In Ireland, dairy products are the largest product category exported with 34 % of total global trade, with the production of cheese accounting for over 800 million exports per year alone.
Cheese products are extremely vulnerable to Brexit due to the importance of trade with the UK. In Ireland, cheese will be most impacted by delays at ports caused by the potential reintroduction of customs or border controls.
To predict forthcoming changes related to Brexit and analyze their impact on the cheese supply chain in Ireland, a simulation model was built.
Simulation model for supply chain risk management
The supply chain risk management model focused on Roll-on/Roll-off (Ro/Ro) maritime transport connectivity between Ireland, the UK, and other EU member states. The dynamics of the freight flow in the supply chain were set based on the four main entities: products, trucks, ports, and vessels.
To develop the model, the research team used a combination of the agent-based and discrete event modeling approaches along with geographic information system (GIS) included in the simulation software AnyLogic 8.4.
Specifically, agent-based modeling was used for communication between the four main supply chain entities (products, trucks, vessels, and ports). On the other hand, discrete event modeling was applied for sequencing the procedures inside different agents of the supply chain network.
In total, 15 agents were used to mimic the flow of import and export products. They included suppliers (starting location of trucks), distributors (end location of trucks), and ports in Ireland and GB.
The aim of the supply chain risk management model built in AnyLogic software was to analyze and quantify the expected disruptions and delays at Irish ports after Brexit. The team also wanted to predict the impact on the cheese products flow between Ireland and the UK.
The model investigated three post-Brexit scenarios:
- Applying non-tariff barriers at Ireland’s and the UK’s ports.
- Replacing the UK Landbridge with direct maritime routes to mainland Europe.
- Lack of checking infrastructure at the UK ports and their impact on the transportation time and shelf life of the Irish cheese exported to the UK market.
The unclear situation at the border control posts in Ireland and the UK after the transition period undermines the ability of the Irish businesses to take effective decisions and make long-term plans about their supply chain designs.
A supply chain risk management simulation model could play a pivotal role to lift a segment of this uncertainty and provide decision-makers with better visibility to their supply chains and the related trade flow.
The model outcomes suggested that the Irish and EU negotiators needed to emphasize easing the non-tariff barriers at the UK ports and providing fast lanes (i.e., Green Route lane) for the trucks that carry limited shelf life and perishable products.
The model outcomes had also shown the importance of preparing a suitable checking infrastructure at the Irish and the UK ports before the end of the transition period.