United Fresh Produce Association Details Pallet Shortage Affecting North American Produce Industry
WASHINGTON, DC - Although it has been on the industry radar for a short time now, today, United Fresh Produce Association released a letter to its members detailing the pallet shortage challenge facing the North American fresh produce industry. While the shortage is relatively acute, the hurdle could potentially impact the availability of produce to consumers.
“The lack of pallets is adding stress to a supply chain that is already facing significant challenges, which include a lack of available trucks and shipping containers, ongoing labor challenges, fluctuating fuel costs, pandemic-related challenges, and a pending shortage of resin used to make reusable containers and pallets,” the release stated. “At this time, expectations are that the pallet shortage will continue for months, perhaps for the balance of 2021—all at a time when many North American produce items are just beginning seasonal harvests and shipments.”
To provide information about the scope of the challenge, United Fresh included some of the effects and details of the shortage and the potential issues that could arise:
- Efforts of wholesalers, distributors, and retailers to ensure sufficient inventory of non-perishables given previous pandemic-related impacts
- The availability of lumber to repair and build new pallets
- The escalating price of lumber when it is available
- Non-perishable inventory dwell time increase
- Lack of available trucks to relocate pallets
So far, according to the release, the shortage of lumber and wood products has increased the cost of raw lumber by 200–350 percent, making the cost of wood pallets increase incrementally. Due to the shortage, some companies have been forced to bring pallets from other jurisdictions, thereby incurring border and transportation costs. Additionally, pallets are being held in-house due to delayed and cancelled orders from pallet services, leading to higher storage charges and increased congestion within operations.
To overcome this challenge, United Fresh urges the supply chain to work together to balance organization goals to ensure pallet availability for shipments of produce. The association is urging grower and shippers to work together to remain compliant with pallet requirement specification when possible, and consider temporary modifications or exceptions to pallet requirements, as long as they do not jeopardize safety, until the shortage is resolved.
Until this hurdle is cleared, United Fresh encourages all suppliers to have regular discussions with their pallet providers to understand how they are being affected by this shortage.
As more updates become available, AndNowUKnow will continue to report.