Yellow Pallet – Using Banana Stems to Produce Sustainable Transport Pallets

Context of Transport Climate Action

95% of the one billion pallets used annually for the transport of goods are made of wood. In the tropical fruit sector this is 99%, and over 95% of these pallets are only used one-way. In the majority of cases they are not re-used and end up being thrown away or incinerated.

Wood is scarce in the tropics. It often requires the transport of logs from several hundreds of kilometers away. In Latin America this may mean transporting wood from the higher altitudes of the Andes mountains to the location of the pallet production companies or can involve thousands of shipping kilometers e.g. from Chile. The same holds for obtaining wood in the Philippines or other tropical regions. If non-wood agricultural fibers can be used to produce pallets or parts of pallets such as the pallet blocks, substantial savings in carbon emissions can be achieved.

Yellow Pallets B.V. is a dutch company that provides the technology to use banana fiber from waste or from purpose grown banana stems for the production of pallets. This is considered as sustainable solution as banana stems provide four time more dry fiber than wood so this is a more sustainable solution for the pallets.

Description

Yellow Pallet B.V., a Dutch limited company, has developed the technology with the goal to sell factories, supplies and services to produce transport pallets from banana stems. The technology can be applied in 100 tropical countries and the global market for pallets is estimated to be US$10 billion/year.

Market opportunity and value proposition, Pallet wood is scarce in the tropics and the need for sustainable alternatives is high. On the other hand banana fiber is available in abundance and is a logical and sustainable choice for the production of pallets and pallet-blocks. Yellow Pallet has the technology to make this happen and transport pallets made of banana fiber bring many benefits: such as reducing production costs by 30%, reducing carbon emissions by 22%, increasing income opportunities for small farmers and the creation of many jobs in tropical countries.

Implementation

Although pallets made from banana fiber can be used for many purposes,

the first market focus is the pallet market for the export of banana, melon and pineapples from the key 5 exporting countries: Costa Rica, Ecuador, Colombia, Philippines and Guatemala. Sixteen million pallets are exported annually from these countries by five key players: Chiquita, Dole, Fyffes, Del Monte and Noboa. Yellow Pallet is in contact with these corporations for buying pallets and for the supply of banana stems.

As all pallets are made from a combination of blocks and pallets, initially the pallets will be made of banana blocks and wooden planks. This replaces 30% of the wood by banana fiber. Currently, Yellow Pallet applies exclusively the proven pallet-block production technology of IMAL PAL an Italian company that has over 40 years in experience in wood pressing with commercially available resins.

For production process please view the 2-minute youtube video: http://www.youtube.com/watch?v=_O_jFedQ5Ug&feature=youtu.be)

In the next phase, Yellow Pallet is developing a new technology that will deliver a 100% banana fiber pallet. It expects this100% banana fiber pallet technology to be available in 2017.

The first factory in Costa Rica will be constructed in a joint venture between Yellow Pallet and local pallet supplier Corporation Tara. It is expected that Yellow Pallet as a key investor will exit from this partnership before the end of the 6th year of operations. It has the exclusivity for Yellow Pallet’s technology in Costa Rica. The total market for new pallets Costa Rica is 5,5 million pallets/year of which 60% are block pallets. It is expected that the factory will produce 1,7 million pallets/year.

Benefits

The harvesting and transport of wood and the production of a wooden pallet results in a footprint of 5,34 kg CO2 per wooden pallet. As one billion pallets are used annually this is a significant amount of CO2. The banana pallet carbon footprint is 22% less, and is estimated to be only 4.13 kg CO2 per pallet. By locating the pallet production factory next to the plantation, the difference in absolute terms are increased by respectively 13.09 kg CO2 and 10.21 kg CO2. The calculations have been made by the dutch company Royalhaskoning DHV on the basis of the situation in Colombia. The situation in Costa Rica is even more carbon intensive as more wood for the pallets comes from Chile (and therefore results in extra CO2 emissions for its transport).

Initial discussions have started with market leader Southe Pole (http://www.Southpolecarbon.com) to claim these assets on a no-cure-no pay basis[1] and sell the credits to the private market. The reduced carbon emissions can help to convince retailers to order bananas (and other tropical fruit) to be transported on banana pallets. If this was the case for the +/- 20 million pallets used for banana export in Colombia, the savings could amount to 57,600 tonnes CO2 /year.

These carbon advantages can encourage retailers and wholesalers to specify the banana pallet for all their tropical fruit transport.

Banana stems for the production of pallets under the Yellow Pallet business model will be purchased from both large and small growers. To manage purchase prices, Yellow Pallet intends to harvest banana stems from a dedicated banana-plantations that produces 4 times more, dry fiber/hectare/year compared to a Melina or Pine wood plantation that is usually used for pallet production. Bananas grow quicker than most trees used for wooden pallets, which makes this technology important.

[1] No cure no pay is a form of salvage contract in which the salvor receives no payment if s/he fails to save any property. In this respect South Pole assumes the risk of preparing for sale and the selling the credits on the market.

Potential for scaling up

As 21 million pallets are used every year for the export of only bananas, pineapples and melons from Costa Rica, Colombia, Ecuador, the Philippines and Guatemala there is high potential for scaling up. Yellow Pallet’s technology can be further applied in 100 tropical countries (i.e. Brazil, China, India, Indonesia).

Yellow Pallet has the ambition to build 15+ factories in 10 years globally and expects to realize two pallet factories per year from 2018 onwards. The installed base for revenues from services and supplies will grow in this way. Besides the relationships with key customers in the top-5 fruit-exporting countries, Yellow Pallet already is in discussions with contacts in India, Brazil and China to conduct feasibility studies with a view to building more factories.

Selected references

http://www.yellow-pallet.com

http://www.climate-kic.org/case-studies/fruit-transport-going-bananas/

PROJECT INFORMATION

Location:

Costa Rica, Ecuador, Colombia, the Philippines and Guatemala.

Start:

2012

Finish:

On-going

Tags:

Global, Mitigation, Freight, Trucks, shipping, Technology

Organizer/s:

Yellow Pallet B.V, Wageningen Tarimas de fibras Agricola limitada, Siquirres, Costa Rica.

Contact/s:

Hein van Opstal, +31653571196 h.v.opstal@yellow-pallet.com

‘Wholesalers and retailers like Tesco and Ahold benefit from using more sustainable pallets’
-Hein van Opstal