Economic uncertainty has clouded the pallet market outlook, as July’s job report revealed weaker-than-expected job growth. The elimination of the de minimis tariff exemption for low-value shipments is expected to improve pallet demand. Anticipated interest rate cuts will have a knock-on effect on housing affordability, stimulating the construction sector which in turn impacts lumber prices. …As pallet usage has grown, softwood has become the dominant material used in pallet manufacturing due to its abundance and cost-effectiveness. Hardwood mills were hit hard, and many saw closures, after the Chinese property market collapsed as that was its biggest end-use market. This Canadian softwood lumber supply shock does certainly leave the door open for the hardwood pallet to regain some market share. Supply and demand indicators are pointing to higher prices towards the end of 2025 and into 2026.