An Optimization model for biofuel supply chain design under autoregressive moving average demand

Biofuel is known as one of the best gasoline substitutes in the transportation industry. Designing an optimal supply chain is an essential requirement for the commercialization of biofuel production. This paper presents a mixed integer linear programming model to design a biofuel supply chain in which biofuel demand is under autoregressive moving average time series models. It is studied how the autoregressive moving average time series structure of biofuel demand affects the given supply chain design. Also, a numerical example demonstrates application of the proposed model used to design the most optimal biofuel supply chain. In addition, to provide insights for efficiently designing the biofuel supply chain, the autoregressive moving average models of biofuel demand are used to forecast biofuel supply chain design for an 8-year time horizon.