Price is still king even though environmental benefits count in the court of public opinion. When it comes to pallet procurement strategies, carbon and sustainability benefits have taken a back seat to pallet price for most buyers, according to the most recent survey conducted by Modern Material Handling magazine. However, when you read press releases about major pallet initiatives, carbon and environmental claims are among the most common reasons cited for new pallet programs.
Fortunately, efforts to cut pallet-related costs often prove to be beneficial regarding sustainability initiatives aimed at reducing transport, material or energy costs. Additionally, wood products offer significant benefit in sequestering carbon, and in helping the ongoing harvest of timber from sustainable forests. The result of this process is higher carbon capture, which is another important environmental benefit.
For the pallet industry, the environmental angle has become a major selling point for alternative materials (primarily plastic, composite and paper pallets). Most major material types offer some benefits when it comes to carbon footprint claims, including wood pallets. The most recent noteworthy challenges have come from Change the Pallet, a paper pallet non-profit, which has focused on the transportation angle. This campaign emphasizes the lighter weight of paper pallets compared to wood when under load, and the resulting reduction in diesel fuel. It also notes the decline of freight required for empty pallet movement if they are assembled at the shipping location and baled when emptied.
Transportation is an essential component of carbon footprint analysis, and especially where it is very costly, such as air freight shipments, a paper pallet can be a winner. One major retailer, IKEA, uses millions of paper pallets annually in its unique, global supply chain. However, you need to take a broad view when evaluating carbon footprints and environmental claims. You need to examine the entire unit load to see how best to minimize total costs and impacts. For example, a small amount of product damage related to pallet performance could result in carbon emissions and total supply chain costs much greater than the savings produced by a lighter pallet. Also, a stronger pallet may require less total product packaging for the items being shipped. This may lead to lower sustainability costs in addition to cheaper unit loads.
In general, a focus on carbon reduction will help the competitive position of wood pallets, and the topic of carbon reduction has recently become a hot topic in the mainstream press. Let’s take a closer look at how pallet life cycle is related to carbon emissions.
Understanding Carbon Footprint & Pallets
Simply put, carbon footprint can be defined as the amount of net CO2 emissions resulting from the life cycle of a pallet from forest to grinder. That life cycle can include five stages, according to a 2014 study from the Forest Products Journal. It generalizes the carbon impact of wood pallets as follows:
• Raw material extraction and premanufacturing – The study suggests that 82% of carbon impacts are related to wood, and 18% to steel for pallets, on average.
• Manufacturing—Carbon emissions are most significant for heat treatment (72% on average for those treated) with assembly accounting for 35% for expendable, 28% for stringer and 21% for block, on a per trip basis. While durable, reusable pallets may require more energy to manufacture, the key point here is that that energy is lower on a cost per trip or pallet lifetime basis
• Transportation and use – As per the discussion of paper pallets above, the transportation impact of a pallet is directly related to tare weight and the transportation mode.
• Refurbishing – According to the study, greenhouse gas (GHG) emissions for stringer pallets are 47% for materials, 41% for transportation and 12% for equipment, while for block pallets, the comparable numbers are 28, 55 and 17%.
• End-of-life – Impacts range widely based on the dominant scenario of disposal.
Pallet Repair Generates Carbon Credits
A Virginia Tech study published in the Journal of Industrial Ecology (2017) found that pallet repair using reclaimed lumber can result in net carbon credits when transportation is left out of the equation. The researchers (Jonghun Park, Laszlo Horvath, and Robert J. Bush) looked at data from seven pallet repair operations related to 48 by 40-inch stringer pallet repair. The lumber used to repair pallets was almost all recovered (97%) from dismantled pallets. The carbon offsets created by using the reclaimed lumber were key to this outcome. These benefits outweighed the GHG emissions. Electricity to power repair equipment had the most substantial GHG impact. Steel nails used for repair had the most significant contribution to GHG emissions among materials.
While this research is a good news study for pallets, the authors stress that their study does not include transportation impacts. The researchers stated, “The transportation of used pallets can be the primary contributor to the GHG emissions of the wood pallet repair business. Optimized supply chain management, which can enhance transportation efficiency, could decrease the GHG emissions of the wood pallet repair business.”
The researchers also noted the importance of transportation and repair network management, standardized repair methods and strict material recovery management in helping improve the sustainability of wood pallet recycling.
Where to Look for Carbon Reduction
Based on the discussion above, it is evident that there are opportunities throughout the pallet lifecycle to reduce carbon emissions. The low hanging fruit will depend to a degree on the supply chain and the role of the participant in it. For example, pallet users can help by gentle handling, asset protection and timely return. Rough handling or pallet loss translates into more repair, earlier replacement and more carbon emissions.
In the past, the tendency was to paint in broad brush strokes about the carbon benefits of one pallet material versus another, or in comparing management approaches (rental, fungible, expendable, etc.). But this oversimplification has led people to cling together in various factions versus looking for broad consensus.
No one pallet design or management scheme fits every supply chain. Pallet providers need to work toward improving supply chain collaboration. Pallet users need to realize that how they handle pallets matters. And everyone needs to do their part to eliminate waste, improve reuse and reduce CO2 emission.
