Officials in the European Union (EU) have targeted packaging waste as a key issue to reduce the environmental impact wants of its citizens. Their aim is to reduce packaging waste, encourage more reuse and boost the utilization of recycled materials. Instead of taking on various segments of packaging and the supply chain in small chunks, the EU is considering new regulations that could affect everything from food packaging to take-home containers at restaurants to wood pallets.
Although the rules have not been finalized, the proposed Packaging and Packaging Waste Regulation (PPWR) seeks to achieve increased recyclability and recycling by setting fairly strong targets. The European Parliament just modified the proposed regulations to include a reuse target exemption for pallets that come from non-EU countries. The major driver for this change is that EU officials do not want the PPWR to disrupt the flow of goods and supply chains coming from other regions of the world. Other concerns include mandates that could have unforeseen consequences. For example, it would be difficult, if not impossible, for packaging providers for other countries to provide the reuse data mandated by the PPWR.
These changes were recently confirmed by the National Wooden Pallet & Container Association (NWPCA), which has been lobbying EU officials to consider the global impact of the existing drafts of the PPWR. The NWPCA has been working with the Canadian and European trade industry to coordinate responses and collaborate with outreach to government officials.
Jason Ortega, the vice president of public affairs for the NWPCA, commented, “The NWPCA has been engaged with this issue since this summer. We’ve certainly put a good amount of resources into it. I’ve been over to Brussels twice. I’m going over again in January for a third time.”
Ortega commented, “When we assessed the initial proposals, we found a number of things that would be challenging for the industry globally. Very few people know where their pallets end up. What we opted to do was to focus on the rules that would affect the global pallet industry because there were a number of challenges that are best left to the Europeans to tackle.”
It wasn’t clear from the draft legislation what is going to be required in terms of pallet specs, data/tracking and other issues to comply with the proposed PPWR.
A potential major concern for U.S. pallet users is the requirement that packaging be reusable. Most of the pallet sizes and styles used in the North American market do not meet European standards. Currently, the most popular size pallet in Europe is the 800x1200mm block pallet belonging to either the EPAL or EUR systems. Stringer and 48×40 pallets don’t fit well in European supply chains. Many of these pallets end up being discarded or burnt for fuel.
So, the good news for U.S. and Canadian producers is that the Parliament version of the law only applies reuse targets to transport packaging “only used for transportation within the territory of the Union.” This language is much better than the original version issued by the EU Commission and is a bit better than the language developed by the EU Council. Now that the EU Council has finalized its version, the next step is ‘trilogues’ which will be a negotiation between the three bodies (Commission, Council, Parliament) to reach a final version.
Pallet users may still request the use of Euro pallets instead of 48x40s for shipments to the EU. But that is nothing new. Some customers who were willing to pay more have been doing that for while so that the pallets they receive from other parts of the world can be more readily reused in the EU. The big difference is there won’t be government mandates associated with penalties and data submission requirements.
When challenging the initial drafts, the Global Wood Packaging Forum (GWPF), a consortium of wood packaging trade associations around the world, wrote, “The GWPF fully supports the ambition of the PPWR to make all packaging in the EU market recyclable. Wooden packaging is fully recyclable, and wood pallets are the supply chain’s most repaired, reused and recycled packaging. An estimated four billion wood pallets are used daily in Europe, yet there is no evidence that wood packaging materially contributes to the EU landfills.”
The GWPF went on to suggest, “As drafted in the original Commission text, the transport packaging reuse requirements would disrupt the supply chain for importing critical products like vaccines, pharmaceutical medicines, and medical devices and increase costs for these vital products. It would be similarly disruptive for the export of goods from the Union to key trading partners.”
Another potential concern was data tracking associated with reuse targets. How does a pallet company gather this data especially if it doesn’t have a footprint in Europe? One potential solution is that the European Pallet Association (EPAL), the largest open pooler in Europe, just launched a new QR code for its pallets. But it will take years for this code to be applied and used widely to track pallet movements across the EU.
Now that the EU Council has finalized its version, the next step is ‘trilogues’ which will be a negotiation between the three bodies (Commission, Council, Parliament) to reach a final version. The EU Parliament stated, “Parliament is responding to citizens’ expectations to build a circular economy, avoid waste, phase-out non-sustainable packaging and tackle the use of single use plastic packaging.”
Looking at the specifics of the proposed legislation, it sets recycling targets for wood packaging to be 25% by the end of 2025 and 30% by the end of 2030. It would also require that all packaging be designed to be recyclable by January 1, 2030. The PPWR also sets reuse and refill targets for particular types of packaging. The current version sets transport packaging (pallets, crates, pails and boxes). It sets 30% to be reusable by January 2030 and 90% by January 2040.
The specific targets don’t offer practical details for how the pallet rules are to be imposed and monitored. But the industry is currently involved in conversations with EU officials to help shape how these rules impact palletization.
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