A Co-Opetition Straw Supply Strategy Integrating Rural Official Organizations and Farmers’ Behavior in China

Abstract

China has a huge potential of biomass power generation since it is a big agricultural producer and abundant in agriculture straw. However, the current straw supply system cannot guarantee the feedstock sufficiency for biomass power plants. The main reason is the high costs of straw collection and transportation because farmers are scattered across the country and farming in a small-scaled method for self-support. This study aims at solving the issue with the introduction of China’s rural official organizations to collect agriculture straw in a centralized way and to share benefits with farmers. We apply the approach of multi-agent modeling and simulation to analyze the farmer’s participation behavior within a co-opetition supply strategy after the rural official organizations are incorporated. The results demonstrate that farmers’ participation is positively affected by the cooperative enthusiasm of rural official organizations. In addition to those basic factors, such as straw price, transportation cost, and shipping distance, the benefit sharing policy has a significant impact on the equilibrium percentage of the cooperative farmers. We recommend that the Chinese central government encourage and support rural official organizations to participate in the agriculture straw supply chain, and the benefit sharing policy should be implemented with the precaution against free rides.