Optimal location of laminated beech production plants within the solid hardwood supply network in Austria

Abstract

Due to changes in forest management in various European countries, hardwood forest areas and amounts will increase. Sustainable and individual utilization concepts have to be developed for the upcoming available resource. Studies conclude that there is low potential for hardwoods in the traditional appearance market thus the application areas have to be extended to new structural innovative products. This paper examines the extension to a future laminated beech wood supply network which would be a combination of already existing and new production facilities. For a better future use of hardwood raw materials it is necessary to consider the entire supply chain. This also better shows a total hardwood value chain. Therefore, this paper provides data to the solid hardwood business and develops a mixed integer linear programming to design a laminated beech wood supply network. The model is applied to Austria as the sample region. It covers the important strategic decisions where to locate a downstream facility within the existing production network with the lowest supply network cost. Fourteen scenarios are developed to examine various future network configurations. Results about optimal material flows and used sawmills as well as downstream production facilities are presented in form of material and financial performances. Two optimal laminated beech production locations are determined by the calculated scenarios results, and the impact of a new sawmill is analyzed which is focused on beech.