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The sugar industry has a number of ownership models. Generally the greater the proportion of the supply chain owned by a single entity (eg a cooperative) the greater the efficiency and lower the conflict. Good performance across the value chain also results when there is cooperation and commitment between each sector in sharing business proceeds. Ideally the harvest and transport system would be more readily optimised if owned by a single party managing the process from plant in the field to biomass delivered to the mill. In practice the harvest and transport system of the sugar industry involves multiple combinations of ownership including farmers (hundreds), contract harvesters (several to many), contract truck transport and the sugar mill. Harvest and transport systems are recognised as a priority for quantum gains in productivity. To achieve a sustainable biomass industry, the Mallee industry needs a streamlined value chain with an intermediary party or organisation facilitating harvesting, transport and supply arrangements. This will limit capital requirements, multiple combinations of ownership, potential conflicts and costs. This will be particularly important for the Mallee industry since the interdependence of the grower and the processor is less entrenched than in the sugar industry. Supply arrangements for mallee biomass are more likely to be driven by commercial opportunity than by necessity as is the case for sugar. Alternatively the cooperative harvesting groups / partnerships, found in the NSW Sugar Industry, provide a good example of how the growing sector, consisting of relatively small scale operators can maintain ownership of the supply chain while operating a highly efficient harvest and transport system. A key requirement will be establishing confidence through long term contracts and supply agreements. This has to be informed by the availability of material and the feasibility of supply in the production or supply area which represents the profit centre. Whilst the business and industry structures described provide the mechanism for things to occur, there remains an underlying requirement for a critical mass of supply within an economic radius. This is certainly the experience within the sugar industry where various ownership models and structures are in place and yet a number of mills have closed in recent years. Supply chain management, planning and modelling Many years of supply chain research in the sugar industry have highlighted the unique characteristics and requirements of different processing or supply areas where local situations will have an overriding effect. Research has also emphasized that the focus of supply chain planning and management should be broadened from the narrow logistical and operational technical issues to include improving the transparency of information, integration of the various businesses within the supply chain, and awareness of new market opportunities. Relationships between sectors and participants in the supply chain are important and where there has been a tradition of cooperative relationships between participants, or a major effort has been placed to develop these relationships, there has been greater progress in improving the supply chain. Sugar experience has shown the importance of promoting both tangible and intangible benefits of value chain improvement to stakeholders. While sometimes difficult to quantify they provide a key incentive for adopting system improvements. Flexibility is essential in biomass supply chains to cope with and adapt to unforeseen events such as weather impacts, equipment failure, changes to industry participants and cross-sector relationships. Appropriate standard contracts and protocols for services will support best management practice and equitable distribution of proceeds. 179
While diversification can add value to the industry, the impact on supply chain constraints needs consideration. The benefits and practicalities, capital requirements, and cost of production of each product as well as the sustainability of those markets over time need assessment. While improved technology, such as the prototype harvester, will give a step change in cost efficiency, equal consideration must be given to integration with other elements of the supply chain and accumulated incremental improvements. Account should be given to the social and human aspects of the supply chain. Trust will be a key ingredient and commitment should be sought to share information, improve the understanding by all participants of the drivers and operations of all sectors and increasing the size of cake as well as equitable apportionment of risks and rewards across the value chain. A range of supply chain models and tools have been developed and applied in the sugar sector. These systems can be readily customized for mallee biomass supply and could include: • Spatial mapping of mallee feedstock including age and planting arrangement to improve harvest management, reporting, mapping and data exchange. • Monitoring of harvest progress using GPS tracking on harvesters and transport units to record area and volume of biomass removal, consignment delivery and, based on weighbridge data at the processor, paddock yield. • Tracking of road haulage equipment based on GPS tracking to inform scheduling of deliveries and asset management. • Harvest haul modeling of specific supply areas to optimize placement of loading zones and layout of mallee plantings. • Refinement of mallee biomass production models to optimise farm layout and row spacing, given information on soil type, drainage and adjacent crop requirements to understand and account for both the farming and harvesting sectors. Ideally application of these tools should encompass the entire value chain from biomass production, to harvesting and transport, processing and product diversification options. Supply chain modelling and economic considerations A desktop assessment of mallee harvest haul logistics was completed for Western Australian alley plantings based on the model widely used in the sugar industry. The analysis showed that harvester pour rate has the largest impact on the cost of harvest and transport. Annual tonnage harvested also has a large effect on the cost of harvest since increased throughput provides better capital utilisation. Road haul distance has the next largest effect on cost on harvest-transport costs. With haul distances of 100km haulage costs are likely to be around $15/t. Capital cost of equipment and belt spacing was shown to have a small impact on the cost of harvest. For a small scale emerging industry (14,400 tonnes biomass harvested per year) and current prototype harvester performance (30green tonnes/hr pour rate) harvesting and infield transport costs are likely to be around $30/green tonne. Combined with road haulage costs of $15/tonne this would equate to a delivered cost to a processor of $45/green tonne. The mallee grower and harvest/haul contractor would expect a profit and delivered cost is likely to exceed what a processor is prepared to pay. For large scale industry development (144,400 tonnes biomass harvested per year) and future harvester performance (50green tonnes/hr pour rate) harvesting and infield transport costs would be around $13/green tonne. Combined with road haulage costs of $15/green tonne this would equate to a 180
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Sustainable Biomass Supply Chain fo
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Foreword This report provides an as
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include business development (new p
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Acknowledgments The authors would l
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4.1 Product Options and Supply Chai
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Table 4.2 Assessment of current val
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Figure 3.4 Tracked rigid self-prope
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Executive Summary What the report i
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• Biomass production potential of
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• As the Industry expands, the mo
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Harvesting, transport and storage s
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Biomass processing, supply chain pl
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Key barriers to biomass industries
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Crop-Biomass Production Production
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Figure 1.1 The cropping and pasture
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Table 1.1 Mallee species used for p
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1.1.4 Growth Cycle Mallee System Ma
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northern New South Wales (where it
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Almost 80% of the industry now cuts
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Bark has relatively high ash but as
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Carbon sinks Planting of mallees to
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Table 1.5(a) State Land area devote
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out the fluctuations in farm income
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Mallee system Most of the mallee bi
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inconclusive result may have been d
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For a sustainable woody crop indust
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changed significantly since they we
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Figure 2.2 Biosystems Engineering p
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Whole-of-crop harvesting represents
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During the last decade the harvesti
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single row, as this would improve t
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2.2.2.2 Weight Sugar System The Aus
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Table 2.1 Harvester Comparison Tabl
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The quality of cut may be less impo
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ate than a 170 tonne/ha crop of sta
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Dry Leaf 6.1 - 3.5 17.0 58.9 53.2 T
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Bulk density will be a key consider
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Table 2.4 EM levels in cane supply
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L/T L/T 60 0.97 0.71 80 0.92 0.66 1
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Total 7.5-26 16.5 Mallee System The
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• waiting for mill delivery of em
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perhaps at 10 - 20 km intervals. Th
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transport arrangements, harvest gro
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contractors and growers, and the fa
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experience of the sugar industry wi
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Table 2.11 Alternative harvest paym
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onto the harvester. BR+F still send
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Repairs and maintenance 2.10 Capita
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Figure 2.14 and Table 2.14 describe
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Sichter et al. (2005)), harvest and
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Transport efficiencies may be possi
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3. Transport and Storage Systems Tr
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same time, the potential problems o
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Figure 3.3 Articulated self-propell
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• The harvester will not have any
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Figure 3.7 Gross mass compared with
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external factors dramatically impac
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Figure 3.11 The effect of haulout t
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3.3 Road Transport 3.3.1 Configurat
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Figure 3.15 shows an example of the
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Road distance one way < 20 km 70 km
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Haul distance is largely outside th
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3.6 Recommendations The nature of t
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• The strategy offered lower tota
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sugarcane billets are such that wit
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• Transfer the whole tree product
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Figure 4.5(b) Energy balance of con
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2010). Table 4.2 presents a summary
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4.4.2 Activated charcoal Activated
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Nett Product Value ($/t) $475.00 $
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Table 4.9 presents an estimation of
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• Oil from leaf @ $2/kg • Synth
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• The mallee oil would be extract
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5. Industry and Business Structures
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is conducted into tariff levels on
Page 151 and 152: Bx is % brix in first expressed jui
Page 153 and 154: Hildebrand (2002) estimated that th
Page 155 and 156: also has a flow on effect to the sp
Page 157 and 158: Sugar Industry Illustrative Example
Page 159 and 160: with super size multi-lift bins ove
Page 161 and 162: farmer vs. harvester) is the next l
Page 163 and 164: 6. Supply Chain Planning and Manage
Page 165 and 166: Figure 6.1 Building blocks of the s
Page 167 and 168: weighed against the costs of operat
Page 169 and 170: • There is close contact between
Page 171 and 172: 6.4 Planning, Management Tools and
Page 173 and 174: • Harvest and transport logistics
Page 175 and 176: interface. The system allows users
Page 177 and 178: Case Study 6.2 - Model Application
Page 179 and 180: Relationships between sectors and p
Page 181 and 182: 7. Supply Chain Modelling and Econo
Page 183 and 184: It was assumed that there was a fif
Page 185 and 186: Table 7.2 Scenario two capital equi
Page 187 and 188: Table 7.4 Fuel burn rates harvester
Page 189 and 190: Figure 7.5 Effect of capital equipm
Page 191 and 192: Figure 7.7 Effect of annual tonnes
Page 193 and 194: 30 1.8 7.0 12.3 17.5 50 1.1 4.3 7.6
Page 195 and 196: 8. Conclusions and Recommendations
Page 197 and 198: Biomass bulk density has a large im
Page 199 and 200: Vehicles used for infield haulout w
Page 201: This can be compared with harvest a
Page 205 and 206: Appendix 1: Comparative Assessment
Page 207 and 208: and transport conditions. Billet le
Page 209 and 210: that cane production is the most pr
Page 211 and 212: on sugar only, other proceeds (mola
Page 213 and 214: References Agnew, J 2002. A Partici
Page 215 and 216: Enecon 2001. Integrated Tree Proces
Page 217 and 218: Keating, BA, Antony, G, Brennan, LE
Page 219 and 220: Ridge, DR and Linedale, AL, 1997. T
Page 221: Willcox, T, Hussey, B, Chapple, D a
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