Patent ID: 7873429

Claim:
A computer implemented method of controlling production within a network of production plants to produce and distribute a product to a network of customers, said method comprising: a) obtaining a plurality of planning data values for a given period of time, said planning data values including at least: i) a plurality of raw material cost structures for raw materials used in the production of the product, wherein each raw material cost structure specifies one or more parameters of a take-or-pay supply contract between a production plant and a raw material supplier; including at least one of a raw material price, a raw material quantity specified in the take-or-pay contract, a maximum contracted consumption rate, an energy adjustment, a series of prices based on quantity of usage, a forecast price for a raw material, and a spot price; ii) a value of one or more by-products for each of a plurality of production plants within said network of production plants, wherein each by-product results from processing the raw materials used in the production of the product, and wherein the value for a given by-products specifies a cost of processing that by-product; iii) a forecast consumption for each of said customers; iv) a forecast production availability for each of said production plants or a forced production plan; v) a production capacity for each of said production plants; vi) a cost of the product; vii) an availability of the product; and b) reading a plurality of current data values including at least: i) a real-time production rate for each of said production plants; and ii) a real-time consumption for each of said customers; and c) inputting said planning data values and said current data values into a production planning system; d) calculating from said inputted planning data values and said current data values: i) a total network variable cost, wherein the total network variable cost specifies: i) a plant production quantity; ii) a plant variable cost; iii) a total network production quantity; and iv) the total network variable cost; e) controlling production within the network of production plants by outputting a plant production quantity for each of said production plants on the basis of the total network variable cost.