers is manufacturers’ efforts to use significant amount of wood waste as raw materials that would otherwise end up in landfills. Further, adoption of environmentally responsible manufacturing process that consumes less energy, helps take a step closer towards sustainability goals for many industries. However, molded wood pallets are designed for limited reuse and are not reparable. Manufacturers are thus paying attention on potential methods to assist in avoiding landfills when the products have exceeded their useful life.
Although full-sized molded wood pallets continue to witness robust sales with approximately 60% revenue share in the market, manufacturers are working on increasing the production of half-sized pallets that enhance efficiency and reduce costs for shippers of smaller loads. The study opines that small-scale companies will benefit from half-sized pallets, as the use of recycled full-sized pallets burdens them with more pallet space and weight than necessary. Moreover, half-sized, nestable molded wood pallets are likely to account for relatively large share of the market players’ bottom lines in the future.
According to the study, opportunities abound for market stakeholders in logistic & transportation sector, on account of increasing industrial activities along with rapid proliferation of trade agreements among various countries. Recognizing the recent developments in manufacturing and construction industries, manufacturers are likely to explore newer opportunities, with ‘sustainability’ at the forefront of attracting attention. Aligning with evolving end users’ trends and upgrades in regulatory norms also remains an important focus area of the manufacturers.
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Growth prospects of the molded wood pallets market, as identified by the FMI’s study, are high in EU5. Higher concentration of players in the region and their efforts to push sales and distribution through online channels are emerging as a strategic move. Further, Asia Pacific, particularly eastern region, is expected to represent higher incremental opportunities, backed by hefty investments in industrial sectors in recent years, which has primarily influenced the adoption of pallets.
The FMI report further offers a comprehensive analysis of competitive landscape in molded wood pallets market. Although the market shows a high level of consolidation with a handful of key players accounting for prominent shares, there are less number of manufacturers as compared to the conventional pallets providers. Sensing a wide window of opportunity for new entrants, key players are inclining towards diversifying their product portfolio and leveraging opportunities in the untapped markets.
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