Production and distribution of polyvinyl chloride considering demands of warehouses

Abstract This paper deals with an integrated production and distribution of a chemical company who operates PVC plants with EDC and VCM processes. The problem is composed of two or more multi-site VCM and PVC plants, and several warehouses. There follows a case study. There are five domestic PVC plants and two are in abroad. More than 4-type PVC are produced in seven different plants and are supplied to fifteen warehouses. Eleven warehouses are domestic and the others are in abroad. The objective is defined as maximizing the net profit of the chemical company, i.e. the total expected selling price minus the production costs, the expected shipping costs and imported costs of insufficient EDC and VCM. Mixed integer linear programming (MILP) is presented to obtain an optimal production and distribution of PVC. The effectiveness of its application is illustrated with a case study. The problem is solved with CPLEX 7.0.0.