Simulation-Based Cost Analysis of Industrial Supply of Chips from Logging Residues and Small-Diameter Trees

Abstract

Research Highlights: The use of terminals can increase supply costs by 5–11% (when compared to direct supply), but terminals help secure supply during peak demand and cope with operational problems in the supply fleet in cases where direct supply chains would be unable to meet demand on time. Background and Objectives: This work analyses the supply cost of chipped logging residues and small-diameter trees, from chipping at roadside storages to delivery to the end-user. Factors considered include demand curves (based on the requirements of a theoretical combined heat and power plant or biorefinery); demand volume; and mode of supply (direct or combined via terminal). The impact of longer trucking distances from the sites, and supply integration between forest and other land (varying relocation distances) was also assessed. Materials and Methods: The operational environment and work of a theoretical chip supplier in northern Sweden were modelled and simulated in ExtendSim®. Results: The mean supply cost of chips was 9% higher on average for combined chains than for direct chains. Given a high demand, 8% of the annual demand could not be delivered on time without using a terminal. High supply integration of forest and other land reduced supply costs by 2%. Contractors’ annual workloads were evened out by direct supply to the biorefinery (which has a relatively steady demand) or supply via-terminal independently of the end-user. Keeping distinct chips from different sites (implying that trucks were not always fully loaded) instead of mixing chips from different sites until the trucks were fully loaded increased supply costs by 12%. Conclusions: Terminals increase supply costs, but can enable demand to be met on time when direct supply chains alone might fail. Integrated supply planning could reduce supply costs by increasing the utilization of residual biomass from other land.

Contingency Plans for the Wood Supply Chain Based on Bottleneck and Queuing Time Analyses of a Discrete Event Simulation

“…A potential for improvement could be the modeling of wood value loss during long lead times and the implementation of different delivery strategies [29]. Next to advantages such as buffer capacity and saved emission, terminals also show disadvantages such as higher costs, which were accordingly discussed for the wood assortment chips [38]. Managerial options such as staggered shifts, or targeted use of over-time working were not considered in this study but provide promising opportunities for further research.…”

Productivity and profitability of harvesting overgrown roadside verges – a Swedish case study

“…However, the variation in biomass density along roadside verges and other land-use types can be large, and the roads or other land-use types can be scattered across the landscape, necessitating frequent relocation of the machinery (Fernandez- Lacruz and Bergström 2015). To address those challenges, integrating the management of forest and other land-use types has been suggested, to increase the utilization of machine capacity and decrease supply costs (Fernandez-Lacruz et al 2020). Moreover, to be able to manage roadside verges effectively for both maintaining road functionality and biomass production, there is a need to balance the negative effects of allowing the vegetation to grow versus the income it may generate.…”

Impact of Roadside Drying on Delivered Costs for Eucalyptus globulus Logging Residue and Whole Trees Supplying a Hypothetical Energy Plant in Western Australia Using a Linear-Programming Model

“…Operational implementation of the NS scenario may need additional storage area at an intermediate depot or at the power plant to better match FB supply and demand. Intermediate storage has not previously been considered for Australian forest biomass supply chains as the hypothesised demand for FB is relatively consistent over a year compared with northern hemisphere supply chains, which have a large peak in FB demand in winter to meet heating needs [79]. As intermediate storage can increase FB delivered costs by 10-20% [52], further studies would be required to examine the potential need for intermediate storage and the cost implications in the Australian context.…”