Supply Chain Uncertainties of Small-Scale Coffee Husk-Biochar Production for Activated Carbon in Vietnam

Abstract

Between 2014 and 2019, an innovative small-pyrolysis system (the PPV300) using agrowaste as feedstock was transferred and adapted from Switzerland to Vietnam by a United Nations Industrial Development Organization (UNIDO) project. The coffee husk resulting from the processing of coffee beans is usually disposed of in Vietnam or burned inefficiently to dry coffee beans. Small-scale pyrolysis of coffee husk using the PPV300 avoids smoke emissions and local air pollution while providing an energy source for coffee drying and biochar as a by-product. This paper investigates the uncertainties in the “coffee husk to activated carbon” supply chain in Vietnam and discusses the pros and cons of different supply chain setups using a framework derived by Chopra and Meindl (2013). According to the analysis, a number of actors (an intermediary without previous direct involvement in the coffee supply chain, a coffee processor, or a hybrid between farm and processor), each with advantages and disadvantages, would be suitable from a supply chain perspective to attain an efficient strategy that would keep the price of the biochar low. However, in order to be attractive for one activated carbon producer, several PPV300 systems are needed to reach a significant economy of scale. Sufficient husk sourcing and storage capacity is also needed. If the purpose is simply to produce biochar for activated carbon, processors and intermediaries could consider a simpler and cheaper design than the PPV300. In conclusion, supply chain uncertainties and economic viability can be optimized when the PPV300 is used by coffee processors or intermediaries, who are able to make use of the co-products generated (biochar, heat, and wood vinegar). In addition to its financial viability, all of the other co-benefits of this technology should be taken into consideration (reduced smoke and environmental pollution, avoided health costs, greenhouse gas savings, etc.) for a proper assessment of its economic attractiveness.