Experts explain feedstock supply chain intricacies

Biorefining Magazine
By Luke Geiver October 13, 2011

Ask J.D. Lindberg, principal and CFO for Resource Recycling Systems Inc., about the intricacies of feedstock supply contracting, and he would most likely tell you that “glass time is money.” Lindberg spoke during a feedstock supply discussion during the 2011 Northeast Biomass Conference & Trade Show, and to illustrate why some contracts work and others don’t, he explained the story of two biomass power facilities in Michigan that are only miles apart, “practically co-located,” he said, yet one has signed a much more favorable contract compared to the other. Why? Because, Lindberg said, the feedstock truckers for one company were more efficient at loading their woody biomass and could get in and out much quicker than the other facility’s transport team. Because of the ability of the quicker drivers, that particular plant was considered a preferred customer, or more favorable contractor, and earned a better price for its feedstock and supply agreement.

Add to all of that that an individual for the “preferred” facility was constantly in the field and in the surrounding communities working to promote it and educate others about it, and Lindberg was able to illustrate the intricacies of feedstock supply contracting to a level beyond just insinuating that long-term contracts and quality feedstock matter.

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