With lumber prices climbing, Chicago is sitting at a crossroads between
crime and commerce
Wood pallets are good as gold to some crooks
By John Keilman
Tribune staff reporter
Published April 30, 2007
The theft, police say, was an inside job: Two employees of a St. Charles
food service company waited until the coast was clear, then helped a
confederate make off with a truckload of hot merchandise.
The men weren't after fur coats or flat-panel TVs, but something that not
long ago was little more than landfill chum -- a mess of wooden shipping
Experts say the spiraling price of lumber has made pallets valuable enough
to steal, a sharp contrast to just a few years ago when companies let them
pile up in factory yards. By some estimates, nowhere in the country sees
more of these timber thefts than the distribution hub that is greater
"I would imagine it's more frequent and unreported than it should be," said
investigator Patrick Staples of the Northern Illinois Auto Theft Task Force,
which last year arrested a man for swiping a trailer full of pallets worth
about $2,300. "But if guys do this twice a month, they're making a good
living and not getting caught."
A decade ago, companies traditionally threw away their worn-out pallets: One
study found that more than 4 million tons went into landfills in 1995,
making up 1.4 percent of the waste stream.
But Bruce Scholnick, president of the National Wooden Pallet and Container
Association, said the cost of wood went up as sawmills became more
efficient. They were able to use more of each log for furniture or building
material, leaving fewer lower-grade scraps that are turned into skids. That
caused the price of wooden pallets to rise to about $5 apiece -- and
criminals took notice.
For decades, wooden pallets have been the favored platform for transporting
everything from bananas to bongo drums, their double-deck shape built to
accommodate forklifts. With 2 billion in circulation, they account for the
largest single use of U.S. hardwood lumber, according to the pallet
Brian Cosentino, president of Skid Recycling in Naperville, said that during
a three-year period his business lost 100 trailers full of pallets. Thieves
slipped into his lot, hitched the trailers to their own trucks and drove
away. Chicago police later found the trailers empty and abandoned, their
contents presumably sold to unscrupulous pallet dealers, Cosentino said. As
a crowning insult, he had to pay a towing company about $1,000 to get a
"[The thieves] are pretty clever," he said. "They know what they're doing.
If a plant closes at 5:30 in the afternoon, they'll show up at 6 p.m. and
grab the pallets."
Tim Hagan, manager of Commercial Pallet on Chicago's West Side, has found
that enterprising thieves don't let the lack of a semitrailer truck prevent
them from stealing. He said he has caught people sneaking onto his property
and heaving 50-pound skids over the fence.
"If they'd work that hard during the day, I'd hire them," he said.
The trade magazine Pallet Enterprise has called Chicago, with its
constellation of warehouses and factories, the nation's hotbed for this
thievery. But with black-market prices ranging from $1 to $4 per skid,
crooks have been at work from coast to coast, and it's not just wood they
Each year, the U.S. Postal Service buys 2 million pallets made of plastic --
a material chosen for durability and compliance with international sanitary
regulations -- at a cost of about $22.75 apiece. An indeterminate number of
those replace pilfered skids, said postal inspector Amanda McMurrey.
The Postal Service gives pallets to bulk mailers to make deliveries more
efficient, but some exploit the service. In February an employee of a mail
house near Atlanta was arrested after he allegedly ordered nearly 10,000
excess pallets, then sold them to another company for $1 apiece.
"Wherever there's money to be made, there will be someone there to take
advantage of it," McMurrey said.
There has been talk in the industry of attaching radio tags to skids, making
them easier to track and identify, but for now pallet dealers are relying
mostly on low-tech solutions. Some have attached heavy-duty chains to their
gates, and others have installed special locks on their trailers, making
them harder to hitch to rogue trucks.
St. Charles police say old-fashioned surveillance led to the arrests last
month of three men who allegedly tried to steal 160 pallets from Compact
Industries, a food services business.
After losing hundreds of skids in earlier thefts, company managers kept an
eye on the loading dock and called authorities when they saw two employees
loading pallets into an accomplice's semi, police said. Police stopped the
truck as it left the company, and three people were charged with felony
The Northern Illinois Auto Theft Task Force, based in Rockford, snooped a
little harder to make its bust. When someone made off with a trailer
belonging to Northwest Pallet Supply Co. in Belvidere last year, the task
force followed a GPS trail to a row of cargo distributors near O'Hare
Staples, the investigator, figured out that the thief had used a phony
invoice to sell the pallets to one of the cargo companies. The man, who was
soon identified though security camera footage and a photo lineup, was
convicted of felony theft. He is serving 4 years in prison.
The rash of thefts partly explains why Cosentino, of Skid Recycling,
recently got out of the business, becoming a pallet broker instead. But some
say the rip-offs have a positive side.
"You don't see [pallets] lying around anywhere," said Brooke Beal of the
Solid Waste Agency of Northern Cook County. "I live in the city, and you see
people push them down the street in shopping carts. Five, six, seven, 10
years ago, you would see them in the garbage."
As the pallet association's Scholnick noted, the thefts are a reminder of
the ravenous demand for his industry's product.
"When a pallet suddenly has that much value, it's good," he said.