Syngenta Uses a Cover Optimizer to Determine Production Volumes for Its European Seed Supply Chain

Abstract

The European seed business of Syngenta relies on its supply chain to supply seed products to the different European markets, which led to more than 1.2 billion USD revenues in 2013. The seed supply chain is, however, exposed to a high level of uncertainty – from the demand side as well as from the supply side. Determining optimal production volumes in a highly volatile environment and more than one year before the sales period is not only a complex business decision but also one which strongly affects the company’s profitability through lost sales and unsold supply. In order to better handle the production volume planning, Syngenta has developed a planning tool which determines optimal production volumes by taking the different levels of uncertainty into account. We report on this tool, the impact it has achieved, its integration into the planning process at Syngenta, and its technical design. In 2013, its first year of application, the production optimization tool has already avoided approximately 1.5 million USD in supply discards and has led Syngenta to revise the way how it handles uncertainty in its supply chain planning.