Sustainable Supply Chain: Feedstock Logistics Issues of Palm Oil Biomass Industry in Malaysia

Abstract

The palm oil industry contributes about 85 percent of the total biomass production in Malaysia, hence offering great potential for renewable power generation and other green products. However, supply chain literature and industry players have identified that one of the main barriers to a successful biorefinery industry is the lack of sustainable supply chain for feedstocks, particularly feedstock logistics. Feedstock logistics encompass all necessary operations that source and supply feedstocks from the plantation field or forest to the throat of conversion reactor at a biorefinery plant. Depending on the biomass type, the feedstock major logistics components typically include harvest and collection, storage, pre-processing, and transport. These components are interdependent and should be considered and planned from a chain perspective rather than separately in order to achieve an efficient and cost-effective biomass supply. Feedstock logistics, particularly in developing economies such as Malaysia, has received limited attention in the biorefinery supply chain literature. Therefore, it is imperative that we highlight some of the barriers and challenges faced by the industry players along the oil palm biomass feedstock logistics chain. The overview of feedstock logistics issues associated with the oil palm biomass will provide a perspective from which an industry’s viability can be evaluated and help the industry players to better understand feedstock logistics risks and improve their logistics processes for a sustainable, efficient and cost-effective feedstock supply.