We Started Separating Steel Pallet Bases. Here Is the Arithmetic.
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Clean separated galvanised steel sells at a materially better price than mixed scrap. At 32 lb per unit across a scrap-routed stream of several thousand units a year, separating pallet bases paid for the handling in under eight months.
This is a small story about a dull improvement, and the reason it is worth writing down is that we nearly did not make it. For about six years our scrap-routed units went out as one stream: cages, pallet bases and strapping, baled together, sold as mixed.
It was simpler. It was also leaving money and tonnage on the floor.
What a scrapped unit contains
| Component | Weight | Stream |
|---|---|---|
| HDPE bottle | ≈38 lb | Granulate, flake wash, pelletise |
| Galvanised cage | ≈48 lb | Baled steel |
| Steel pallet base | ≈32 lb | Baled steel |
| Timber pallet base (alternative) | ≈24 lb | Ground for mulch and fuel |
| Valve and gasket | ≈0.4 lb | No outlet — stockpiled |
| Total recovered | ≈118 lb |
The bottle stream was already clean and separate, because regrind quality depends entirely on not contaminating the resin. That part we had always done properly.
The steel was the lazy part. Cages and pallet bases went into the same bale, along with whatever strapping and fasteners came off with them.
Why that costs you
Scrap pricing is about consistency and contamination. A bale of clean, known, single-type galvanised tube and sheet commands a better price than a bale of assorted steel with plastic deck fragments, fasteners and strapping mixed in — the buyer has to allow for sorting losses and does so in the price.
We were being paid for the worst thing in the bale. Composite pallet bases were the specific problem: a steel frame with a plastic deck, thrown in whole, which downgraded the entire load.
What we changed
Three things, none of them clever.
- A dedicated bay and bin for pallet bases, adjacent to the disassembly station rather than across the yard. Proximity is most of why it gets done.
- A rule at disassembly: composite bases get split — steel frame to the steel bin, plastic deck to the regrind stream. About forty seconds a unit with an impact driver.
- Strapping and fasteners into a third bin, baled separately and sold as mixed. Low value, but it stops them contaminating the good bale.
The arithmetic
Our scrap-routed stream runs a few thousand units a year — 7% of intake, and falling, which is the goal. At 32 lb of pallet-base steel per unit that is a meaningful tonnage sitting in the wrong bale.
The capital was almost nothing: two bins, some concrete work for the bay, an impact driver and a short written procedure. The operating cost is forty seconds per scrapped unit, which across the stream is a fraction of one person's week.
Payback on the capital came in under eight months, entirely from the price differential between clean separated galvanised and mixed. It also lifted our reported recovery tonnage, because material that had been going out as a downgraded mixed bale now goes out identified.
The part that surprised us
Separating bases made us better at not scrapping them.
Once pallet bases had their own bay, graders started walking over to it looking for replacements. A sound reclaimed steel base is $28 of material and frequently the only thing standing between a technical-grade unit and a Grade A one — a cracked composite deck is a disqualifier, and swapping it is twenty minutes.
We had been scrapping good bases and separately struggling to find replacements, because the good ones were inside a bale. That is an embarrassing sentence to write and it is exactly the kind of thing that only becomes visible when you stop mixing streams.
The general lesson
Every environmental improvement this company has made started as somebody noticing that a disposal or downgrade line item was larger than the value of the same material handled properly. Not one of them started as an environmental initiative.
We find that reassuring rather than cynical. A reuse operation where the ecology and the arithmetic point in different directions would be fragile; one where they point the same way survives a bad year.
692 words · published 25 June 2024 by Marguerite Okonkwo, Operations lead at IBC Tote Market LLC. We correct posts rather than quietly deleting them; if something here is wrong, tell us and we will say what changed.