Skip to content

Renewable Energy

Selfishness is key factor in biofuel supply chain

by Linden Volsun 20 Apr 2012
Selfishness is key factor in biofuel supply chain

Biofuel image via Shutterstock

Studies on how to maximise the biofuel supply chain have overlooked a key factor – selfishness, say researchers. University of Illinois scientists have created new computer modelling that takes into account competition between the biofuel and food markets and between farmers.

With rises in the amounts of biofuel produced, especially corn-based ethanol, the battle for feedstock between grain for agriculture and refineries has become more fierce.

The question how best to use farmland is vital for energy and food security and sustainable practices.

Previous studies have overlooked the vital factor of the selfishness of farmers and the biofuel sector that each search for maximum profit.

University of Illinois civil and environmental engineering professor, Yanfeng Ouyang, says, "A lot of researchers now working on biofuel supply chain optimization have not been able to develop a holistic model that can address such complex interactions among multiple stakeholders in a comprehensive framework."

The study, Biofuel Supply Chain Design Under Competitive Agricultural Land Use and Feedstock Market Equilibrium, has just been published in the Energy Economics journal and backed by the National Science Foundation.

Previous research supposed that farmers make their decisions together or cooperatively, but the Illinois researchers believe individual farmers fight for a share of the market. They can choose to sell to the food or biofuel markets, or a mixture of the two, depending on transportation costs and profit levels.

As biofuel and grain refineries have limited capacity and price ceilings, farmers are battling with each other to be able to sell.

Head of industrial and enterprise systems engineering and at Illinois University Caterpillar Professor, Jong-Shi Pang, says, "The amount sold to the market determines the price on the market, which in turn influences everyone’s production. That’s the kind of decision-making problems that all the players have to resolve."

The university team, student, lead author Yun Ba, Jong-Shi Pang and Yanfeng Ouyang used data from the production and sales of corn to create computer modelling, which was applied to different business scenarios.

Jong-Shi Pang, Yun Ba and Yanfeng Ouyang

Researchers: From left to right, Jong-Shi Pang, Yun Ba and Yanfeng Ouyang; Photo by L. Brian Stauffer

The researchers applied the models to various business scenarios; for example, farmers cooperating with the biofuel industry through farmland leasing or acquisition. The estimated improvement in overall system profit can provide guidelines for how much effort stakeholders should invest to achieve such business scenarios.

The modelling offers principles to get the most out of the biofuel supply chain, the best place for bio refineries and how capacity affects profit. It also took into account pay and location issues for farmers.

The modelling can also be used to quantitatively assess how farmers and prices are affected when a biofuel supply chain comes into the market.

They found that diverting some of the corn crop to ethanol affects food prices to varying degrees. However, the overall system welfare improved, with farmers being the primary beneficiaries.

The team believes that competition benefits farmers, as they have alternative markets with additional bidding options.

The trio plan to develop their models to include the impact on the environment changes in production and the rotation of crops.

The full report is available online.


Trending Eco-Friendly Clothing

Love My Planet Women's Relaxed Fit Hoodie
Earth
Quick Add
Close
Notify me
Notify me
Love My Planet Women's Relaxed Fit Hoodie
Love My Planet women's eco-friendly relaxed fit hoodieSize Guide Centimeters 8 10 12 14 16 18 Bust 84 88 92 97 103 108 Waist 66 70 75 80 85 91 Hips 91 95 99 104 109 116 Bust: Measure around the fullest part of...
£38.00
£38.00
Close
Notify me
Notify me
Penguins Hate Push-Ups Men's Pullover Hoodie
Earth
Quick Add
Close
Notify me
Notify me
Penguins Hate Push-Ups Men's Pullover Hoodie
Penguins Hate Push-Ups men's eco-friendly pullover HoodieSize Guide Centimeters XS S M L XL XXL Height 171 175 179 183 189 195 Chest 86 93 99 104 116 129 Waist 71 76 81 89 99 112 Chest: Measure all round your chest just below...
£38.00
£38.00
Close
Notify me
Notify me
Lightning Bolt Kids Long Sleeve T-Shirt
Earth
Quick Add
Close
Notify me
Notify me
Notify me
Lightning Bolt Kids Long Sleeve T-Shirt
Lightning Bolt kids eco-friendly long sleeve t-shirtSize Guide Centimeters 3-4yrs 5-6yrs 7-8yrs 9-10yrs 11-12yrs Height 98 112 125 136 147 Chest 60 66 70 75 84 Chest: Measure all around your chest just below your armpits. Height: Your natural height If you fall between...
£18.00
£18.00
Close
Notify me
Notify me
Notify me
Union Jack Tote Bag
Earth
Quick Add
Close
Notify me
Notify me
Union Jack Tote Bag
Union Jack eco-friendly colour tote bagProduct Specification Organic Cotton Tote Bag. Twill Weave (170gsm). 37 x 42 cm (7cm gusset.) Made in India / Designed on the Isle of Wight. Wash Cool, Hang Dry.
£16.00
£16.00
Close
Notify me
Notify me
Prev Post
Next Post

Eco-Friendly Shop

Women's Clothing

Eco-Friendly Clothing for Women Our online shop offers a wide range of sustainable women’s clothing products, including t-shirts, hoodies, vests, sweaters, shorts, and...
Shop Now

Men's Clothing

Eco-Friendly Clothing for Men Our online shop offers a wide range of sustainable men’s clothing products, including t-shirts, hoodies, vests, sweaters, shorts, and...
Shop Now

Kids Clothing

Eco-Friendly Clothes for Kids Our online shop offers a wide range of sustainable kids clothing products, including t-shirts, hoodies and jumpers. Our garments...
Shop Now
Someone recently bought a
[time] ago, from [location]

Thanks for subscribing!

This email has been registered!

Shop the look

Choose Options

Earth Times
Sign up for exclusive updates, new arrivals & insider only discounts

Recently Viewed

Edit Option
Back In Stock Notification
this is just a warning
Login
Shopping Cart
0 items

Before you leave...

Take 20% off your first order

20% off

Enter the code below at checkout to get 20% off your first order

CODESALE20

Continue Shopping