Tag Archive for: supply chain
The National Wooden Pallet & Container Association (NWPCA) Secures Major Win for Wooden Pallet Manufacturers in New EU Packaging Regulation
March 26, 2024 – NWPCA today announced a significant victory for wooden pallet manufacturers worldwide following the finalization of the European Union’s (EU) Packaging and Packaging Waste Regulation (PPWR). NWPCA’s successful advocacy efforts secured an exemption from the regulation’s reuse requirements for wooden pallets entering and leaving the EU under load.
The PPWR aims to tackle the pressing issue of packaging waste by introducing rules for all packaging placed on the EU market. Key objectives of the regulation include reducing packaging waste through recycling and reuse initiatives. As wood is a natural and fully recyclable material, NWPCA fully supported the PPWR’s aims to reduce waste and promote recycling. However, concerns arose regarding the prioritization of reusability over recyclability and the interpretation and implementation of the pallet reuse requirements, which posed a significant challenge to manufacturers and stakeholders.
Recognizing the potential impact on the wooden pallet industry and its users, the NWPCA engaged extensively with EU decision-makers, including the European Commission, the European Parliament, and member states in the Council of the EU. NWPCA explained the logistical issues with managing a reuse system of imported pallets and advocated for a targeted exemption to alleviate these burdensome requirements for wooden pallets entering and leaving the EU under load. Through consistent communication and collaboration with key stakeholders, NWPCA actively built support for this critical exemption.
Jason Ortega, Vice President of Public Affairs at NWPCA, stated, “This exemption is a clear win for wooden pallet manufacturers globally. Any company shipping goods into or out of the EU on a pallet will be exempt from challenging and costly reuse requirements. Wood pallets are made from a natural, renewable resource, and billions of them serve as the backbone of the supply chain. We know that in the United States, they are recovered and recycled 95% of the time, more than any other packaging product. We do not contribute to the growing global landfill problem. Our successful engagement on this issue minimizes supply chain disruptions and safeguards the pallet industry’s vitality.”
NWPCA’s success in securing the inclusion of the “within the territory of the Union” language in the final negotiated text is a testament to the organization’s steadfast dedication and collaborative approach. NWPCA acknowledges the invaluable support of its partners, including the international membership of the Global Wood Packaging Forum, the Canadian Wood Pallet and Container Association, the UK Timber Packaging and Pallet Confederation, and allies in the Canadian and United States governments, whose collective efforts helped raise awareness and advocate for the exemption.
The final adoption of the negotiated text by each branch of the EU institutions is anticipated to proceed smoothly, paving the way for the regulation’s implementation phase. NWPCA remains committed to supporting sustainable solutions within the transport packaging sector and celebrates this milestone achievement as a testament to the power of collaboration and advocacy.
Contact
Jason Ortega, JD/MBA
Vice President, Public Affairs
703.519.6104
Email
Wooden pallet & packaging body warns supply chain cost pressures remain
Supply chains across Europe have been warned that remaining high prices of inputs other than raw materials are expected to keep costs of essential products such as pallets and packaging high for the foreseeable future.
The European Federation of Wooden Pallet & Packaging Manufacturers (FEFPEB) said according to some European industry indices, the costs of raw materials used to make packaging – pallet wood and steel (for nails) – fell during quarter 3 2022.
But high cost of energy and fuel are pushing upward rates for logistics, and for heat treating and kiln drying timber.
And other higher-priced inputs, including labour, are now making up a considerably larger proportion of the price of goods such as pallets and packaging than they were previously.
This has all pushed the price of these items up significantly.
According to the European Road Freight Rates Benchmark Report, produced by Transport Intelligence, Upply and IRU, in Q3 2022, average European road freight contract prices reached an all-time high, and while the cost of diesel would usually account for one third of total operating transport costs – but may now account for 50% of costs.
Market and consumer data company Statista says the average monthly OPEC basket crude oil price rose from US$85.41 in January 2022 to $117.72 in June 2022.
European Union agency Eurostat said that hourly labour costs rose by 4% in the Euro area in the second quarter of the year and 4.4% compared with the same quarter the previous year.
Increased costs of inputs such as these are impacting on manufacturing businesses of all kinds around Europe, including the pallet and packaging sector.
Fons Ceelaert, Secretary General of FEFPEB, said: “Having reached all-time highs, raw material costs have eased slightly in recent months. However, national associations across Europe are reporting that ongoing highs in the cost of energy, transport and labour are still impacting heavily on the prices paid by manufacturers and repairers.
“Pallet and packaging businesses across Europe are working closely with their customers to minimise the impact of these continuing pressures. In the meantime, FEFPEB will continue to monitor this situation and keep the market informed about the latest developments.”
The Supply Chain’s Unsung Hero: The Wooden Pallet
The impact that wooden pallets and containers have on the supply chain as an important and sustainable stakeholder, especially how it impacts up the chain of supply and demand for the industry’s customer base, is a message that cuts across the cluttered decision making process that companies are faced with when choosing their distribution packaging.
Pallet Manufacturing is an “Essential Service” and “Critical Infrastructure” for Supply Chain Continuity and COVID-19 Recovery Efforts
Statement from the Global Wood Packaging Forum
As our global leaders across the world put in place emergency measures to protect the world’s population from the spread of COVID-19, we respectfully urge that policies being developed and implemented safeguard the ability of essential businesses to continue operations. We need to avoid an inadvertent mistake that has a global negative impact.
Wooden pallets and containers are essential services and critical infrastructure. We are the ‘blood cells’ of the body of the world; moving food, medical supplies, pharmaceuticals, chemistry, beverages, and essential paper products. There are 2 billion pallets in circulation in the United States alone and over 4 billion in Europe. Businesses that manufacture, repair wooden pallets, offer pallet pooling services, and provide wood containers and wood packaging that are essential to maintaining critical operations and the flow of commerce. Community members providing critical care, and services should be assured they will receive their shipments in a timely manner and in good condition. This will be crucial beyond the current crisis, when we turn to recovering from this pandemic.
We are appealing to all Governments to support pallet and packaging manufacturers, pallet pools, reconditioned pallet businesses, and the logistics industry; and also ensure that global sawmilling and material support operations are able to continue providing timber and essential equipment and supplies to our operations. Many pallet manufacturing businesses affected are family owned and support their local economy. The industry does this through purchases of lumber, nails, machinery, and related goods. Most importantly, wooden pallets and containers are a critical piece of global supply chain logistics, as no other ‘essential’ goods make it through the supply chain without pallets.
This is an unprecedented situation and we will be working with the industry and with the Government to ensure these businesses can carry on operating to ensure continuity of supply of these essential products.
About:
The Global Wood Packaging Forum is a collaboration of associated wood packaging organizations and representatives from around the world that meets to discuss global issues that affect the industry.