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Pallet industry argues over regulations

by Tim Linden | October 04, 2009
Over the past month, at four different locations across the country, pallet industry representatives, as well as others, have been discussing proposals related to the regulation of wood packaging materials, including pallets that move in interstate commerce in the United States.

For several years, there has been an international standard requiring wood pallets and some other wood packaging materials to be heat treated or fumigated before use in an effort to control the transfer of wood-boring pests from one country to another. Noting that there is an international standard, Bruce Scholnick, president of the National Wooden Pallet & Container Association, said that the U.S. industry proactively began to look at similar regulations for interstate shipments, and that these hearings are a result of that effort.

"I want to make it clear the initiative to regulate solid wood packaging in the United States came from us," he said.

Mr. Scholnick said that nine years ago, the European Union established regulations that called for each wooden pallet to be heat treated or fumigated before it was put in commerce and permitted in to EU member countries and companies. The United States has followed suit and pallets coming into or going out of the country are regulated.

The regulations were designed to combat a real problem, Mr. Scholnick said. "There are many instances of non-native species coming into the United States from China or elsewhere that have started to establish themselves in the United States."

For example, he said the Emerald Ash Bore has established itself in a number of states, and as it does so it becomes a bigger problem and is more apt to be transported to another location where it has not established itself. The finding of this pest and others has led to U.S. Department of Agriculture quarantines from time to time.

While some manufacturers were against the industry initiative, the NWPCA president said, "We went to APHIS (the USDA's Animal & Plant Health Inspection Service) two-and-a-half years ago and said that dealing with these pests on a one-by-one basis with quarantines is not the best way to go. We know that there are 15 or 16 invasive species that are in the United States but have yet to reach that critical mass where they trigger a quarantine. Eventually it will happen."

Mr. Scholnick said that other host material, such as firewood and landscape lumber, are bigger problems than wooden pallets and containers "but we can't control that. All we can do is control our part."

Because of the efforts of the pallet and container association, Mr. Scholnick said the USDA issued an Advance Notice of Rulemaking recently and has been holding hearings across the country to establish what type of proposal, if any, is needed. The association recommends a phased-in program that basically adopts the international standard for all domestic shipments. Mr. Scholnick and his group proposes that every wooden pallet be treated when it is manufactured and again when it is repaired with new wood. The industry has estimated the cost of treatment at between 20 cents and 50 cents per pallet, depending upon the size of the pallet making operation.

Others do not think that regulation is sufficient. Jim Anderson, general counsel of IGPS Co. LLC, a three-year-old Orlando, FL, company that specializes in making plastic pallets and managing their use though a pooling process, argues that for both food-safety and pest-infestation issues it is time for the United States to replace its wood pallet stream with plastic pallets.

At the hearings, in press releases and in an interview with The Produce News, Mr. Anderson said that the USDA hearings point out that wooden pallets need to be replaced and plastic offers a cost-efficient and safe alternative.

He said that there "is clear and compelling evidence that, no matter how they are compared, IGPS plastic pallets outperform wood pallets in every measure - deforestation, pest infestation, bacteria transmission, ozone depletion and global warming. Wood pallets are an environmentally destructive, outmoded shipping and storage platform whose value has been outstripped by advances in plastic pallet technology."

The IGPS executive said the industry's proposal to adopt heat treatments or fumigation is not a simple solution and it needs to be well vetted. For example, he said the use of methyl bromide poses a very significant environmental problem, which should include an environmental impact report.

But by and large, Mr. Anderson's arguments revolve around the concept that IGPS believes a better and safer alternative is available and so that is the direction the industry should take. Plastic pallets, he said, offer a significant food-safety advantage as well as eliminate the problem with both deforestation and the spreading of invasive pests. "Our pallets are easily cleaned and put right back into circulation. They are uniform, non-porous, impervious to penetration, do not harbor bacteria and can be tracked and traced with an RFID tag."

Mr. Scholnick said that the arguments of the plastic pallet advocates such as Mr. Anderson are transparent. "They would like to see the wood pallet industry eliminated because they make plastic pallets."

He argued that plastic pallets can't take over the entire industry. "There are 1.2 billion pallets in circulation. If you were to convert all of them to plastic, you would have to use one month's worth of all the petroleum that there is."

In addition, he said the manufacturing of plastic pallets has its own environmental concerns. Plastic pallets are made with high-density polyethylene, which he said is flammable, and decabromide, which he called a very dangerous material.

Wood pallets, on the other hand, are "cost effective and environmentally safe. There is no reason to eliminate wood pallets," he said.

On the food-safety issue, the NWPCA president said that there have been a number of studies, particularly one in Germany, that shows that wood pallets perform "no worse and in some cases better than plastic pallets" when it comes to transmission of pathogens.

Mr. Scholnick said that the USDA hearings are in their preliminary stages but noted that the association hopes that regulations can be written quickly and enacted within six months. In his estimation, there is no danger that wooden pallets will be totally eliminated from use as he does not believe plastic pallets can fill the void. He said however that whatever regulations will be written, they will also apply to wooden bins in the field so the produce industry might want to get involved in the debate. "The produce industry isn't very vocal on this issue. It might want to be. But on the other hand wood packaging material is not going to go away. We are involved so maybe you don't have to be."