Facilities Location Models: An Application for the Forest Production and Logistics

Abstract

In this article we put forward a mathematical model of the problems of production and logistics in the forest industry. A mixed-integer dynamic optimization model was formulated to solve simultaneously three common problems in the forest environment: production, location of facilities, and distribution. When implemented, the mathematical model allows the strategic choice of the optimum location and size for the forestry facility as well as identification of the production levels and freight flows generated during the considered planning horizon. To evaluate the usefulness of the model, it was applied to the practical problem of the location of a sawmill. All the information about this particular facility that is needed as input to the model was provided by a private company. The model was solved using off-the-shelf software, which also allowed us to evaluate the responsiveness of the model to changes in the initial conditions.