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The Logistics Trend Radar 7.0 - Insights. Shaping Tomorrow

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Impact:
Low
Adoption:
5 - 10 Years
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Unsustainable growth: Projected increase in plastics and plastic leakage by 2040

Source: Organization for Exonomic Co-operation and Development (OECD) (2023): Towards Eliminating Plastic Pollution by 2040 A Policy Scenario Analysis

Relevance to the Future of Logistics

Building & Construction Material

The building and construction sector is the largest contributor to greenhouse gas emissions, responsible for an astonishing 37% of energy-related carbon emissions. This substantial carbon footprint is primarily attributed to the production and utilization of materials such as cement, steel, and aluminum, which have a significant environmental impact.

Since logistics organizations use hundreds of thousands of facilities, warehouses, and offices made from these materials, this represents a great opportunity to reduce the environmental footprint of the supply chain. Switching to bio-based building materials wherever feasible can help meet sustainability goals, and already many tech providers recognize this potential.

Mycelium, derived from fungi, presents a compelling opportunity as a sustainable construction material. A good example of its application in construction is Ecovative's MycoComposite™ hemp blend. This innovative solution boasts strength, water resistance, mold resistance, fire resistance, and other qualities. The material's inherent flame-retardant properties ensure heightened safety, while its insulation and noise-dampening benefits enhance environmental comfort.

Solutions like these can help lower the carbon footprint of the building and construction industry, offering logistics providers alternatives when planning the construction of greenfield projects. By utilizing bio-based materials, logistics organizations are empowered to reduce emissions from building construction.

When we decided to build the new European DHL Innovation Center, sustainability was a high priority; amongst other measures locally sourced timber and green technologies are being used for climate neutrality.

Logistics Operations Assets

As the megatrends of global trade and e-commerce expand in future, the number of warehouses will grow exponentially along with associated assets such as pallets, racks, and picking bins.

Today, the vast majority of pallets are wooden and mostly bio-based, but they break relatively easily compared with fully metal or plastic counterparts. Instead of replacing them with these less sustainable alternatives or with increasingly expensive wood and nails, logistics organizations are steadily searching for more durable and reusable bio-based materials.

Companies like Origo in Malaysia are developing bio-based alternatives for logistics assets and packaging. Origo utilizes agricultural waste from palm fibers or rice husks to produce pallets that are fully recyclable and compostable. The challenge lies in ensuring these bio-based solutions have comparable longevity to traditional wooden pallets and can be a sustainable and viable alternative.

Further testing and scaling are needed to determine the resilience of these alternative solutions.

By using bio-based materials for assets in logistics facilities, organizations can achieve greater sustainability while also reducing replacement costs.

Packaging & Packing Materials

The most visible waste outputs from supply chains are packaging and packing materials -mostly plastic-, with less than 9% of plastic products recycled globally in 2022. Bags, wraps, cardboard, and styrofoam are contaminating natural environments around the world and pressure is growing to address this, compelling the logistics industry to seek biodegradable alternatives.

However, not all biodegradable products come from renewable sources, and several companies, around the world are seeking to bridge this gap.

Due to the demand for completely bio-based solutions, a growing number of startups are developing solutions in a wide variety of areas. The Australian company Planet Protector produces insulated wool-based packaging solutions as an alternative to polystyrene packaging materials.

Furthermore, materials like algae, mushrooms, and bamboo are also gaining popularity as viable options for sustainable packaging. These bio-based materials offer promising alternatives to traditional plastic packaging and contribute to a more environmentally friendly approach in the industry.

By adopting packaging and packing material that are both biodegradable and bio-based, logistics and supply chain organizations can better ensure they are tackling the sustainability challenge for the entire product lifespan, not just downstream.

Challenges

Challenge 1

Bio-based material production is still relatively small and there may be supply challenges if such materials are adopted on a large scale.

Challenge 2

Most bio-based solutions are pricier than less sustainable alternatives, limiting adoption.

Challenge 3

While still a worthy step towards achieving sustainability goals, bio-based materials are not always biodegradable and may still contribute to waste.

Challenge 4

Bio-based alternatives to logistics assets and packaging are more sustainable but often have limitations in terms of durability or stability compared to plastic-based alternatives.

Bio-based material production is still relatively small and there may be supply challenges if such materials are adopted on a large scale.
Most bio-based solutions are pricier than less sustainable alternatives, limiting adoption.
While still a worthy step towards achieving sustainability goals, bio-based materials are not always biodegradable and may still contribute to waste.
Bio-based alternatives to logistics assets and packaging are more sustainable but often have limitations in terms of durability or stability compared to plastic-based alternatives.

Outlook

Bio-based materials continue to provide valuable alternative solutions for logistics and supply chain operations. However, it is important to note that many of these solutions are still in the developmental phase, and finding completely bio-degradable and environmentally friendly alternatives with properties comparable to conventional solutions remains a rarity.

This trend should be monitored TO SOME EXTENT,with developments and use cases on the horizon.

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Sources

  1. McKinsey (2023): Sustainability in packaging 2023: Inside the minds of global consumers
  2. United Nations Environment Programme (2023): Building Materials and the Climate: Constructing a New Future
  3. 3. Source Plastics Europe (2023): Plastic – the fast Facts 2023