Pallets: The future of RFID for pallet tracking and other unanswered questions

There were a number of questions following Modern’s recent pallet webcast “Results of the 2010 Pallet Usage and Trending Study.” Earlier this week, we caught up with Marshall White, president of the consulting firm White and Co. [url=http://www.whiteandcompany.net]http://www.whiteandcompany.net[/url] and our pallet expert, to answer some of your unanswered questions.

What is the RFID future for pallet tracking and are there any tracking systems in place either at Wal-Mart or other companies?

White: I’m unaware of the widespread use of RFID to track the pallet itself, at least the way it was originally conceived by Wal-Mart. iGPS, the plastic pallet pooling provider, has a system in place to track their pallets, but I don’t know how they are using it. I think RFID technology makes sense if you want to track a pallet to facilitate reuse in a closed loop supply chain. I’m not an advocate of using the RFID on the pallet to track what’s on top of the pallet in an open loop supply chain, which is how this was originally conceived. One of my colleagues once said that putting an RFID tag on a pallet is like putting a license plate on a car in a demotion derby: There are probably better ways to track a carton than to put an antenna on a pallet that is subject to damage pretty easily. It makes more sense to track the carton.

Do you feel there is merit to the recall of certain pharmaceuticals based on the moldy smell that is blamed on materials used for pallet fumigation?

White: In this case, I don’t know because I have not seen the science. However, some years ago, I worked on a case where consumers of bananas were complaining about a musty odor in the banana. I was asked to help determine the source of the odor, and it turned out to be wood that had been processed in South America that had been inadvertently contaminated with a chemical. It was not the same chemical that is supposedly involved in the pharmaceutical industry examples, but it had a similar odor. As soon as that lumber was eliminated from the supply chain, it went away. My point is: It can happen. It’s also possible that it resulted from other sources of packaging in the supply chain. There is research out of Australia, for instance, that shows that the odor is a byproduct of the paper that’s used in some paper-based packaging. Again, I just haven’t seen the science.

Do you have any advice to end users who are concerned about this issue?

White: iGPS says that it is coming out with a plastic bio pallet. I think that is potentially interesting. I also think the wood industry has an opportunity to define a pharmaceutical grade pallet. It’s one that would be mold free, probably a dry pallet of some sort, and one where the chain of custody would establish that there hasn’t been any chemical added and that the moisture content is monitored to prevent the development of mold. I think that’s a business opportunity.

Can you tell us what is the lifespan of the typical pallet and what percentage are remanufactured annually?

White: There is no typical lifespan to a wooden pallet because there are so many different designs and they’re used in so many different ways. I can tell you that the USDA Forest Service monitors wood pallet production. In 1995, they estimated that 411 million new wood pallets were produced along with 143 million used pallets. By 2006, they estimated that 441 million new wood pallets were produced and that there were 321 million used pallets. That’s a huge growth in the number of used pallets. Unfortunately, we don’t have a government agency out there collecting this information on other pallets. However, the June 2008 Freedonia Industrial report estimated the demand for wood pallets in 1997 was 1.112 billion pallets and that it was 1.105 billion pallets in 2007. At the same time, the demand for plastic pallets was 85 million in 1997 and was 117 million in 2007. Now, they are estimating the demand for wood pallets to grow to 1.160 billion by 2012 and demand for plastic pallets to grow to 132 million.

Pallet survey: What moves our readers
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From wood to plastic to pallet pools, our readers tell us what’s important in pallets.