Date: Friday, April 2, 2004

Re:	NEW LEGISLATION FOR TREATMENT OF WOOD PACKING MATERIAL

Dear NASA Member:

Following is a summary of the new legislation regarding the treatment of wood packing materials. We urge all of you to share this with your suppliers in order to ensure compliance by the proposed implementation dates listed.

Many have asked us about the implementation schedules of other countries. A list of the latest implementation dates for our trading partners follows below.

International Wood Packing Material Standard

The United States has entered into an international agreement on import requirements for Wood Packing Materials (WPM) - both hardwood and softwood - used in international trade. The objective of the participating governments was to develop a uniform standard to control pests in wood packaging material used in global trade. This standard itself is non-binding, thus it is up to the countries which sign onto the Agreement to pass legislation implementing the requirements set forth in the standard. Each country is moving at its own pace, a fact which makes it difficult to provide a firm implementation date for U.S. exporters. According to the U.S. Department of Agriculture, the United States will begin enforcing the international standard in July 2004 for all imports.

What is required? Under the new international standard ("ISPM 15"), all wood packing material must be heat treated or fumigated in accordance with the standard. Once treated the materials must display a specified mark developed by the International Standards Committee, which has been trademarked for this purpose. This mark is proof that the materials have indeed been treated in accordance with the standard. No further certification is required to assure compliance.

What is covered? The standard applies to all unprocessed wood or wood products (excluding paper products) used in supporting, protecting or carrying a commodity. This includes pallets, dunnage, crating, packing blocks, drums, cases, load boards, pallet collars, and skids. Please note that it applies to all wood packing material - not just softwood.

Effective Date -- Imports. We understand from USDA that the U.S. will begin enforcing the new standard for imports in June 2004 - the exact date has yet to be announced. To prepare importers for enforcement, USDA will begin issuing administrative non-compliance notices to importers in April and May of 2004. These notices are merely advisory, carry no penalties, and are intended to alert importers that the wood packing materials used are not in compliance with the new requirements. USDA is hoping such notices will give importers sufficient time to get in compliance with the new standards by the enforcement deadline.

Effective Date - Exports. See attached chart of latest implementation dates. Compliance for outbound shipments is mandated by the implementation dates of our many trading partners. The bottom line is that implementation for U.S. exports will be piecemeal, based on the actions of individual trading partners.

We hope you find the following information useful and feel free to contact us with any questions.

Best Regards,
The North American Shippers Association

Judy Mannix
Administrator

IMPLEMENTATION DATES OF THE WOOD PACKING STANDARD ("ISPM 15")

North America USA We expect enforcement to begin in July 2004. The Final Rule will probably be published in June 2004, and enforced thirty days later (July). Exporters of non-compliant wood packaging material will receive a written notice of non-compliance during the phase in period. It is not as yet clear when the phase in period will end, but exporters should expect to be fully compliant before July 1, 2004. Canada Canada plans to keep the same timetable as the US. The WPM standard became effective on the January 2, 2004, but will not be enforced until July 2004. Canada expects to have a 5-month phase in period allowing non-compliant wood packaging to be sent for treatment or disposal. Exporters of non-complying wood packaging material will also receive a written notice of non-compliance during the phase in period. Trade between U.S. and Canada to be seamless. Mexico Implementation in July or August 2004, with a phase-in period allowing non-compliant wood packaging to be sent for treatment or disposal. Exporters of non-complying wood packaging material will also receive a written notice of non-compliance during the phase in period.   European Union Implementation date now set for January 2, 2005 for wood packaging material excluding dunnage. Implementation for dunnage set at July 1, 2007. Important! The new WPM standard meets the requirements of the existing European Union emergency wood packing material measures. So if you ship WPM compliant packaging, then you will meet the current EU standard.   Australia Australia is now accepting the ISPM 15 heat treatment (Core temperature of 56°C for 30 minutes) as of December 1, 2003. Full implementation of ISPM 15 likely by July 1, 2004.   New Zealand New Zealand began implementing the ISPM 15 in August 2003 and is currently the only country implementing the rule.   Argentina Have indicated that they intend to implement ISPM 15 but no information available on likely date this will occur.   Brazil Have indicated that they intend to implement ISPM 15 but no information available on likely date this will occur. Brazil will accept ISMP-15 compliant wood from countries that have it set in place.

ISPM 15 FREQUENTLY ASKED QUESTIONS (FAQS)

WHAT IS WOOD PACKING MATERIAL?
Wood Packing Material (WPM), also known as solid wood packing material (SWPM) and non-manufactured wood packing (NMWP), is defined as "wood packing other than that comprised wholly of wood-based products such as plywood, particle board, oriented strand board, veneer, wood wool etc., which has been created using glue, heat, and pressure or a combination thereof." This includes pallets, crating, packing blocks, drums, cases, load board, pallet collars, skids, etc.

ARE PALLETS ONLY AFFECTED?
No. The standards will require all dunnage, including skids or runners used to transport bundles of lumber, to be heat treated as well.

CAN I APPLY THE MARKINGS AS SHOWN EVEN IF THERE IS NO AGENCY OVERSIGHT PROCESS ESTABLISHED WITHIN MY COUNTRY RIGHT NOW?
No, each National Plant Protection Organization (NPPO), the United States organization is USDA's Animal Plant Health Inspection Service (APHIS), is responsible for oversight of the program, the use of marks must be coordinated with the NPPO. Companies that use the marks improperly will be investigated, possibly prosecuted, and probably fined.

HOW STABLE IS THE STANDARD? WHAT IS THE TIMETABLE FOR POTENTIAL CHANGES TO IT?
The IPPC will be reviewed in three year cycles and the necessary adjustments.

HOW MANY COUNTRIES ARE MEMBERS OF THE IPPC?
The United Nations Countries number is 134 Countries. The IPPC is a convention of these members.

WHAT METHODS CAN BE USED TO SATISFY THE STANDARDS?
Acceptable treatment measures include heat treatment of solid wood components and fumigation of packing material with methyl bromide.

The official heat treatment program recognized by the USDA Animal Plant Health Inspection Service and the IPPC calls for solid wood components (hardwood and softwood) of packing material to be brought to a core temperature of 56 degrees Centigrade (about 133 degrees Fahrenheit) for a minimum of 30 minutes. The product must be stamped or marked by a registered agency. A fumigation program has been developed by the National Wood Pallet Container Association.

WHO WILL BE AFFECTED BY THESE MEASURES?
These regulations will not only affect pallet, box, and crate manufacturers/users, but also anyone shipping lumber over seas using solid wood skids and sticks.

CAN WE STILL USE UNTREATED MATERIALS ON SHIPMENTS BETWEEN NAFTA COUNTRIES?
NAFTA will allow transportation of goods between Canada and the United States without the certification marks.

However, NAFTA provisions do not apply to Mexico because of forest pests identified in Mexico.

WHEN DO HEAT TREATMENT REQUIREMENTS FOR HARDWOOD TAKE EFFECT?
On March 15, 2002 the IPPC adopted international regulations governing softwood and hardwood packing material. It will be up to individual countries to adopt the standards. Most countries plan to have their rules in place by the summer of 2004.

However the demand for products already marked is ever increasing as packaging material buyers build their inventories or convert inventories of treated materials.

WHAT IS BEING DONE TO REVIEW AND APPROVE OTHER TREATMENT METHODS SUCH AS IRRADIATION?
USDA-APHIS is not involved in development of new treatment methods. The IPPC will review the standards every three years, so such treatments can be examined at that time.

CAN MATERIAL THAT HAS BEEN HEAT TREATED AND STAMPED BE STORED OUTDOORS?
There are not specific standards on storage. Many audit programs are requesting that heat treated components & pallets be stored in a separate area from non-heat treated components and pallets, for your safety.

DOES THE STANDARDS APPLY TO ALL SPECIES?
Yes.

IS IT TRUE PALLETS MUST BE BARK FREE?
Generally No, the regulations have been through many drafts, and at one time there were requirements specifying debarked lumber (not necessarily bark free) within WPM. There was no scientific reason for this wording, since heat treatment should account for any bugs within the lumber or bark.

The requirements have an optional requirement for debarked lumber by individual nations. European Union countries have been supporting the debarking issues at the IPPC meeting. At this point it is unclear if these countries will adopt different standards.

IF I COMPLY FULLY WITH THE IPPC STANDARD AS IT READS NOW, WILL THE COUNTRIES THAT CURRENTLY HAVE REGULATIONS IN PLACE ACCEPT THOSE SHIPMENTS?
Each individual country must adopt their regulations that are consistent with the IPPC standard. If a country has a current standard, the current standard remains in effect until the country re-adopts the new standard.

CAN THERE BE A TRAVEL AROUND TREATER?
No. There must be a resident quality mark for each facility where the treatment has taken place.

HOW IS LOOSE DUNNAGE BEING TAKEN CARE OF?
There is no real guidance on loose dunnage. But the ALSC is giving the same advice that we gave and that is to board mark with the grade stamp, loose dunnage material, because it will eliminate any doubt in other ports around the country.

CAN BRANDERS BE USED ON MACHINERY TO BRAND THE PALLETS AS THEY ARE BEING MADE INSTEAD OF AFTER THEY ARE HEAT TREATED?
The American Lumber Standards Committee indicates that this is not an acceptable practice. The quality mark must be placed on the material after it is treated.

CAN A ROLLING MARK BE USED ON THE SIDE OF PALLETS?
Yes, a rolling mark may be used after the treatment process.

I HAVE BEEN RECEIVING SOFT WOOD AND HARD WOOD THAT HAVE JUST BEEN STAMPED "HT" ... BUT NOT THE GRADE STAMP THAT INCLUDES THE AGENCY LOGO AND PLANT NUMBER. CAN THIS HT LUMBER BE USED TO CONSTRUCT THE PALLETS FOR A STAMP (OR QUALITY MARK)?
No, the heat treated lumber must have the grade stamp that is audited by an agency prior to placing the quality mark.

WHAT ABOUT WOOD MATERIALS THAT ARE ALREADY ENROUTE? WILL THERE BE A "GRACE" PERIOD?
The standard doesn't address this, but our expectation is that there would be a phased in implementation period for each country.

HOW LONG DOES HEAT TREATMENT LAST?
Once components or pallets have gone through the heat treatment process, they are "heat treated" until removed from use.

CAN TREATED MATERIAL BE RE-USED?
A shipper may reuse the wooden pallet indefinitely once it is stamped as long as there are NO changes. There can be absolutely nothing done to the wooden pallet - it cannot be taken apart/reassembled, a tiny piece cannot be cut off, etc. If ANYTHING is changed with the pallet, then it must be re-treated and re-stamped.

HOW DO WE HANDLE RECYCLED PALLETS?
Recycled pallets must be completely re-treated. If packaging materials are repaired the entire unit must be retreated and marked.

WHAT IS FUMIGATION?
Fumigation is the process of placing wood packaging material in a confined area and using a chemical to treat the wood packaging material that will kill bugs, microscopic organisms, and rodents. The only approved chemical that can be used in the United States is Methyl Bromide.

The US EPA is in the process of phasing out the use of methyl bromide. However, there is a special exemption for the use of methyl bromide for quarantine and preshipment applications. This exemption was finalized on January 2, 2003.

WILL THERE BE REQUIREMENTS FOR FUMIGATION?
The National Wood Pallet and Container Association (NWPCA) is the national agency for fumigation standards. NWPCA will certify agencies to certify companies on the fumigation standards.

CAN FUMIGATION BE USED UNDER THE NEW INTERNATIONAL STANDARDS?
Yes, fumigation may be used to meet the international standards.