Optimization of forest biomass upply chain - incorporating uncertainties

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Forestry is one of the major industries in Canada and has a significant impact on our economy. It provides more than 800,000 jobs and contributes 3% to country's Gross Domestic Product. This important sector has been faced with many challenges due to appreciation of the Canadian dollar, intense competition from low-cost foreign producers, high cost of fibre, aging mills, real estate bubble burst in the US, and different tariff barriers. To remain competitive in the global market- place, the forest sector has to make difficult changes. Actions should be taken to diversify products and markets, invest in R&D, attract investments in the sector and introduce tax reforms. Bioenergy and bioproducts have been identified as areas for research and potential product and market diversification. Similar to other long-term industry investments, the success of a bioenergy project depends on careful assessment of many different factors and proper decision making at different planning and engineering stages. Long term decisions include the decision on bioenergy plant location, biomass preprocessing facility location, storage capacities and location, feasibility analyses, logistics, transportation and handling of biomass. Planning and managing the entire supply chain of forest biomass is a challenge. Utilization of forest biomass requires deciding when and where biomass is collected, where it is preprocessed, how it is transported, how long and where it is stored to minimize the cost (or maximize the value generated) and satisfy the demand. Uncertainty issues in multi-site, multi-product supply chain planning problems are also important to be considered.