Meachers collaborates to reduce emissions

Meachers Global Logistics has become a member of The Solent Cluster, the first major decarbonisation initiative to substantially reduce CO2 emissions from industry, transport and households across the Solent and the south coast of England.

The Solent Cluster is a cross-sector collaboration of international organisations, including manufacturers and engineering companies, regional businesses and industries, leading logistics and infrastructure operators and academic institutions, with decades of proven expertise in carbon capture and storage and hydrogen technology.

Meachers, signed up as a member at the launch event alongside founding members the Solent Local Enterprise Partnership (LEP), global energy provider ExxonMobil and University of Southampton. Each shared details of their vision for the Solent and how it could secure existing jobs and produce low-carbon fuels for sectors including maritime and aviation, as well as providing energy to heat homes, businesses, and public buildings. This effort could position the Solent at the centre of low carbon fuel production in the UK and make a major contribution to the country’s Net Zero ambitions by 2050. The project could capture approximately three million metric tons of CO2 every year.

Gary Whittle, commercial director of Meachers Global Logistics, said: “We are delighted to show our support to The Solent Cluster by announcing our membership to this important partnership. We look forward to collaborating with fellow members to bring societal and environmental benefits to the Solent region and helping it become a major contributor to the UK’s Net Zero ambitions.”

Anne-Marie Mountifield, chief executive of Solent Local Enterprise Partnership, said: “Decarbonisation is at the heart of our economic strategy for the area and the creation of The Solent Cluster will sit alongside our ambition to pioneer approaches to climate change adaptation and decarbonization, linked to our coastal setting, and establishing real expertise which other regions – nationally and globally – can learn from. The Solent Cluster will provide a platform for the excellent work that is already taking place and the partnership has a unique opportunity to affect real change in energy production and consumption, establishing the Solent and wider region as a leading centre for low carbon investment now and in the future.”

“This is an important opportunity to decarbonise the Solent Region, and we are proud to be a part of this collaborative effort to significantly reduce CO2 emissions from multiple sectors,’’ said Dan Ammann, president of ExxonMobil Low Carbon Solutions. ‘We look forward to working with our founding members and others to develop a compelling project.”

The Solent Cluster could enable organisations to bid for government investment support for projects to decarbonize the Solent region and realise the benefits that can flow to the region’s businesses and communities.

Dr. Lindsay-Marie Armstrong, associate professor of mechanical engineering and academic cluster lead for the Solent Industrial Decarbonization Cluster at University of Southampton, said, “The Solent is recognised as one of the leading contributors of CO2 emissions with approximately 3.2 million metric tons of CO2 emissions released from energy-intensive manufacturing processes every year. To form a decarbonisation cluster that spans the public, private and higher education sectors is a monumental step forward for the region.

“It will introduce sustainable fuels for local transportation, the aviation and the shipping sectors; create low carbon energy to heat homes, businesses and public buildings; and open up new highly skilled jobs opportunities. This can only be achieved by working together as a community, covering all sectors and ultimately working with the same desire to achieve a low carbon economic future for the Solent region.”

Pressures remain despite material price drop

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.

According to some European industry indices, the costs of raw materials used to make packaging – pallet wood and steel (for nails) – fell during Q3/2022. However, the high cost of energy and fuel are pushing upward rates for logistics, and for heat treating and kiln drying timber. Meanwhile, 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 pushed the actual 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 in (129.7 index points), a rise of 5.4 points on quarter 2 and 19.6 points on the same period last year. In the spot market, rates grew to 142.6 points, an increase of 6.0 points on the previous quarter and 26.4 points year-on-year.

The report added that the cost of diesel usually accounts 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. Meanwhile, European Union agency Eurostat said that hourly labour costs rose by 4.0% 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 the European Federation of Wooden Pallet and Packaging Manufacturers (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.

Material price drop

“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.”

FEFPEB’s recent congress for members held in Florence, Italy, at the end of September, addressed the current challenges facing the sector. The event, titled ‘Wooden Pallets and Packaging in the Centre of the Sustainable Economy’, featured presentations and discussion on current crises, including tackling energy and shipping costs, building on the industry’s strong environmental credentials, and how to recruit and retain talented staff into the future.

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