25.12.2013 Views

Download (4Mb) - USQ ePrints - University of Southern Queensland

Download (4Mb) - USQ ePrints - University of Southern Queensland

Download (4Mb) - USQ ePrints - University of Southern Queensland

SHOW MORE
SHOW LESS

Create successful ePaper yourself

Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.

• Marginable economics for converting biomass to electricity and other byproducts.<br />

• Mallee production which is generally regarded as non-core business in a cereal cropping<br />

farming enterprise.<br />

• The Mallee tree is particularly difficult to harvest and process cost effectively owing to its<br />

physical characteristics and plant layout.<br />

The structure <strong>of</strong> an industry and its participants will affect the supply chain. For example the<br />

Australian sugar industry is structured with predominately family owned farms, and a range <strong>of</strong><br />

ownership structures for harvesting. Cooperative or company owned mills are responsible for cane<br />

transport, the manufacture <strong>of</strong> sugar and other products, and now, with a deregulated environment, for<br />

contracting storage, marketing and shipping. This means that there are many pr<strong>of</strong>it centres with each<br />

centre and sector seeking to maximise its income and minimise its costs (SRDC 2006b). Individual<br />

sector goals, however, may impose costs across the entire value chain such that whole-<strong>of</strong>-system<br />

pr<strong>of</strong>itability is not maximised. Opportunities exist, therefore, for more integrated management <strong>of</strong> the<br />

value chain to enhance revenue and cost efficiency for the benefit <strong>of</strong> all industry participants (SRDC<br />

2006b). A key driver in the cane industry has been a cane payment formula based on quality <strong>of</strong> the<br />

product delivered, which is impacted by operation <strong>of</strong> the supply chain in terms <strong>of</strong> delivery delays and<br />

impurities from the field.<br />

The Mallee Industry in Western Australia is largely structured around independent wheat farmers who<br />

have no strong links to biomass markets and processors and for which there is no established harvest<br />

and transport system. Biomass processors are unlikely to manage the supply chain, but one value<br />

chain option is that a large central processor will engage or form an agent to occupy a “middle-man”<br />

role. Farmers could similarly form a cooperative or other corporate structure to be the middle-man.<br />

A key part <strong>of</strong> managing the supply chain will be in product diversification. This is discussed in<br />

greater detail in Chapter 4. Diversification within the sugar industry has considered production <strong>of</strong><br />

renewable energy from ethanol or electricity co-generation and other possible new enterprises, such as<br />

the production <strong>of</strong> fibre-based products (paper, packaging, etc.) or lactic acid and other chemical byproducts,<br />

livestock feed and fertilizers products.<br />

Product diversification for Mallee biomass is also likely, with products including electricity,<br />

eucalyptus oil, and the use <strong>of</strong> pyrolysis to produce liquid fuels (via bio-crude oil or Fischer Tropsh<br />

synthesis), biochar and chemicals. This diverse product base will also affect supply chain<br />

management. Sugarcane product diversification evolved from an established sugar market which<br />

was able to sustain development <strong>of</strong> new product streams. Development <strong>of</strong> an established biomass<br />

market will be required to support development <strong>of</strong> sustainable biomass supply chains. It is not<br />

clear whether this large scale market will be for electricity generation or the bio-oil market.<br />

Bezuidenhout and Bodhanya (2010) identify a supply chain as being a composition (or framework) <strong>of</strong><br />

five important building blocks Figure 6.1. The value chain is concerned with systems properties<br />

describing value-adding, value loss and distribution <strong>of</strong> benefits throughout the chain. Second, a<br />

material handling chain, concerns the physical equipment and processes used to enable value adding.<br />

The third dimension, viz. a collaboration chain, focuses on the way stakeholders collaborate and comanage<br />

the material handling activity. Fourth, the collaboration chain is held together through an<br />

effective information chain that enables stakeholders to manage their system. Finally, only once these<br />

four chains are understood and well managed, could one consider integrated system innovations<br />

where all processes are aligned to enhance efficiency. Bezuidenhout and Bodhanya (2010) suggest<br />

that the interaction between the different above-mentioned chains is critical and any innovation that<br />

does not consider all these dimensions simultaneously will probably fail.<br />

141

Hooray! Your file is uploaded and ready to be published.

Saved successfully!

Ooh no, something went wrong!