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Pallet Industry Civil War Intensifies as Gloves Come Off Over Who is "Greenest"

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The brutal infighting among players in the $10 billion-plus pallet industry continues unabated.

This weekend's Wall Street Journal took the battle national, detailing the ongoing battle royale between wood and plastic pallet-makers -- and what we have here is not at all a gentleman's rivalry.

Evidently, the bad blood began over which is "greener." Those in the business of making pallets from wood say wood is more environmentally friendly. Those in the business of making pallets from plastic say the opposite.

The Journal writes:

The website, headed by LLC, claims to promote "straight talk about wood pallets," saying they are "laden with bacteria," "contribute to global warming," and "fuel powerful fires that shatter lives."

But the wood people fire back with their own salvo:

Plastic "breaks easier than wood when hit with a forklift and then [the pallets] end up in the Dumpster. Does that sound green to you?" asks [wood pallet manufacturer] Dominion Pallet Inc.

Far from finding any common ground whatsoever, the two sides are each blaming the other for starting the blood-feud:

"They are bullies," says Bruce Scholnick, president of the National Wooden Pallet & Container Association, in Alexandria, Va. "There is no question in my mind they started it."

The wood people "fired the first shot," counters Bob Moore, chief executive officer of Intelligent Global Pooling Systems. "What they've done to us—they are absolute corporate bullies," he says.

Things have gotten so bad, even outside observers won't touch the issue:

"Oh, it's quite heated—I would never say one is better or worse or cleaner than the other," says Matt Zielenski, an analyst at the Freedonia Group, a Cleveland research firm.

One can see why Zielenski hesitates to get involved, as emotions are really running hot:

Alas, the one bearing the real brunt in the pallet wars is the innocent pallet itself...which never asked for any of this to begin with.

"The tactics are bringing so much negative limelight to the poor pallet," says Ralph Rupert, director of the Center for Unit Load Design at Virginia Polytechnic Institute and State University.
POSITION:  No positions in stocks mentioned.