BLUMENORT, Manitoba — South-East Pallet & Wood Products has emerged as a leader in the pallet industry of southeast Manitoba, and the company has diverse options that enable it to find markets for all of its wood fiber.
Company Transition to Match Market Changes
The company, formerly dependent on producing limited softwood lumber products and which operated as South-East Forest Products, was willing to adjust and adapt to changing market conditions
When lumber markets were tough about a decade ago, the company’s leadership made adjustments within the mill to begin serving the wooden pallet industry. Equipped with a Baker Products resaw line, it began a fairly easy transition into sawing pallet cut stock.
The company made additional investments in machinery as demand for pallets and pallet lumber grew. In recent years South-East Pallet put in a new sawmill and cut-up line to process logs into pallet components. Baker Products supplied the majority of the equipment for the new mill, which began operating in March 2015. That same year the company also invested in its first automated pallet assembly system, a new Viking Turbo 505 nailing machine.
South-East Pallet is located in Blumenort, a small community in the southeast corner of Manitoba; the town is a little over 30 miles southeast of Winnipeg and less than 50 miles to the U.S. border and Minnesota. It had its roots in the 1950s and was a family-owned logging business that also produced softwood lumber.
Before entering the pallet arena, the company contracted with portable sawmillers to process logs into cants at the landing. The cants were hauled to the company’s mill to be resawn into 2×4 and 2×6. The lumber was kiln-dried and surfaced for sale.
South-East sales manager Jac Siemens described how the company entered the pallet industry. A local business that habitually experienced a shortage of pallets to ship its products asked if South-East would supply them with pallets. At the time, South-East had about one million board feet of downfall material that was not suitable for 2×4 or 2×6; it utilized this material and began building pallets, assembling them by hand with pneumatic nailing tools. Eventually, it was able to use all the downfall material in its budding pallet operations. “Slowly, as we gained market share, we continued to grow,” said Siemens.
South-East had to make considerable changes when it made the transition from lumber producer to pallet manufacturing. “The process on the yard needed to be rebuilt…to better service the pallet business,” said Siemens. The company has experienced “tremendous change,” he acknowledged. The person guiding the company through the transition and setting the tone was its long-term owner and managing director, Darrel Penner.
South-East Pallet Relies on Baker Equipment
The company is still enjoying steady growth. Pallet sales have more than doubled in the past five years, and employment has increased from about 26 employees to about 42 in recent years.
South-East’s operations are contained in three buildings — including a new sawmill building — with about 25,000 square feet under roof.
Baker Products supplied a complete scragg mill system for South-East Pallet to enable the company to process logs into finished pallet lumber, including all Baker machine stations and material handling equipment.
Logs are loaded in the yard onto a four-strand that drops them onto an hourglass roll case infeed carrying the logs to a 48-inch slasher saw where they are bucked into bolts. The bolts are fed automatically onto a three-strand deck directly to the Baker circle tri-scragg, which utilizes a sharp chain feed with links every 4 inches to move the bolt past two 48-inch, 50 hp circular saw blades, removing two sides at once. The two-sided scragg block is fed inline through a Baker horizontal bandsaw with the aid of self-centering wheels that center it and eliminate twisting; the band blade splits the scragg block into two three-sided cants, ready to be resawn.
The three-sided cants are moved via a 90-degree chain conveyor to a Baker double-end trim saw to trim the material to length. The cants then flow to a three-strand lateral staging conveyor where pop-up rollers convey them into one of two resaw lines. Each line consists of five Baker horizontal bandsaws inline with a return system for material that requires additional resawing. Each resaw line feeds directly into a Baker hopper feed de-duster to clean the lumber before it is emptied onto a conveyor to be pulled and stacked.
The system also features a Baker band edger set up near the circle tri-scragg. Slabs from the circle-tri-scragg drop onto a conveyor that carry them in the edger, which consists of two vertical bandsaws. The edger processes the slabs into additional three-sided cants that are routed to the system of material handling equipment that feeds the cants to the double-end trim saw and resaw lines.
A waste conveyor and transfer system collects all log end cut-offs, edgings, trim ends, and other scrap material.
Baker manufactured and supplied all machine centers and material handling equipment and also supplied stacking racks for finished lumber.
Baker later added a double-head stringer notcher with unscramble feed to the end of one of the two production lines so that stringers exiting the de-duster on one line would be conveyed to the notching system.
“We worked closely with South-East to make sure we understood their needs and concerns,” said Clay Hedrick, a representative of Baker Products. The system design was revised a number of times in order to meet the requirements of the South-East application, he indicated.
South-East, which is a member of the Canadian Wood Pallet and Container Association, uses mainly pine for pallet lumber although it also cuts aspen. “It depends on our customer wants,” said Siemens, as well as what kind of timber the logging division is harvesting.
The company primarily manufactures new pallets although it does retrieve used pallets from some customers and provides some recycling services. The most common new pallet is a 48×40 stringer pallet. The company also manufactures block pallets although it has limited customers that require them. It also supplies specialty custom pallets for customers.
Most pallet customers are agriculture-related businesses. “We work with the customer to meet their needs,” commented Siemens. “It’s always about getting value along with a product that meets their specific needs. Pallets are a commodity that are available elsewhere, so it comes down to service and the relationship with the customer.”
There are other pallet companies servicing businesses in the region, but most of them focus on pallet recycling, according to Siemens. “They also produce new pallets, but not to the same extent.”
South-East also offers heat-treating services for export pallets that comply with ISPM-15. The heat-treating process is carried out in the company’s Irvington-Moore dry kiln. Certification of the company’s heat-treating process is through the Alberta Forestry Association.
Siemens originally was hired as general manager in 2011, but just recently he moved into the role of sales manager in order to focus on continuing to grow the company’s sales. The company appointed a new general manager, Sjoerd Huese, who will be focusing on continuing to improve efficiency, reduce operating costs, and implement safety standards, among other tasks.
Firewood Gives South-East Pallet a New Product Line
In addition to manufacturing pallets, including pallet stock for other pallet manufacturers, South-East added firewood operations this year. The company also has developed markets for other residual wood products, such as landscape mulch, including colored mulch, and sawdust, bark and biomass. South-East Pallet & Wood Products, has seen its business grow, and employment has increased from about 26 employees to about 42 in recent years.
For its new firewood operations the company invested in a Cord King M20-30 firewood processor. The company’s management talked to other people in the firewood business to get recommendations for firewood processors, according to Siemens. Cord King was “one of the better machines out there,” he said.
The company received its new Cord King machine this summer, and it has worked out “very well,” said Siemens. The company produces pine, birch, tamarack, oak, and ash firewood. It sells firewood off its wood yard and also offers delivery service.
There are other firewood businesses serving the area, noted Siemens. “The market is already taken up,” he said. “We have to provide a service and convenience” that is more attractive in order to capture some of that market share.
Although its principal market is homeowners using wood for fuel as a primary or supplementary source of heat in the winter, another market consists of people who use campground facilities about an hour away. The company is selling bulk firewood to campground facilities. It is also offering a “weekender bag” of firewood that has proved popular with area residents who stop by and buy firewood for a weekend of camping.
Firewood packaged in tote bags is a marketing technique that has worked well for South-East. The bags have handles so they can be easily loaded with a forklift or skidsteer; one tote can hold one-fourth of a cord and the other, one-sixteenth of a cord.
The firewood division, which operates under the brand Firewood2Go, has its own website (www.firewood2go.ca) with complete information about firewood products and pricing.
What to Do With Wood Waste?
The new sawmill brought another challenge. In the past, when portable sawmills initially processed logs into cants at the landing, all residual materials were left at the landing. Now, the company is required to deal with all the residuals from its sawmill and lumber manufacturing operations: bark, slabs, scrap wood material and sawdust.
The company collects and markets all residual material. “All residuals are sold into a different value stream,” explained Siemens. “No wood fiber goes into the landfill.”
Sawdust goes to a collector outside the mill and directly into a walking floor trailer that is filled about every 12 working hours; the sawdust is sold for bedding material to dairy and poultry farmers in the region. The company invested in a Rotochopper machine to grind scrap wood into biomass and also landscape mulch, including colored mulch produced with Colorbiotics colorant; mulch is sold both wholesale and retail through the Mulch2Go division. Slabs and other scrap wood end up in a bunker to be made into firewood or moved to the Rotochopper to be processed by grinding. Bark is sold to landscaping businesses.
South-East relies on some well-known brands and some regional companies to supply some tools and equipment. The company continues to try various bandsaw blades, but the blade it has come to rely on most is the Simonds Red Streak, which it obtains from a regional distributor. The cutting tools for the Baker Products notching machine are supplied by another regional company, Professional Grinding.
For its Viking automated pallet assembly machine, South-East purchases bulk nails from Viking. Pallets that are assembled by hand are nailed with Bosch pneumatic nailing tools.
A U.S. supplier — Iron Bull Manufacturing — has a role in South-East’s firewood operations. Representatives of South-East came across Iron Bull when the supplier exhibited at the Richmond Expo in Richmond, Virginia, in May. “They have a lot of interesting products,” said Siemens.
South-East subsequently ordered an Iron Bull self-dumping hopper. It enables the company to safely, easily, and efficiently load a half-ton pickup truck with a measurable volume of firewood, one-third of a cord.
Prior to purchasing the Iron Bull hopper, South-East did not offer a loading service for pickup trucks. Now, the innovative self-dumping hopper allows the firewood to be loaded easily, quickly, and safely, without damaging a truck bed. South-East also is using the Iron Bull equipment to load landscape mulch into pickup trucks.
“We’re very happy with it,” commented Siemens.
