Wood packaging and pallet companies are set to raise prices again this year to combat a number of factors, including a shortage of suitable timber, the Timber Packaging and Pallet Confederation (TIMCON) has warned.
TIMCON said the pressures had created a growing shortage of pallets on the UK market and advised its members to focus on forward planning to achieve continuity of supply and price stability.
It said the Baltic supply chain remained difficult, with companies looking for new timber suppliers. Some were using long length material from the UK, South Amercia and Sweden, and are considering investment in further re-processing facilities to ensure control and continuity of supply.
Baltic timber prices have risen by about 10% during the fourth quarter and manufacturers predict a further 5-6% hike in the new year. TIMCON said the increases were being caused by other sectors and countries, such as the expansion of the Baltics pulp industry, which is consuming large quantities of softwood.
Other factors include soaring freight rates, systematic grading of logs, higher fuel charges, falling consumer demand and consolidation of the Baltic logging industry.
TIMCON said panel prices were also expected to increase further in 2005 due to the rising costs of resins, energy an strong global demand.
A Timcon spokesperson said: “TIMCON urges its members not to guarantee prices for longer than three months and to ensure their contracts make clear that the price being quoted is subject to the supply of raw materials.”
