Feasibility study: Supply chain modelling and simulation of hemp fibre production in Ireland

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Insinööritieteiden korkeakoulu | Master's thesis
Zero Defect Manufacture for a Circular Economy
Degree programme
Master’s Programme in Manufacturing
With the growing concerns of environmental issues and awareness of sustainable development, industrial hemp has been proposed as one of the strategies to react to the ecological crisis and challenges that are caused by the transition from the traditional power plant to a sustainable ecosystem in Midland Ireland, with the support of the Just Transition Funds which was introduced by the Irish government. Industrial hemp has a wide range of applications and commercial value. However, a very limited focus has been put on hemp fibre production, compared to CBD-related products. A small number of studies have established a framework for hemp production and management from raw materials to sales. Few studies can provide auxiliary information for the feasibility analysis of growing industrial hemp. This thesis aims to contribute to the feasibility study of hemp fibre production in Ireland by conducting supply chain modelling and simulations of hemp animal bedding in Ireland. This paper establishes the supply chain framework for hemp production and presents the results of the supply chain simulations in 5 scenarios for hemp animal bedding in Ireland. Firstly, the gap and problem were identified through the studies of hemp cultivation, the uses and production of hemp and its legal status. Modelling and simulations of the supply chain were defined as the solution method towards the objective of this study. Further, data has been collected from local farmers and external resources by mixed methods including literature review, conferences and interviews with local farmers. Moreover, modelling and simulation studies using anyLogistix optimization software were conducted to evaluate the performances of the supply chain according to the specified KPIs, such as lead time, total cost and service level. Finally, possible strategies and recommendations were given based on the analysis of the study results to aid the further decision-making process and feasibility study. The main findings include that the modelling and simulation analysis of the supply chain is an effective method for the feasibility study. The supply chain modelling visualizes project structures, provides relevant simulation data results to aid decision-making, and establishes the basis for subsequent models. In addition, hemp fibre production is a profitable business while the initial site cost, especially the essential machinery is the main cost of opening a new hemp fibre business. 1 DC in Ireland would be the most economical strategy for the short term, while 3 DCs could realize a good service level. Further, the effectiveness of the supply chain is not dependent on one single factor, the interactions between different parameters are complex. Future studies could focus on the analysis of more detailed and comprehensive simulations with more data and more designed scenarios. The feasibility of the project could be studied from other aspects apart from supply chains.
Salmi, Mika
Thesis advisor
Ghadimi, Pezhman
supply chain, supply chain modelling, supply chain simulation, feasibility study, industrial hemp, hemp fibre production
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