Circular Supply Chains Inc.

Do you realize that we produce about 500 million pallets a year in the US alone to replace the worn pallets that we discard each year? The number of pallets out there is truly staggering. Nearly 2 billion wooden pallets are currently in circulation in the US with a majority of them replaced each year. This consumes an estimated 50 percent of the country’s annual hardwood harvest and is equivalent to 7.6 billion board feet of lumber. That’s enough wood to cover an area 10 times the size of New York city. This also represents a very significant market for the lumber industry to the tune of $6 billion in annual sales especially when one considers that roughly half of these pallets are intended to be used only once and then discarded. And since the pallets tend to be full of galvanized nails that are hard to remove, a large percentage of these single-use pallets usually end up in landfills.

This seems such a waste when you consider that companies can derive revenue from timber byproducts such as fuel pellets, building materials, mulch, insulation, and many others. I wonder what readers might make of the fact that one single application consumes as much hardwood in the US annually as all others combined? These facts have led some environmental groups to label wooden pallets as a major waste of resources and to call for their replacement with more ecologically friendly alternatives.

And some in industry appear to be doing just that. For instance, IKEA, the world’s largest provider of home furnishings, recently announced plans to phase out corporate use of wooden pallets and replace them with recyclable paper pallets. Among the reasons cited is the fact that wooden pallets currently account for 50 percent of the company’s total global use of pine and spruce.

To shed some light on the history of the pallet, it is rooted in sea and railroad travel, where it originated as a skid. Skids are essentially a simpler version of the pallet. But, they lack the lower set of boards that make pallets so versatile. Skids were hand carried and moved one by one. The invention of the gas-powered forklift in 1937 was the initial push of efficiency that lead to the modern-day pallet.

The second catalyst was the start of World War II. Though warfare may seem to be a far cry from wooden pallets, streamlined logistics during wartime are vital to success. For the U.S., the added efficiency of forklifts and pallets meant more time and resources for vital military operations. WWII popularized the pallet and made it a global staple for efficient shipping. The fact that pallets played a role in the U.S.’s WWII success should be testimony enough for their importance. But, pallets continue to streamline logistics and benefit shipping needs around the world. According to a recent article on the importance of pallets, pallets carry about 80% of U.S. commerce. Though shipping is changing and its trends can come and go, the pallet continues to be a steadfast part of the industry.

So, we obviously need pallets in the supply chain but, at what cost? If a pallet is to be used for international shipment it must either be heat treated or doused in methyl bromide to insure that infectious bugs or disease are not carried to other continents. Heat treated pallets do not represent a problem for the pallet’s reuse or recycling but methyl bromide treated pallets are not suitable for reuse or recycling of any kind due to the toxic nature of the chemical. And what does this add to the leaching problems that often occur in the landfills where they usually end up?

We’re not always the smartest group us humans. It seems to be in our nature to apply quick fixes to the problems at hand without much thought to repercussions down the road. The pallet is a smart idea for the movement of bulk goods but to make them out of wood and then treat them with noxious chemicals makes one wonder if the immediacy of the solution was given any afterthought at all. Some would argue that wood is a relatively cheap and renewable resource with lightweight properties that make it ideal for pallet production but, when you consider that trees are the perfect filtering device for CO2 capture and represent the lungs of the earth, it seems hard to justify any sort of cost/benefit advantage. When treated with methyl bromide we eliminate any possibility of reuse or recycling completely.

Let’s consider some facts about wood pallets.

• Every year in the US alone 1 million acres of our planet’s trees are destroyed to manufacture and produce the wooden pallets used to operate the distribution industry.
• To replenish 1 million acres of trees will take approximately 40 years.
• Estimates show we lose 137 animal, plant and insect species each day due to deforestation, equating to 50,000 species every single year.
• Because of methyl bromide’s harmful effects on the Earth’s Ozone layer, it will soon be banned through the UN’s Montreal protocol.
• Wooden pallets have become a major factor in out planet’s deforestation. deforestation is one of the largest contributors to global warming and our earth’s sudden spike in temperatures.
• Wood dust is found in pallets and is a carcinogen associated with nasal and sinus cavity cancer, lung cancer and Hodgkin’s disease (cancer of the lymph system which creates your antibodies).
• According to the World Resource Institute, more than 80 percent of the earth’s natural forests have already been destroyed.
• 54% of wood pallets are used for only one shipment, and then either stored, burned or thrown away.
• It is estimated that nearly 30% of CO2 buildup in our atmosphere can be attributed to deforestation over the past 150 years.

Now let’s look at some facts about recycled aluminum.

• Every three months, Americans throw enough aluminum in the landfills to build our nation’s entire commercial air fleet.
• Much of aluminum’s recycling value comes from the energy saved when making aluminum from recycled material; it requires 95% less energy than making it from primary bauxite ore.
• In the United States, over 100,000 aluminum cans are recycled each minute. That amounts to 53 billion cans recycled in 2010.
• The U.S. recycling rate for aluminum beverage cans reached 58.1% in 2010.
• About a third of all aluminum on the U.S. market is recycled scrap.
• 75% of all aluminum ever smelted is still in use.
• Aluminum cans have 68% recycled content.
• Twenty recycled aluminum cans can be made with the energy needed to produce one can using virgin ore.
• Recycling one aluminum can saves enough energy to run your television for three hours.
• The amount of energy saved just from recycling aluminum cans in 2010 is equal to the energy equivalent of 17 million barrels of crude oil, or nearly two days of all U.S. oil imports.
• Aluminum can be recycled forever with NO loss of quality (good thing since we use over 80,000,000,000 aluminum cans each year).
• Altogether, aluminum from recycled cans and other products account for about 50% of the aluminum industry’s raw material metal supply.
• Recycling is so efficient that it can take as few as 60 days for an aluminum can to be collected, melted, made into a new can and awaiting purchase on a supermarket shelf.
• Recycled aluminum is the only material in the consumer waste stream that more than pays for its own cost of collection. Recycling one ton of aluminum cans typically yields well over $1,000 of revenue, while recycling a ton of steel, glass, plastics, or paper does not cover the average collection cost of $200 per ton.

Finally, let’s look at recycled aluminum pallets.

• Weighing only 45.5 pounds each, aluminum pallets are lighter than wood & plastic alternatives.
• More than a 50,000 lb. load limit, and maintain standard dimensions throughout their lifetime.
• Aluminum pallets are 100% infinitely recyclable.
• Unlike wood and plastic pallets, aluminum pallets are completely fireproof.
• No protruding nails or broken boards to injure employees or damage equipment or products.
• Aluminum pallets do not absorb liquids and are impervious to infestation. They are easily cleaned and can be used in sterile environments.
• Aluminum pallets can be color anodized and Laser Engraved for easy identification and brand recognition.

Wood pallets are costing us more than just money when you consider deforestation, toxic chemical leaching in landfills, harm to the ozone layer and the carcinogenic qualities. We need a paradigm shift in the way we think and act regarding the use of wooden pallets in our supply chains because, as the title of this post states, “wooden pallets cost us more than you know!”