Ian Carter is president of Crane Point Industrial LLC. His company is an importer and national distributor of fasteners for the pallet industry and other industries. Crane Point also imports and distributes hardware, screws, wrap, and other industrial products. In addition, Crane Point is a distributor of leading and minor brands of pneumatic nailing tools and provides tool repair services.
PALLET ENTERPRISE: Why is the current nail shortage different from some other supply problems in the past? What are the primary drivers of this crisis as you see it?
Carter: It’s in a crisis mode. You have three things going on at the same time. The big one is you have a massive uptick in (pallet) production with the United States. We’re seeing customers that are experiencing a 15-30% increase in production. Number two, ALL of the domestic nail suppliers have not been able to keep enough employees, and their production is down. Third, the shipping frequency of containers out of Asian countries and other countries where pallet nails are made is off the charts – down dramatically.
Historically, we have seen transit times from shipping to arrival at 35-40 days. Now we’re watching transit times pushing 90 days. And U.S. ports are so jammed, it takes four weeks to get through the port.
Imports into the country have increased 40-60% because people have money to buy things. There are not enough containers at the point of origin to load product. There is a massive amount of product sitting waiting to load into a container. The factories overseas that make nails have no place to put finished goods, so they have to curtail production.
On top of everything else, wire rod prices have doubled in the past 18 months.
PALLET ENTERPRISE: What should smart pallet companies do to secure supply?
Carter: I don’t even know how to answer that one. Of all the pallet manufacturers I know, I only know one – maybe two – that is ahead on supply. Other than that, a lot of people got caught completely off guard. The only thing a smart pallet company can do is cozy up to their supplier and keep in constant communication. Be careful of vendors who are not normally in the market – quality could be an issue, especially with MQBulk.
PALLET ENTERPRISE: What has Crane Point Industrial done to help keep its customers supplied with nails?
Carter: We saw this coming back in March. We saw the shipping problem really going into overdrive and deteriorating initially out of South Korea. Because of our relationships with nail manufacturers overseas, we took an extraordinary stance. A factory that we work with outside of Asia stepped up with extra capacity through the end of the year, and we ordered a significant number of containers – well beyond what we normally forecasted – in order to make sure there is a steady supply coming through. We are committed to buying more product through the end of the year. I did this out of fear the market was going to go into turmoil and there would be a complete meltdown starting in August. We have product coming in, although I still don’t know if the extra containers are going to fill the gap caused by slow production elsewhere and slow shipping.
