Location Selecting for Agricultural Cooperative under the P-Median Model to Establish a Transportation Center for Oil Palm A Case Study: Phang Nga Province, Thailand
Recently, the process of selling and buying oil palm in Thailand starts from farmers selling their yield to a buying point, either the nearest one or the best price offered one. The buying point takes the role of a middle man who will later sell the collected fruit to factories. This selling and buying procedure has some drawbacks to both the farmers and the factories. For example, the farmers sell their products at a low price while the factories might get low quality product which affects the quality of oil palm. So, this research proposes opening an oil palm transportation center to create fair trade. At this center, oil palm will be priced through an auction which can help increase the value of the fruit and give more benefits to farmers while factories themselves will be assured to obtain quality checked oil palm. The purposes of this study are to find appropriate locations for oil palm transportation centers and to arrange farmers into groups for each center in Phang Nga province, Thailand. This is to lower total transportation costs, including expenses in transportation and the cost of vehicle depreciation. The studied problem type is P-median and the first step is to determine a number of transportation centers, depending on the amount of oil palm in the whole and the conditions of transportation and then find proper locations for transportation centers from 6 existing agriculture cooperatives which will serve farmers in 16 sub-districts. The result shows that there are 4 existing agriculture cooperatives suitable for opening a transportation center. The 4 cooperatives are cooperatives 2, 3, 5, and 6, having the amount of 166,350 kg, 187,558 kg, 157,085 kg, and 183,238 kg of oil palm respectively. Also, the total transportation distance of the 4 cooperatives is 46.71, 538.27, 328.35 and 227.85 km respectively. It is also found that cooperative 2 gathers oil palm from farmers in sub-districts 11, 12, 14, and 15 while cooperative 3 collects their fruit from farmers residing in sub-districts 2, 3, 6, 8, 9, and 10. Cooperative 5 obtains oil palm from farmers living in sub-districts 2, 4, 7, 13, and 16 when cooperative 6 has their oil palm from farmers in sub-districts 1, 3, 5, 6, 9, and 10. Moreover, the finding shows that the total cost in the whole transportation system is 45,131.46 baht, the total transportation system is 1,141.18 km, and the total amount of transported oil palm is 694,231 km.
Keywords - P-median, Facility Location Problem, Oil Palm, Mathematic Model