Santa Claus driving a forklift

Four Essential Tips to Manage Pallets During this Holiday Season

Santa and his helpers always practice safe pallet handling

It is definitely not the season to be jolly if your supply chain grinds to a halt for lack of pallets. If the order picking crews are scrambling to find pallets to build orders, then shipments can quickly get delayed and complicate the delivery schedule. Here are four essential tips for making sure that customers are happy and workers stay safe throughout the holiday season.

Plan ahead for the need

Based on previous experience and projections, make sure to have the pallets on hand needed to fulfill orders. This year (2020) presents a unique challenge in projecting demand, so it makes sense to be nimble in terms of finetuning pallet requirements. Clear communication and an ongoing dialogue with your pallet suppliers are critical.

A best practice tip is to have the supplier hold an inventory of ready-to-ship pallets, so they will available when you need them. Do not be left in a position where you run out of pallets and must start cold calling pallet vendors for an emergency delivery.

Train the seasonal workers

Peak season volumes and seasonal employee support go hand and hand. By taking the time to train new team members in safe manual pallet handling and the efficient forklift handling of pallets, you can reduce the risk of injury and damage to products and pallets alike.

Remember other seasonal team members who make pallet-related decisions, such as new delivery drivers and temps hired to sort pallets. Do they have the necessary knowledge to ensure that damaged pallets are consistently removed from use and that drivers fulfill their responsibility regarding empty pallet return or other duties related to pallet management?

Don’t neglect to bring pallets back

When logistics systems reach peak and delivery driver capacity is stretched to the limit, one shortcut that companies take is to delay bringing back distribution residuals such as cardboard, reusable trays, and, of course, empty pallets. With trucks focused on keeping up with outbound shipments, retail locations are faced with stockpiling pallet accumulations either in the back room or in the parking lot.

Unwanted buildups of pallets can impede store operations and result in those pallets not being returned to the warehouse, where they might be urgently needed. Also, consider that the unprotected outdoor storage of pallets and reusable packaging at retail dramatically increases the risk of pallet theft.

Consider outsourcing to your pallet provider

It can be a scenario of all hands on deck for retail distribution during the holiday season. With labor urgently needed for filling and delivering orders, roles such as pallet sorting are often viewed as secondary. Unsorted stacks of pallets can back up in warehouse corners or fill up trailers desperately needed for outbound shipments.

The other alternative, the introduction of unsorted pallets into your system, can result in other inefficiencies. And as mentioned above, driver and road equipment limitations can impede your reverse logistics process.

Retailers can avoid this seasonal strain by working with their pallet company partners to provide pickup of pallets and other distribution residuals. The result is pallet and residual processing capacity that does not strain your labor availability and provides ‘ready to go’ pallets as needed for the distribution center.

When it comes to the holiday season and pallets, it can be a time of extremes – too few for order picking or too many to return and sort. Attention to planning, training, and pallet supplier coordination can make a big difference.

How Forklift Drivers can Reduce Wood Pallet Damage

wood pallet scraps

Call it synergy – the combined result is exponentially more potent than the sum of the individual components involved. That’s the way it is for pallets and forklifts. The development of pallets and unit load handling dramatically has improved material handling. The mutually beneficial relationship between lift trucks and wood pallets spans over 80 years and continues to evolve.

Today, palletized handling is a fact of life in many supply chains. Logistics professionals, however, continue to strive for continuous improvement opportunities. As they explore ideas for reducing product and pallet damage, an opportune place to start is the interface between the forklift and the product – the wood pallet.

Why is reducing wood pallet damage important?

There are crucial reasons for eliminating pallet damage. Let’s start with safety. Exposed nails and splinters can cut or puncture the skin. More seriously damaged pallets can result in toppled loads or load failure – events with potentially catastrophic outcomes. Broken pallets can damage palletized goods, and the impacts that damage the pallets can also damage the products they carry. 

Pallet damage can also put a damper on supply chain flow. This factor has become critically important as operators find themselves pressed to process orders faster than ever before. Pallet damage can unexpectedly disrupt that flow and cause unplanned delays.

For example, warehouse staff must re-board, or double-board unit loads palletized on damaged pallets before inducting them into the warehouse or production plant. Damaged pallets can get caught up in material handling systems such as conveyors and pallet racking, requiring intervention and causing expensive downtime.

How forklift operators can reduce wood pallet damage.

Slow down upon pallet entry

It may seem counterintuitive to slow down when speed is required, but slowing down immediately before entering the pallet will reduce impact damage to pallet lead boards and product alike, eliminating the need to deal with these issues subsequently.

Place forks accurately

Incorrect fork placement can result in fork tips damaging the ends of pallet stringers or blocks. Take care to enter the pallet cleanly. Remove obstacles that make a level fork entry into the pallet difficult, such as floor debris.

Keep forks level

Ensure that forks are horizontal when lifting palletized products. If forks are angled, stress on the pallet’s top deck boards will not be uniformly distributed, increasing the likelihood of broken boards.

Avoid “shortforking”

Shortforking is an industry term for not completely entering the pallet with the forks. As in the case above, shortforking results in uneven distribution of weight. With all of it being shouldered by the pallet’s front half, the chance of pallet damage is increased.

Avoid bottom deck damage with correct pallet jack placement

Where forks are longer, such as in the case of a double pallet jack, markings on the forks can help. The operator can use the markings to quickly determine that forks are correctly positioned. This technique eliminates the risk of load wheels resting over bottom deck boards and damaging them when raising the forks.

Don’t hump pallets

One common cause of lead board damage results from operators making contact with an adjoining unit load in a row before completely lowering. The best practice is to lower the pallet immediately prior to placing it next to another unit load. When one pallet rides on top of the adjoining pallet lead board while being lowered, it can damage the lead board.

Take a look at your warehouse floor. Suppose you see many longer splinters on the floor. In that case, the chances are that forklift operators are lowering pallets after contact rather than prior.

Don’t bulldoze pallets across the warehouse floor

Pushing or bulldozing stacks of pallets or unit loads with a forklift is still commonly practiced. It is seen as a time-saving technique – moving several unit loads rather than one. This approach can cause damage to forklift and pallet deck boards alike, however. As one article notes:

Pushing an object (by forklift) subjects the drive train to higher loads than it’s designed for. Additionally, the inertia used to push can apply higher peak forces than it is supposed to handle. All of this can significantly reduce the life of the transmission.

Bulldozing pallets also presents safety risks. If an operator’s line of sight is blocked by the unit loads being pushed, they may not see other workers or equipment. Additionally, if a bulldozed load catches on a seem in the floor, it can topple and cause injury and damage.

Attention to forklift operation best practices can help your company minimize pallet damage, as well as damage to products and other equipment. Better forklift practices can reduce your pallet repair and replacement costs, and most importantly, better protect people who work in proximity to pallets. Now is the time to incorporate pallet handling best practices into your forklift training program.

Workplace Safety and Wood Pallet Handling

Companies recognize the importance of wood pallets and the imperative for working safely around them. With 80% of U.S. commerce transported under pallets, their role is crucial in warehouse and supply chain operations. While each workplace will have a unique risk profile that will ultimately inform its approach to working safely with pallets, it is essential to consider worker interactions with pallets in health & safety programs. In this post, we look at safe work practices regarding the handling of wood pallets and working in their proximity.

Pallet safety in operational health and safety programs

The Ontario Province Workplace Safety & Prevention Services (WSPS) recommends that companies incorporate a pallet safety program, including pallet inspection, removing damaged pallets from use, and properly handling and storing pallets. Consider the best practices listed below when incorporating pallet safety into your organization’s health & safety approach:

  • Train supervisors and workers on all safe practices and procedures – Workers who handle pallets and work around them are exposed to strains and sprains, cuts and abrasions, as well as other risks. Employees can minimize risk by exercising best practices, introduced through training, and reinforced daily by effective supervision.
  • Use appropriate personal protective equipment (PPE) – Glove and safety shoe usage are often a requirement for personnel who handle wood pallets. Gloves protect against cuts and puncture wounds, while safety shoes guard against the impact of a dropped pallet or stepping on a protruding nail from a broken pallet.
  • Implement a process to identify and remove damaged pallets from service, and restock loads on undamaged pallets – WSPS stresses the importance of establishing a routine of inspecting pallets and removing damaged ones from service for return to your pallet provider. Without a formal process for removing damaged pallets, they can easily get mixed up and find their way back into service. The use of broken pallets can increase injury risk to workers.
  • Eliminate trip & fall hazards: pallets in pedestrian walkways and pallet debris – Avoid setting pallets in pedestrian walkways, even temporarily, where they can result in trip & fall hazards. Also, clear wood pallet debris from the floor as frequently as needed to minimize the risk of twisted ankles or falls. In the warehouse, dock locations and order picker start and staging points often generate the most debris.
  • Eliminate trip & fall hazards: walking on top of pallets and between them – You can lose balance and fall when walking on the top deck of wood pallets and between closely placed pallets. Engineering your process to eliminate the need to walk on pallets or between them can pay dividends. A straightforward way to eliminate the need to step onto a pallet deck to reach a box at the far end of it is through using a picking hook to extend the warehouse worker’s reach.
  • Utilize a team lift approach to manually handling heavier, larger pallets – While mechanized solutions such as the forklift or pallet dispenser are generally preferred for lifting or positioning pallets, manual handling is a fact of life in many warehouses. Facilities may encourage a team lift of empty pallets by two employees, particularly for heavier or large pallets. When lifting a pallet solo, keeping it in proximity to the torso helps to maintain a close center of gravity.
  • Never use pallets as a lift platform – Only use approved, engineered lift platforms for elevating workers, and only after having received and signed off on necessary training. Pallets are engineered to support uniformly distributed loads, not people. A pallet should never be used as a man lift.
  • Never Stand Empty Pallets on End – While it might seem convenient, avoid resting empty pallets standing on end. Pallets standing on end are highly unstable. If they tip, they can cause lower-body injuries.

Ultimately, wood pallets are a crucial component in the safe and efficient function of warehouses and supply chains. Take time to understand the hazards and exercise best practices. Make wood pallet safety a part of your health & safety conversation.

The Peculiar Pricing of Wood Pallets

Photo by Frank Busch on Unsplash

In explaining why wood pallet prices vary, let us look at gas prices as a comparison. Consumers reluctantly accept the upward and downward shifts in prices paid at the gas pump. People understand that gas prices are largely dependent upon the price of crude oil, and so changes in the cost of crude are quickly reflected in the retail price of gasoline. Wood pallets are similar in that much of their cost is also related to another commodity – timber.

Consider that as much as 65% of the cost of a new pallet is directly related to the wood and fasteners used to build it. And given that pallet industry margins are generally very low, it is hard to avoid passing along cost increases. As such, pallet prices are extremely sensitive to the cost of material inputs. Other factors can influence wood pallet prices, including supply and demand, weather, government policies, and more.

Regional Variability for new wood pallets

National pallet buyers quickly come to understand that pallet prices vary across North America. Chances are that the price you pay for a new wooden 48×40 pallet will be different in Arkansas than in East Texas. Variables such as lumber, labor, and real estate availability all play a role.

A quick scan of a recent pallet market report revealed more than an 8% spread in pricing across the country for a new 48×40 wood pallet. Given that material costs are such an important component of wood pallet prices, it stands to reason that geographic regions enjoying access to cheaper wood will be able to produce pallets at a lower cost than in other areas. Regions with proximity to local timber supply can avoid significant transportation costs.

Regional variability for recycled pallets

As for recycled wood pallets of good usable quality (sometimes known, a recent market report showed that they varied almost 25% from the lowest pricing in New England to the highest in the Pacific Northwest. Unlike new pallets, however, the cost of new lumber is not a primary determinant of price.

The regional availability of recycled wood pallets and the demand for them, shape the market. In strong produce industry markets (read: fruits and vegetables), demand for recycled pallets may be very high. The supply of recycled pallets, however, is in large part generated from the consumption of consumer goods.

In larger metropolitan markets, more recycled pallets are generated. In markets where demand is very high, but where population and pallet generation are low, the price can be expected to be higher. On the flip side, a populous region that creates a lot of recycled pallets, but without a strong local demand, can be expected to experience lower pricing.

Seasons and Weather

Predictable wet seasons and extreme events can impact timber and pallet prices. Seasonal wet weather, or events such as hurricanes, floods, or forest fires, can limit access to timberlands, imposing significant challenges to loggers.

Mill investment and optimization

Pallets are made from low-grade or industrial lumber, which is a byproduct of grade lumber production by sawmills. Mills make more money from grade lumber than industrial, so they try to recover as much grade as they can. New softwood mills, featuring technologies such as computer laser scanning, offer significantly improved grade yield. Even though overall production is increasing in the U.S. South, total industrial lumber generation is declining, thus adversely affecting pallet lumber supply, resulting in higher priced material.

Competing and complementary markets for wood

Increased competition for industrial lumber from other sectors such as rail ties or flooring can also result in higher prices. There can also be complementary effects. Stronger demand for grade lumber and increased production can lead to the generation of more industrial lumber, and thus favorable pricing. Conversely, reduced consumption can lead to less industrial lumber in the market, as was the case after Chinese hardwood tariffs contributed to hardwood production curtailments in the Eastern United States.

External shocks: Policy and Pandemic

2020 provides great examples of how government policies and exogenous shocks can impact lumber supply, and ultimately, wood pallet prices. The UK’s decision to leave the EU demonstrates the influence that policy can have on the pallet market. Departure from the EU will mean that all wood pallets moving between the two markets will be required to be ISPM 15 compliant. Many companies have cautiously chosen to build product and material inventories prior to the effective date, thus resulting in increased short-term demand and higher pallet prices in the face of tight lumber supply internationally.

In North America, as industries such as construction ground to a halt during the early months of the COVID-19 pandemic, many mills curtailed production. By summer, however, construction returned, and the new housing market boomed. Due to the mill closures, lumber availability was tight, resulting in historic high lumber prices in the months that followed, until the supply could catch up.

In the final analysis, a new wood pallet, as a timber-based product, is subject to price fluctuation. The good news is that despite price movements, wood remains the most cost-effective and sustainable material available for pallet construction.

5 Ways to Eliminate Unwanted Wood Pallets from Your Business

Photo by Lucas Santos on Unsplash

Most companies benefit from sustainable and cost-effective pallet systems, and overall, wood pallets are highly recycled. The most recent research has determined that 95% of wood pallets in the United States are recycled.

For some businesses, however, empty pallets can stack up over time. When unwanted pallet accumulations get out of control, they can take up valuable space, require double handling, impede video surveillance, and catch the ire of corporate risk managers. While for small businesses, it might be enough to set them outside the fence with a “free pallets” sign, that is not an option for many companies.

If you waste valuable time and space handling and storing post-use wood packaging material, it does not need to be that way. Taking a circular approach can make a lot of sense – employing strategies that maintain the value of pallets through reuse, and ultimately, recycling when the pallet material is no longer of other use. Here are five ideas that can help keep your yard clear.

Wood Pallet Return and Re-use

Moving to a pallet return and reuse program can help control empty pallet buildups in some supply chains. In this type of program, the supplier retrieves the accumulated emptied pallets. In many cases, a superior quality reusable pallet will provide a better performance and a lower cost per trip even after considering the cost of reverse logistics, sorting, and repair.

Pallet reuse programs can save money and keep your parking lot free for its intended purpose. If the idea of managing a pallet retrieval program seems like an unnecessary complication, consider reaching out to a professional pallet supplier. Many companies offer custom pallet management services.

Conversion to a more common size wood pallet

Explore pallet size options. If you can convert inbound pallets to a popular size, especially the 48×40 GMA style pallet, they will be much more attractive for a pallet recycler to pick up from your location. A bonus is that recycled 48x40s are attractively priced. Other common wood pallet sizes include 40×48, 48×48, 48×45, 48×42, 48×36, 42×42 and 37×37.

At one time, before the growth of the pallet recycling sector, empty pallet accumulations were much more prevalent. Thanks to the pallet recycling expansion in recent decades, however, there is a strong demand, especially for the 48x40s. This demand helps pallet users keep their locations free from unwanted buildups.

Wood pallet rental

If you employ a 48×40 pallet, rental may be an option. In a pallet rental program, the shipper typically rents pallets on a one-way basis for shipment to customers. Emptied pallet accumulations at the customer location are then returned to the rental provider.

Pallet Flow-Through

Think about pallet flow-through as another possibility. This method was first pioneered over seventy-five years ago but used far too infrequently. Is it possible that your supplier can send goods to you on a pallet that you can then reuse in-house or for outbound shipment from your plant? Some companies purchase new pallets meeting their requirements and arrange to have them delivered to a supplier, so that once goods are emptied, the pallets can be put to work rather than needlessly stacking up.

Pallet Recycling

If none of the options above make sense, or if you have an immediate urgency to remove unwanted pallets, recycling might be your best option. Some plants that generate high volumes of custom wood pallets and packaging have wood grinding machinery onsite to reduce it to fiber. Many other companies contract with recyclers to take wood waste away. The cost of the service will depend in part on the recovery value of the material.

Recyclers recover wood to its highest possible value, including pallets, recovered pallet components, and finally, converting unusable material to fiber. Fiber is used for a range of purposes, including new board or sheet products, biomass, mulch, bedding, and more.

As a leading pallet association says, “Pallets move the world.” Remember that pallets support the circular economy by maintaining their value in various reuse and refurbishment models, or by being recycled into components and ultimately, fiber, as outlined above. That same circular approach also aids in keeping your location clear from unwanted accumulations of empty pallets. Contact a pallet professional to find out more.

Dr. Jennifer Russell

Talking To The Source: Dr. Jennifer Russell of Virginia Tech and the Circular Economy – Part 2

*Editor’s Note: The viewpoint and statements of the following post may not reflect the views of Nature’s Packaging, however, we are always committed to providing an open forum for all members of the forest and forest products community.

What is value retention and how do we all stand to benefit from it?

In the past 100 years western culture and society has become normalized to the idea that products can just be ‘thrown’ away – that things have no value once we are finished with them. Our focus on convenience, variety, and an expectation of low-prices means that products once made to last 10 years (e.g. clothing) now cycle through retail stores and personal closets within only a few months. And global waste streams are exploding with these ‘unwanted’ items.

But if we think about the entire life-cycle of a product — from the extraction of the materials, it’s fabrication and manufacture, its use, and what happens when it is no longer wanted — you get a different perspective on the inherent value of the product.

 Value can be related to the materials that are used, where they come from, how the products are assembled, who assembles it, how long it will last, and the variety of ways that it can be used, beyond the function that was originally intended.

Circular Economy challenges the us to find ways to extend product lives (e.g. make products last longer by designing them to be more durable, investing in maintenance, and finding opportunities to reuse, repair, refurbish, and even remanufacture them when they are no longer useful to the original owner).

Value retention is a fundamental shift in how we assess and understand the value of things – beyond price and brand – and thus, what we decide to do with those things when they are no longer wanted or needed.

Specifically, the Value Retention Processes that were studied in the UN Report relate to:

  • reuse – where a product gets to serve an additional life providing functionality to someone else, instead of being directed to landfill.
  • repair – where a product is returned to functionality for the original owner, through relatively smaller outlays of new materials, energy, and labor.
  • refurbishment – where a product is brought back to full functionality, and potentially even upgraded to provide new functionality and performance for a new user.
  • remanufacturing – a standardized industrial process where a product is fully disassembled, its component parts recovered and tested for quality, and those parts reassembled into a new product that meets or even exceeds the performance and quality standards for a new version of the product.  

Through these activities, we can reduce environmental impacts, create employment and revenue opportunities, and continue to use products that provide important functions for individuals, businesses, and governments.

What are some of the barriers to change and how can they be overcome?

One of the greatest barriers to change right now lies in the attitudes and behaviors of individuals. We have been normalized to expect ‘new’, without realizing the environmental cost of that expectation.

We have also been conditioned to see reuse, repair, and multi-service lives as something that could be a significant risk, from economic, performance, and safety perspectives. A cultural focus on consumer convenience, immediate gratification, and low prices, makes it very difficult for consumers to make more sustainable decisions.

An example of this is the cost of repair: Many people opt to replace a broken product because the cost to have it repaired is actually higher than the cost of the product. That initial price comparison is typically as far as the decision-maker goes; other important factors that are usually not considered are that the independent repairer owns a local community business, is highly skilled, is trying to make a living, and can prevent ~95% of the product from going into the waste stream.

On the other side of the example is the low-priced new replacement product: the low-price is often a factor of overseas production, lower product quality, and shorter lifespan. What is a ‘good’ decision in this example, and how can the consumer legitimately gather all of the details needed to make the good decision?

Many organizations struggle to know how to make changes to be more circular, and to effectively communicate these opportunities to shareholders and stakeholders.

A feeling that “…if it ain’t broke, don’t fix it…” often keeps organizations locked-in to conventional processes and approaches; in other words, it can be hard to get organizations to make changes until there is a crisis, such as a major supply chain issue.

How do wood pallets fit into the circular economy model?

There are three main principles of circular economy:

  1. To minimize the waste associated with the production, use, and end-of-life of products and materials.
  2. To extend the productive/service life of products and materials, and thus increase the productive utilization over multiple service lives.
  3. To regenerate natural systems.

The wood pallet industry already practices circular economy in many ways; particularly for wood pallets that are designed to have multiple service lives (trips), and for which systems are in place to recover, evaluate, repair, and reuse those pallets.

For the first principle, many wood pallets are constructed from wood that is actually by-product of another wood manufacturing process – thus, waste from another process is used as the input to wood pallet manufacturing. There are many examples of repurposed wood pallets – once these pallets are no longer viable to serve as pallets, they are often integrated into alternative uses, instead of being directed to landfill as waste.

For the second principle, wood pallets are often recovered and repaired multiple times by wood pallet companies as part of the planned service life of the pallet – thus, the design of both the pallet and the system integrates repair over multiple use cycles, rather than requiring a new pallet every time.

Finally, wood pallets are constructed of a durable biomaterial that can be used to regenerate natural systems when they can no longer be used for anything else.

Many wood pallet companies choose to mulch the scrap wood materials that cannot be used any longer for pallets, and this mulch can be used in landscaping and biosphere applications – thus, enabling some of the embodied materials within the wood to be returned to the natural system, although it is important that this is only done with wood that has not been chemically treated.

Wood pallets are an excellent example of circular economy principles, in practice; an important thing for the industry to consider is how to more fully-embrace circular economy thinking, and where these systems can be further optimized and improved to reduce negative environmental impacts.

Talking To The Source: Dr. Jennifer Russell of Virginia Tech and the Circular Economy

*Editor’s Note: The viewpoint and statements of the following post may not reflect the views of Nature’s Packaging, however, we are always committed to providing an open forum for all members of the forest and forest products community.

Dr Russell, what is your role at Virginia Tech, and what is your area of expertise?

 I am an Assistant Professor in the Department of Sustainable Biomaterials, at the College of Natural Resources and Environment. My area of expertise is in economic systems-modeling, with a focus on the environmental impacts associated with industrial use of resources and energy.

Our conventional economic system generates a significant amount of solid waste, consumes a significant amount of fuel and energy, and distributes a lot of pollutants into the water and atmosphere. This system becomes even more problematic when we consider that every product requires materials that must be extracted from the earth and that are destined to go to a landfill when the user is finished with it.

Given all of this, I study how we can incorporate innovative changes into business models and material flows in order to achieve a system that is more ‘circular’ — in which flows of waste materials and products can be integrated as inputs into new production and manufacturing. This effectively reduces the loss of valuable materials into landfills, and it offsets some of the need to extract new materials and resources for inputs to production.

Throughout this system, there are opportunities for reduced energy consumption, reduced emissions, and even increased employment opportunities. This alternative economic framework is called “Circular Economy”, and it is a concept that governments and businesses around the world are engaging with and adopting, increasingly, over the past 10 years.

What is your current area of research in the topic of the “circular economy”?

I am very interested in contributing to the realization and operationalization of circular economy practices and processes – in other words, how are we making these changes now, given the legacy systems, infrastructure, and cultures that exist (and that might pose challenges).

Much of the research in circular economy is focused on high-tech innovation and industrial solutions – these are very important; but also important are the activities, processes, and behaviors that are accessible to everyone around the world.

 For this reason, a lot of my current research is focused on the challenges and opportunities related to the increased practice of repair and reuse. Arguably, anyone in the world can engage in these practices, and there are not really many stringent barriers to people participating in repair or reuse.

These processes have also been common-practice for many communities for centuries – they are not ‘new’; However, the ways in which we value these activities, as a society, has changed. Where, a century ago the mending and repairing of goods and equipment was common practice and expected, many categories of goods and equipment have become ‘disposable’; there is a lot of evidence of the decline of the independent repair community, and the relegation of reuse to something only done for charitable purposes.

Other ways I am exploring this theme of ‘operationalizing circular economy’ is through the lens of local policy solutions – how are community leaders and municipal governments engaging with the ideas of circular economy to move it forward in ways that respect local conditions and priorities.

You recently co-authored a UN report, “Re-defining Value – The Manufacturing Revolution”. Why is re-thinking how we manufacture industrial products and deal with them at the end of their useful life so important?

Industry’s singular pursuit of ‘efficiency’ has led to some major environmental and economic challenges. Not only do we have millions of tons of valuable materials being sent to landfill each year because, as a society, we have become normalized to the idea that things can just be ‘thrown’ away; we are also facing a realization that many of the resources and materials that we have relied on for the past 100 years are finite, and that we might actually run out of them.

Although the word “sustainability” is now used in a variety of ways, fundamentally, industry decision-makers are starting to think about the longevity, security, and resiliency of their supply chains – our ability to ‘sustain’, ourselves, our economies, our health, our way of life, and the future of our children.

The analogy of a “linear economy” really highlights this challenge: We take materials from the ground; we convert them into products; we use those products; and then we throw them away – a figurative “take–>make–>dispose” system. When we manufacture products in a linear system we also generate other negative environmental impacts associated with production: for every new product made, energy and fuel are consumed, solid waste and pollutants are generated, and emissions are released into the atmosphere.

Unlike nature, a linear economy does not replenish stores of valuable materials, and it does not return any nutrients back into the environment; it depletes resources in one place, and concentrates wastes and valuable materials alike into inaccessible landfills. It is easy to see that this model is really not sustainable at all.

The idea of cycling materials, components, and products within a circular economy is really about mimicking nature: In a forest there is no waste – every item within that ecosystem is part of an elaborate food web that includes plants, bacteria, herbivores, omnivores, and carnivores. The solution to our challenge of finite materials and environmental damage is to find the industrial analogy of a food web: In other words, how can we organize and manage material and product flows so that there is no waste, and so that we do not run out of the materials we need to keep our economies running?

Goals to achieve zero-waste to landfill can be helpful, because they focus on finding valuable applications and outlets for materials and products that are no longer wanted by the original owner. However, we cannot rely on recycling alone: Only a small subset of products and materials can be recycled; many products have components and materials that are so integrated, that we cannot separate them out to be recycled (e.g. old laptops and smart phones); and recycling processes can require a lot of energy. Further, many of the products entering the waste stream are still functional and have a lot of residual value.

Many of these waste stream challenges can be addressed much further upstream in the process, through improved design and manufacturing practices: designing products to be easily disassembled, easily repaired, modular, and/or upgradable are key ways that we can enable a product to have multiple long service lives.

Manufacturing products and reorienting business models in a manner that allows for the use of recaptured parts, instead of new parts, can significantly reduce the amount of new materials that are required for production, as well as the associated cost, energy, and time.

Join us next week on the Nature’s Packaging Blog for Part 2 of this interview.

Pallet Pool Class Specification: How does it affect supply?

When there are potentially millions of pallets in a pool, why do pallet buyers sometimes experience delays in filling an order? Often it can come down to the class (or grade) of pallet needed, according to one pallet broker who spoke anonymously to Nature’s Packaging.

For example, the customer requires a very high class 48”x40” pallet such as a “premium A grade” – one that looks almost new. If a pallet supplier does not have a ready inventory, a period of time might be required to recover the required amount from incoming empty pallets being recovered, sorted, and repaired.

In the case of the 48×40” pool, pallet recyclers produce a variety of grades from those incoming pallets. The higher grade ones are typically in greater demand and in shorter supply, so available supply can be an issue.

Even in the case of pallet rental programs, customers with extremely rigid quality requirements may require new pallets or pallets that have just been repaired versus sorted pallets, which can result in more limited availability.

It can seem counterintuitive that in a pool of possibly millions of pallets that there might tight supply, but that can be the case when the customer’s expectations are more stringent than that found overall in a pallet pool.

How pallet classes are managed in pallet pools

Some pools have detailed pallet specifications that must be met by pallet manufacturers as well as by pallet repair providers. This approach is followed by major pallet rental pools as well as cooperative groups such as EPAL – the European Pallet Association. Such pools utilize  inspection personnel to ensure that pallets are properly classified.

One point of separation is whether the pallet is designated for a “one-way” model or an “exchange” model. Some rental systems, particularly in North America, rely on the one-way approach.

Once wood pallets are emptied of the product by customers, they are returned to the pallet company service center for inspection and repair, if necessary. Such an approach provides for a classification assessment before pallet reissue.

In an open or exchange model, however, pallets may be redeployed without classification, and as a result, there is a greater likelihood of lower grade pallets in the pool.

Mind you, many product manufacturers require high-grade pallets to work efficiently with palletizers, conveyors and other automation, and so they will, by necessity, remove lower grade pallets from circulation and supplement, as needed, with higher grade pallets.

All of the pallet pools above can be categorized as formal pallet pools. They have detailed pallet manufacturing and repair specifications as well as ongoing management to ensure their ongoing viability. Other pools can be categorized as “informal” or “common” pools. One of these is the 48×40” whitewood pool in North America.

Unlike the other pools discussed above, the 48×40” whitewood pallet does not have a detailed specification, nor does it have an administrative body to manage any inefficiencies or challenges.

The pallets typically have similar overall dimensions but can vary regarding deckboard thickness or stringer width, for example, or in terms of lumber species and grade. It is a market-driven pool that reflects the purchase decisions made by pallet buyers.

As a result, there is considerable variety among pallets, which can create challenges in meeting supply when a customer has particular classification requirements. Typically, these challenges can be overcome when pallet providers have users clearly communicate their pallet needs to them. 

When pallet buyers have trouble sourcing pool pallets of higher grade, there are a variety of approaches that they can take:

  • If you are retrieving empty pallets from customers, work with a service provider who will pick up pallets as well as inspect and repair, as necessary, prior to returning them to you.
  • Work with a pallet service provider who offers on-site sorting and repair services.
  • Pursue longer-term relationships with pallet suppliers so that they have time to accumulate the required grade and ensure availability. In the case of the whitewood pool, another approach is to buy new pallets, thereby ensuring they meet requirements, and also boosting the overall availability of higher grade pallets in the pallet pool.
  • Develop a proprietary pool. Another way to retain grade classification  in a pool is to invest in higher quality pallets made from higher quality pallet components . Incremental investment in pallet quality such as better nails, for example, can result in reduced frequency of repair and a much longer pallet life. This, in essence, is the approach that has been taken by pallet rental companies. It is an approach also taken by companies that run proprietary pallet pools, where it makes sense for a particular supply chain.

Ultimately, pallet classifications in a pool can have a big impact on sourcing the pallets that you need, when you need them. As outlined above, however, there are solutions at hand to help you meet your pallet requirements.

 

Talking to the Source: A Conversation with Leigh Greenwood of The Nature Conservancy

*Editor’s note: The viewpoint and statements of the following post may not reflect the views of Nature’s Packaging, however, we are always committed to providing an open forum for all members of the forest and forest products community.

What does your organization do, and why is solid wood packaging an area of interest to it?

The Nature Conservancy is a global nonprofit with a mission to conserve the lands and waters on which all life depends. This means that we are an organization working around the world to protect all ecosystems from many types of damage- and forests are an incredibly important ecosystem.

Forests face many threats- illegal deforestation, forest fires, drought, attacks by insects and diseases, and more- and unfortunately, solid wood packaging can become a threat to the health of forests when it is infested or contaminated (either in the wood or on the surface of the packaging) with tree-killing insects and diseases.

What is your role? What does your day look like?

I’m the Forest Health Program Director, which means I spend my days working with colleagues and partners all around North America on the issues where I think we can make the greatest difference on the issue of non-native insects and diseases that reduce the health, safety, and beauty of our trees and forests.

Most days, I spend my time emailing and video conferencing with partners on my current focus areas; pests that can be better managed via improved firewood outreach and regulations, and pests that can be transported accidentally as part of the global supply chain.

Why do we need ISPM-15? What has happened in the past to warrant its creation?

Forest pests that infest live trees, like bark beetles and wood-boring beetles, are particularly problematic because they are both very damaging, and easily moved in infested packaging materials. ISPM 15 was created to allow for a set of approved treatments (usually heat treatment, but other listed treatments are acceptable) that render the wood in solid wood packaging functionally very unlikely to contain live pests.

Several types of very damaging insects- most notably the Asian long-horned beetle were being repeatedly transported internationally in infested pallets, which then led to a series of very serious insect infestations in the recipient countries.

ISPM-15 was designed to dramatically decrease the risks of using solid wood packaging so that this important part of the global supply chain could continue to be used around the world without further destruction of forests from these pests.

What is an example of an issue on your radar screen right now from an ISPM-15 perspective?

The ISPM 15 standard relies on the effectiveness of the plant protection organization (PPO) at the pallet’s country of origin to ensure that the treatment and stamp is conducted and applied properly. For instance, if a product is produced, boxed, and palletized in England and then shipped to the USA, it is the responsibility of UK’s Department for Environment Food & Rural Affairs to ensure that the treatment is correctly applied, not the responsibility of the receiving entity in the USA.

So the forest pests that I am most concerned about are not particular insects or diseases- but rather I am concerned about the chance of new and potentially very damaging forest pests in pallets originating in countries where the treatments required by ISPM-15 aren’t being adequately or consistently enforced by their PPO. While a given pest might be worrisome, the idea that many different types of pests might be coming in repeatedly from regions with poor enforcement is an even bigger issue in my mind.

What are the most worrisome types of pests- and why are they particularly concerning?

The pests that are accidentally transported in or on solid wood packaging can be roughly divided into two types- primary (wood infesting) pests, which are already in the bark or wood when it is initially harvested as a tree, and secondary (surface hitchhiking) pests, which attach later onto the surfaces of the packaging.

Primary pests like the Asian long-horned beetle can be well controlled with good consistent adherence to ISPM-15 by all trade partners- but there are some primary pests, and many hitchhiking pests, that I believe currently do not have sufficient policies and regulations in place to prevent them from entering North America. So what worries me is what might fall through the cracks- highly heat resistant pests, hitchhiker pests that contaminate pallets or crates after ISPM-15 treatments are completed, and others.

What would be your takeaway message to the forest products industry and to the wood packaging sector in particular?

The long term viability of solid wood packaging materials in international shipping will depend on outstanding international cooperation in adhering to ISPM-15. It is incredibly important to work with trade organizations and shipping specialists overseas to ensure they know about ISPM-15, why it is important, and how to comply. Solid wood packaging can be just as safe as any other shipping material if it is treated appropriately.

Talking to the Source: Conversation with a Lumber Broker

Lumber yard with forklift carrying a random length load

For this blog, Nature’s Packaging reached out to a lumber wholesaler based out of Canada within the Quebec province. The company supplies products to the wooden pallet industry as well as the fence industry. 

NP: What does a lumber broker do?

A good lumber broker offers value added to the product: when a mill is down, he should be able to ship from another mill. He can also offer different alternatives such as softwood, aspen, hardwood as well as different grades and dimensions. Most mills are specialized and limited to a certain number of dimensions and species.

By talking to customers in many states and areas, and talking to mills in different areas, the broker has a broad view of what is happening in the market. From the log situation to demand, the broker has a global understanding to share.

Good brokers have a diversified team communicating with hundreds of customers and many suppliers. Different personalities, different contacts, different experiences bring a wider range of perspectives.

Can you tell us what you do on a daily basis?

Our team talks to mills every day. We visit them on a regular basis. We are involved when it is time to look at new equipment so the production meets the customer’s requirements.

We also listen to our customers to match their needs with the mill’s capacity. Our participation in different associations keeps us well informed of the legal changes, the technological improvements, and allows us to network with equipment suppliers and help the mills and customers.

Industrial or lower grade lumber isn’t worth as much as premium grades. Why is it important to the overall lumber market, and particularly for wood pallet and packaging manufacturers?

The mills need to make money. Some cut higher grade logs and produce grade lumber. Some scrag mills produce only pallet grade lumber. SPF and SYP mills produce commodities that represent 80% of their products but the pallet lumber prices can make the difference between a good year and not making it.

It is important to be aware of what is going on in the higher-grade markets because they are directly affecting industrial lumber prices. When premium, #1 & #2 and stud prices are as high as they are today, it forces the builder to use #3 grade that is usually going to the Industrial markets, making availability and prices shift very quickly.

What about logistics and transportation management? Why is this area important to lumber supply?

Customers want “just in time”, they do not want inventories and mills needs cashflow. So scheduling the production, then the shipments to meet customer’s needs is an everyday challenge. Freight costs and availability change with demand and fuel costs.

Respecting the truckers and nurturing good relationships with them is as important as paying fast. Good people, good software, and great relationships are key ingredients to a high-quality logistics program.

The price of lumber has been particularly volatile, lately. What types of events cause such price movement, and what can you, as a lumber supplier, do to help buyers through such times?

COVID has changed our lives. Instead of traveling, we work from home, we cook more, we are building a new fence, a new deck, painting the house, building a shed…so that our “cocoon” is better and we keep busy!

Pallets move the world so your paint comes on a pallet, the screws, and nails for the deck and fence as well as many renovation products. Demand for lumber went up just as many mills were missing workers because of COVID.

Our job has been to work with our customers at trying other species and dimension, changing the ratios of 3 ½’’ vs 5 ½’’ to have a better supply. I cannot share all of our secrets but we have been supplying lumber solutions to many customers.

What are some of the biggest mistakes that customers make when it comes to lumber buying?

Some do not know what their actual cutting costs are and what their waste factor when cutting their own wood. When comparing to pre-cut lumber we can see that price is important, but the waste factor is part of the costs too.

Buying the lowest bidder can be dangerous. It is better to spread a bit and have more diversified sources. Working with a supplier when a problem happens is better than rejecting the load and leaving the other to deal with the problem.

If you could give lumber buyers one or two key takeaways from this interview, what would it be?

Suppliers are as important as customers. I can have all the customers but if I do not have the lumber, I am useless. If I have all the lumber and all the customers, I still need the truckers and they need to be treated with respect too.

Finally, a good broker must be competitive but is not always the cheapest. The team of professionals provides market information, is there to find lumber solutions for you, to bring various mills, species, dimensions, and grades so you can provide the shipping platform solutions your customers need.

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