Production-Storage and Transport Integrated Planning for a Multi-site Mining Industry

Abstract

Assuming that local planning usually leads to sub-optimal solutions, this work aims to solve an integrated production, storage and distribution problem as part of a global supply chain system. The problem we address combines a lot sizing and distribution problem in a multi-level, multi-product, multi-period production network. To solve it, we propose a MILP (Mix Integer Linear Program) taking into consideration the local constraints of the different subsystems, but also the global ones that express the interactions between subsystems. This model proposes simultaneously a production, storage and transport plan that satisfies a known demand while minimizing total production, storage and distribution costs. Finally, the solutions found within this approach have the advantage of considering the system’s overall decisional cohesion as well as the constraints propagation in the various links of the chain. The originality of the work comes from the fact that we have addressed a multi-level lot-sizing problem, combined with a single rail transport problem. This integrated problem, to the best of our knowledge, has not been previously addressed. The model is tested and validated on a real mining industry, it proposes an integrated solution for simultaneous production, storage and distribution planning.