- The purpose of this study was to examine the feasibility of
processing and marketing the hardwood bark and finewood residue
materials generated by the primary wood using industries located within
the project study area (an area encompassing all of Illinois and
area fifty miles wide surrounding Illinois). The study (1970 through
1973) involved three separate phases of work.
The first phase developed information regarding the sources of
residue materials both with regard to the geographic distribution of
the mills generating the residues and with regard to the quantities
produced by the various types of mills within the project area. The
data developed indicated that 71 of the saw mills considered to be
large enough to justify debarker installations and the six pulp mills
operating in the study area could have generated an estimated 1,125,000
cubic yards and finewood residue materials in 1970 if all the
round wood processed had been debarked. The mills with debarkers Installed
in 1970 generated about 528,000 cubic yards of residue bark and an additional 335,800 cubic yards of finewood residues (sawdust
and shavings). The remaining indicated potential supply of residue
materials (261,200 cubic yards) is the residue materials that could
have been produced by those larger mills that had not installed debarking
equipment at the time the study was made.
The second phase of the project or marketing study developed
information regarding the market project area when used only as
mulches, soil conditioners, bedding, litter and for other closely
related type uses. The eleven user-groups contacted in the marketing
survey represented approximately 7,300 potential marketing outlets
for these materials. This figure excludes the livestock producers.
The eleven user-groups surveyed used and/or sold approximately
2,902,000 cubic yards of all types of mulching materiasl in 1971.
It was estimated the twelfth user-group considered (all Commercial
livestock producers) uses an additional 26,000,000 cubic yards of
bedding and litter materials annually.
By applying estimated replacement ratios of wood residue products
for the various other types of materials now used and/or sold by these
various user-groups, it appears a market potential of approximately
1,979,000 cubic yards of wood residue products could be developed
in the marketing area. This indicates that potential markets in excess
of the quantities of bark and wood residue generated by the primary
wood using industries can be developed over the next five to seven
The third phase of the study examined, through operational
analysis procedures, the economic aspects of processing and distributing residue products from eight assumed processing sites to
nine major marketing points within Illinois. The MPS/360 linear
programming routine (6), a basic cost minimization procedure, was
modified to develop a profit maximization model. The purpose was to
determine what the optimum flow of the various types of residue
products would be from the eight assumed processing points (including
external sources) to the nine marketing points selected in the study
area. Various spacial analyses were made wherein the objective
functional elements of the matrix (production costs, transportation
costs and product selling prices) as well as flow constraints were
varied to demonstrate the sensitivity of optimum flow solutions to
these variable cost and price elements.
Spacial Analysis IV indicates all residue materials in the
project area could be dispersed profitably if the average delivered
prices of $11.88 per cubic yard for bagged mulches, $6.72 per cubic
yard for bulk processed bark and $3.25 per cubic yard for bedding
and litter prevail.
Returns of approximately $5,500,000 would accrue to the primary
wood processing firms participating in the production and distribution
of these residue products, 34 percent of which would derive from
sources outside the project area.
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