The Economic Potential For Optimal Destination of Roundwood in North Sweden - Effects of Planning Horizon and Delivery Precision
Authors
Anton Bergdahl
Anders Örtendahl
Dag Fjeld
Swedish University of Agricultural Sciences
Abstract
This study quantifies the economic effect of optimizing roundwood destinations in North Sweden. The effect of planning horizon and delivery precision on costs and revenues are also quantified. The results show that the effect of optimizing roundwood destination varies with the specific application. When minimizing transport costs for a forest company, the transport output (t-km) was reduced by 8-9%. The reductions of transport costs in this case were often in the range of 4-5% (two-week planning horizons). Longer planning periods gave slightly greater cost reductions. Increased net revenues of roundwood sales by an independent forest owner organization were in the area of 1-4% (two-week planning horizons). In this case, however, transport output was often increased by the optimization. Reduced demands to delivery precision made it possible to achieve greater increases in net revenue. Shorter planning horizons had fewer active supply nodes. This situation requires greater spatial variation in procurement areas in order to fill the demand restrictions per period. Only 15-20% of the annual procurement volume per sawmill came from supply nodes where the mill acted as monopsonist.
