Century Kingdom Traders (CK Traders) would secure long-term supply of raw material for renewable energy biomass initiative, through offtake agreement with associate company CK Plantation. The back to back contract would allow CK Traders offtake buyers to secure a consistent supply of processed material for the power plant, and industrial use of environmentally friendly recycled resources.
Biomass resources have been in use for a variety of purposes since ages. The multiple uses of biomass include usage as livestock or for meeting domestic and industrial thermal requirements or for the generation of power to fulfill any electrical or mechanical needs.
One of the major issues, however, associated with the use of any biomass resources is its supply chain management. The resource being bulky, voluminous and only seasonally available creates serious hurdles in the reliable supply of the feedstock, regardless of its application. The idea is thus to have something which plugs in this gap between the biomass resource availability and its demand.
The Problem
The supply chain management in any biomass-based project is nothing less than a big management conundrum. The complexity deepens owing to a large number of stages which encompass the entire biomass value chain. It starts right from the resource harvesting and goes on to include the resource collection, processing, storage and eventually its transportation to the point of ultimate utilization.
Owing to the voluminous nature of the resource, its handling becomes a major issue since it requires bigger modes of logistics, employment of a larger number of work-force and a better storage infrastructure, as compared to any other fuel or feedstock. Not only this their lower energy density characteristic, makes it inevitable for the resource to be first processed and then utilized for power generation to make for better economics.
All these hassles associated with such resources, magnify the issue of their utilization when it comes to their supply chain. The seasonal availability of most of the biomass resources, alternative application options, weather considerations, geographical conditions and numerous other parameters make it difficult for the resource to be made consistently available throughout the year. This results in poor feedstock inputs at the utilization point which ends up generating energy in a highly erratic and unreliable manner.
The Solution
Although most of the problems discussed above are issues inherently associated with the use of biomass resources, they can be curtailed to a larger extent by strengthening the most important loophole in such projects – The Biomass Resource Supply Chain.
World over, major emphasis has been laid in researching upon the means to improve the efficiencies of such technologies. However, no significant due diligence has been carried out in fortifying the entire resource chain to assure such plants for a continuous resource supply.
The usual solution to encounter such a problem is to have long term contracts with the resource providers to not only have an assured supply but also guard the project against unrealistic escalations in the fuel costs. Although, this solution has been found to be viable, it becomes difficult to sustain such contracts for longer duration since these resources are also susceptible to numerous externalities which could be in the form of any natural disaster, infection from pests or any other socio-political or geographical disturbances, which eventually lead to an increased burden on the producers.
CK Traders on top of associate companies consistent supply, also secures a predictable supply of raw material for biomass, using long-term contracts with major sawmill and plantation concession owners, ensuring our customers under off-take agreements.
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