Saturday 25 July 2020

The wrong kind of pallets

Something caught my eye on Chris Grey's excellent blog yesterday about wooden pallets and compliance with ISPM15 (International Standards for Phytosanitary Measures) - which requires heat treatment to eradicate bark beetle and fungal infestations and stencil marking to show compliance. I have had a link on this blog since March 2019 to the Irish border blog where this was pointed out.  Apperently, the head of the Timber and Pallet Confederation has written to DEFRA warning that Britain won't have enough pallets to comply with the rule by the end of January.

This is according to a report on Bloomberg: The Wrong Kind of Pallets Threatens Border Trouble After Brexit.

In a letter to the Department for Environment, Food and Rural Affairs last month, the head of the U.K.’s Timber Packaging and Pallet Confederation warned that Britain won’t have enough that comply with the rule -- and the coronavirus has hampered efforts to plug the shortfall.

“It is even more unlikely the 1st January, 2021 compliance date will be met,” John Dye, the lobby group’s president, wrote in the June 7 letter. “There has been a lot of progress made by our pragmatic industry, but there is still a lot more to come along.”

According to John Dye at the Confederation, up to 100 million pallets move between the U.K. and EU each year. Up to now, they haven’t needed to comply with ISPM-15 because movements between EU member states are exempt -- something that ends on Dec. 31.  Bloomberg say:

Pallet makers in both the U.K. and EU have been trying to ramp up production, but their efforts have been hit by the pandemic, Dye said. Installations of new kilns to heat-treat pallets were badly delayed by the virus.".

The 206-page Border Operating Model (page 47) says "Wood packaging material (WPM), including pallets and crates, must meet the ISPM15 international standards for treatment and compliant marking."  This is for pallets coming IN to  the UK.

Dye, who is also a director at Scott Pallets, said he hopes the EU won’t enforce the rule strictly because the bloc, too, has a shortage of compliant pallets. But he still tells customers that they can’t be certain the EU will go easy on the U.K.  “They might be stopped,” he said of the pallets. “It’s quite frustrating when politicians are playing with people’s businesses.”

This plays in to two other narratives. First, on David Smith's blog (he is economics editor at The Sunday Times) where he talks about the distinction between business spending and productive business investment. Investing in heat treating pallets is not productive in that it gives no return, it simply allows the status quo to continue. Installing new kilns is not cheap I imagine to install or to run but it must be done to allow trade with the EU to carry on.

When you put this alongside all the wasted spending that cash-strapped businesses are involved in with coronavirus and Brexit it is not hard to see a backlash coming next year with a drop in output as reduced investment in productive things suffers.

Next, Jennifer Rankin at The Guardian has a long thread about the 1032 page Change or Go paper produced by Matthew Elliot at Business for Britain (what a lie eh?) in 2015. I have blogged about this in the past and what a fantasy it all was. One of the things she remarks about is the single reference to Ireland, which is also a feature of Dr North's Flexcit. The biggest stumbling block was and still is the Irish border issue which nobody on the leave side even recognised as a problem.

But she might also have mentioned the pallet problem as well. This is just one of the thousands of small issues that men like Elliot and North were totally ignorant about and never bothered to research or address.

When the history of Brexit comes to be written let us hope these people get their comeuppance.

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