CHEP expands its forestry portfolio in SA

April 1, 2021

CHEP, one of the world’s leading sustainable logistics businesses, has expanded its forestry portfolio in South Africa to 18 pine timber farms, effectively doubling its interests in timber farms in the country.

“We’re really excited by our new acquisitions,” said CHEP Forestry Senior Director Jed Krige. “It’s another step towards building an independent, sustainable and regenerative supply chain. We are getting to a point where we will be putting more timber resources into the world than we take out.”

The CHEP forestry holdings in South Africa now cover an area in excess of 7 500ha of standing pine farms. Most of the existing CHEP Sub Saharan Africa (SSA) forests carry the Forestry Stewardship Council (FSC) accreditation, while the latest new forest acquisitions are currently being upgraded in compliance with the international FSC standards.

The CHEP SSA farms are all located in the Bulwer / Underberg district and are within 90 kms of CHEP’s Weatherboard Sawmill. They are managed by Forestry Manager Gordon McKenzie and a team of experienced foresters.

CHEP’s unique pooling system epitomises the circular economy, with CHEP pallets being shared and reused (not sold) by clients in FMCG, Original Equipment Manufacturers and agricultural supply chains.

Today, CHEP’s humble pine pallet underpins many of the world’s supply chains. Third-party Life Cycle Analysis has shown that CHEP pallets use 3,5 times less wood, generate 2,5 times less waste, and emit 2,3 times less CO2, compared with the main market alternative.

“The timber backward integration strategy in South Africa was initiated in 2006. It was as a result of ongoing shortages of industrial grade timber to be used in the local pallet market. The strategy was to secure standing sustainable timber farms for supply to sawmills. The sawmills would then produce pallet repair timber to the exact CHEP dimensions, maximizing timber yield. We are now in a position, with our farms, to supply our own sawmill (on 22-year rotation) for up to 60% of CHEP SSA’s current annual requirements”, said Krige.

Ownership of its own sustainable pine timber farms has therefore mitigated against market shortages and largely mitigated against the risk of non-supply or inconsistent supply of locally provided timber. It has also removed the need to import timber, which is time-consuming, expensive and environmentally unsustainable.

Another noteworthy contribution from CHEP owned farms is the effect it has on surrounding communities. Employment opportunities are created for the locals on the CHEP farms as well as the opportunity to harvest reeds on the farms for the manufacture of reed mats. Alien timber is also supplied to the surrounding communities to be used as firewood.

“Ultimately, we want to restore, replenish and create more value for society and the environment than the business takes out,” said Krige. “As a pioneer in the circular economy, and with the support of our stakeholders, we are well positioned to succeed.”

CHEP is a division of the international Brambles Group.

Related article: How the humble pallet became indispensable to the global supply chain

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Frans Morwe
3 years ago

It's great business strategy contributing to the economic growth of SA economy

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