Article ID Journal Published Year Pages File Type
1022998 Transportation Research Part E: Logistics and Transportation Review 2016 19 Pages PDF
Abstract

•Robust bi-level models for processing/storage facility locations in a grain supply chain.•Post-harvest loss and harvest time equilibrium among independent farmers.•Risk-averse and risk-seeking investment strategies in light of crop yield uncertainty.•Application to Illinois and Brazil cases for managerial insights.

This paper presents a bi-level robust optimization model, where a food company maximizes its profit and minimizes post-harvest loss by optimally deploying grain processing/storage facilities and determining grain purchase price, while a group of spatially distributed non-cooperative farmers determine harvest time, shipment, storage, and market decisions under yield uncertainty and market equilibrium. The non-cooperative behavior of the food company and the farmers is represented by a bi-level Stackelberg leader follower’s game model with mixed-integer decision variables. The proposed model and solution approach are applied to case studies for Illinois and Brazil.

Related Topics
Social Sciences and Humanities Business, Management and Accounting Business and International Management
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