Integrated Bio-Refinery and Forest Products Supply Chain Network Design Using Mathematical Programming Approach

This study presents a mathematical programming approach to design an integrated bio-refinery and forest product supply chain network. In the text, the basic concepts of supply chain, supply chain management, and supply chain design are introduced. The mathematical programming and its applications on various supply chain design problems are reviewed. Earlier works in the supply chain design problems have focused on the supply chains serving the primary product flows. The flows of energies, fuels, as well as the process biomass residues are generally ignored. Since forest and process biomass residues play a significant role in the bio-energy and bio-refining operations, which could subsequently reduce the non-renewable energy and fuel consumptions, these flows must be considered in the design of the bio-refinery supply chain. In this study, we present a mixed integer programming model for the integrated bio- refinery and forest product supply chain. A general market-driven supply chain network structure is proposed allowing the optimal investment decisions to be made in choosing the right facilities, technologies, capacities, and their locations, that strategically maximize the supply chain value. In the model development, the biomass and energy supply decisions are also considered as decision variables. The model is validated using an experimental case.

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