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Industry Conference Accents Wood Containers, Packaging
Wooden containers usually are not the main attraction at a pallet industry meeting, but they were center stage at the Wood Container Technology Conference
By Rick LeBlanc
Date Posted: 10/1/2001
SEATTLE — Wooden containers usually are not the main attraction at a pallet industry meeting, but they were center stage at the Wood Container Technology Conference. The conference, co-sponsored by APA-The Engineered Wood Association and the American Wood
Packaging Association, drew about 80 people from companies around the country that make wood containers and packaging.
They gathered in Seattle in September to listen to experts talk about packaging design, logistics, marketing and regulatory issues. Topics ranged from certification requirements for wood packaging shipped to European Union countries to opportunities for marketing closed loop services, and more.
Day one of the conference was devoted to tours, and the first stop was the Boeing Spares Distribution Center. Boeing apparently has been phasing out tours of this 700,000-square-foot facility but agreed to open its doors to the conferees.
The Boeing distribution center runs seven days per week, 365 days per year. One thing immediately stood out as the tour began: there is a lot of wood packaging. Wood containers are used to store and ship about 40% of the spare Boeing aircraft parts from the facility to some 1,800 locations around the world. Some are very large, stretching up to 74 feet long. Virtually all of the spare parts are shipped by air.
Many large containers filled with parts are stored and stacked in a sizeable bulk storage area. Containers are designed for a six-trip life. Once replacement parts arrive at a destination, the used or damaged part is often returned in the same container.
Forty computer-assisted carousels on two levels facilitate efficient, accurate order picking of smaller parts. Totes filled with replacement parts move along about two miles of conveyors to packaging and shipping areas.
Boeing orders some parts to arrive already packaged in wood containers. For many others, Boeing’s crate yard fabricates wood packaging ‘on demand’ for incoming parts. The crate yard crew consists of about 21 workers on the day shift, another 15-18 on the second shift and seven on the third shift. They use about 845,000 square feet of plywood per year and about 422,000 board feet of lumber. The operations also require about 78 acres of polyethylene wrap and a lot of foam dunnage.
The crew may make up common box sizes in advance. The day of the tour, one employee was making a complicated box that requires an estimated 60 hours of labor. Unless it is urgently needed, the same worker builds the entire box instead of different employees over several shifts.
The next stop was the APA headquarters and research laboratory in Tacoma, where the group viewed some of the tests that APA conducts on plywood, oriented strand board (OSB), glued laminated timber (glulam), composite panels, wood I-joists and laminated veneer lumber. The tour group also met with APA executives, who hosted the visitors to lunch.
The final tour stop was a visit to Simpson Timber Company’s Olympic Plywood Division in Shelton. The impressive plant is dedicated to the production of high-quality overlay for a number of applications where finish is important. The plant produces about 98% of the panels used for roll-up truck doors in the U.S., 60% for the overlay concrete forming market, and nearly 50% for the overlay plywood sign market.
In opening remarks at the conference, the APA’s Mark Halverson emphasized that the future of wood packaging is brighter than ever before. He encouraged participants to network and explore partnering opportunities to bring more value to customers. The importance of networking and partnering was also stressed by Clyde Witt, executive editor of Material Handling Management magazine.
Clyde acknowledged that in the past he has often been accused of being anti-wood. "I try to be objective," he said. "I report what people tell me and what I see. It is as easy and as difficult as that."
Clyde believes that companies want greater flexibility in material handling systems. "They don’t know what their business will be in two years," he said, "but at the same time, they want consistency and predictability. Wood is a problem because it can splinter." In gravity-flow storage systems, he noted, wood splinters can jam a system.
Reusability is a function, not a material, Clyde observed. He also noted a trend of changes in ownership of reusable containers. In the automotive industry, manufacturers originally owned most of the containers — General Motors has invested $1.4 billion in reusable containers. Now, however, ownership is being pushed back down the supply chain to suppliers.
The advantages of plastic containers, Clyde noted, are lack of mechanical fasteners, resistance to moisture damage, ease of cleaning, and ability to insert rods to make them stiffer. On the other hand, the initial cost is high, some have problems with slippage, tool molds are expensive, and new designs may require long lead times.
Flammability of container materials is still an issue of interest. "It’s a burning issue and should heat up this year," Clyde said wryly. "The RPCC (Reusable Pallet and Container Coalition) has to sell the fire marshals that plastic is no worse than wood." Some plastics have a higher ‘flash point’ than wood, he pointed out. PVC, for example, has a higher flash point than any other material used in pallets; it will self-extinguish when direct flames are removed. One commercially available pallet made of PVC is the GeoPal, manufactured by PolyOne.
"There is room for your (wood) containers out there," Clyde concluded, but he said wood will be relegated to "a niche market, a specialty market. That’s how it is perceived. My perception is that reusable is definitely the way of the future."
John Clarke, director of the Virginia Tech Center for Unit Load Design, addressed the conference on the performance of competitive materials. Wood has had competition from alternative materials before, he noted. During World War I, about 80% of containers were made of wood and about 20%, corrugated. By World War II, the percentages were reversed. Now, about 90-95% of goods are shipped in corrugated.
John listed the desired characteristics of material for a typical container:
"Wood is a good balance," John said. "That’s why you still see a lot of it." After reviewing some of the strengths and weaknesses of metal, plastic and wood, John advised wood container manufacturers to seek out customers that have high-value or heavy products. Those with products handled in harsh environments may be good candidates for a wood container, he added.
John also suggested thinking about conversion from one-way to returnable applications. Wood has the fastest time to market relative to competing products, he noted.
John recommended that participants learn about the strengths and weaknesses of competing materials and use computer software for design and drawings. "Be flexible and innovative," he said, "and reduce bug concerns associated with wood."
Several container manufacturers attended the conference in order to learn more about the restrictions on softwood packaging used for shipments to European Union nations. David Lamb of the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service gave an update on the issue. When he opened up the session to questions, the audience responded with many. People sought clarification on the certification process, what materials need to be marked, and how much it would cost. Tom Searles of the American Lumber Standard Committee, who also discussed the issue, helped to field some questions, as did John Conway, technical director of National Wooden Pallet and Container Association.
One container manufacturer with several locations expressed concern that the certification process for heat treated lumber would cost his company over $50,000 annually. Representatives from two certification agencies suggested the process may take one to two weeks, but there would probably be a rush for certification by the European Union deadline, which was Oct. 1. "A lot of people are lining up right now," said a representative of the Pacific Lumber Inspection Bureau, "and stamp companies are also backed up."
Each certification agency determines its own fees. One charges a minimum fee that ranges from $275-600 per month. Another charges $300 for an initial audit and then an additional $750 for a monthly half-day inspection. Pass-through fees of 10 cents per thousand board feet of heat treated lumber are charged to lumber producers and 2.4 cents to secondary processors.
Some wood container manufacturers were resigned to the fact the new regulations would impact everyone, and some have already become certified.
A representative of one accrediting agency suggested that the better prepared a company is with respect to purchasing heat treated wood, managing it, and documenting its control and processes, the more quickly it would be granted certification.
The requirement for stamping heated treated lumber raised a lot of questions. Each piece of heat treated lumber must be stamped before sale. Remanufacturers in turn must stamp each piece prior to resale. Packaging manufacturers that use heat treated lumber must stamp each side of the pallet or container, but they are not required to stamp every piece of lumber.
A few people attending the conference planned to avoid the certification process by using hardwood material. The recommended label for non-coniferous (hardwood) lumber is NC-US; this stamp does not require certification.
In a session focusing on logistics, Pat Crosby of Nippon Express discussed his company’s shipping and warehousing practices. A veteran manager at the major Japanese logistics company, he suggested that Nippon and its major competitors could provide cost-effective return of wood containers from domestic or international applications.
Randy Brown of Ongweoweh Corp. also discussed container tracking and retrieval. Ongweoweh provides pallet management services for such companies such as Kodak, Alcoa, Minute Maid and Coca Cola. Some of its customers require huge volumes of 36x36 and 37x37 pallets. When one customer began switching to plastic, "We saw the writing on the wall," Randy said. "Being a $5 million account, we realized we needed to get involved. We supply inventory management, new pallets, retrieval and repair."
In order to provide pallet management services, Ongweoweh likes to work with customers that have an inventory of 25,000 pallets with a replacement value of at least $8.00 each. Applications may vary, however. The company markets its services to top management. "Corporate support has been very successful for us," Randy said.
Ongweoweh reported that it will retrieve pallets in quantities of 20 or more units from across North America for $2.50 each. Mark noted that for much more expensive containers, the required return quantities should be significantly lower. He encouraged container manufacturers to think about wood packaging as reusable wooden containers — RWCs.
Other sessions included an update on trends in marketing wood products, creating positive perceptions of forestry, and vibration design and testing of cushioned crate systems. The Reusable Pallet and Container Committee (RPCC) also provided a brief overview of its activities to promote plastic and wood products.
People who attended the conference seemed to agree that it was a worthwhile investment for container companies. It helped bring them up to speed on how to meet the EU requirements, changing market conditions and new technology. It was a job well done by APA and the American Wood Packaging Association.