System Dynamics Model Helps Optimize Fertilizer Stocks Amid Shipping Delays in Sulawesi
A new study by Fahri Anwar, Nurlaela, Andi Muadz Palerangi, and Achmad Romadin from Universitas Negeri Makassar (UNM), Indonesia, has demonstrated how system dynamics modeling can help fertilizer distributors maintain supply reliability while controlling inventory costs in Sulawesi. Published in 2026 in the International Journal of Global Sustainable Research (IJGSR), the research addresses a critical challenge facing Indonesia’s agricultural supply chain: uncertainty in fertilizer deliveries caused by maritime transportation disruptions.
The findings are significant because fertilizer availability directly affects agricultural productivity and food security. In island regions such as Sulawesi, where transportation networks rely heavily on shipping routes, delays caused by extreme weather, port congestion, and vessel scheduling issues can disrupt fertilizer distribution and threaten farming activities.
Why Fertilizer Distribution in Sulawesi Faces Unique Challenges
Sulawesi is Indonesia’s fourth-largest island and serves as a major economic hub in eastern Indonesia. However, its geography presents substantial logistics challenges. Mountainous terrain, long coastlines, and dependence on maritime transportation make the movement of goods particularly vulnerable to disruptions.
Previous supply chain studies have often focused on fluctuations in customer demand as the primary source of inventory uncertainty. The UNM researchers found that in Sulawesi’s fertilizer distribution system, uncertainty is driven more by delivery lead times than by demand changes. When ships arrive late, warehouses risk running out of stock even when demand remains stable.
For fertilizer distributors, maintaining sufficient inventory without creating excessive storage costs is a delicate balancing act. Too little inventory increases the risk of shortages, while too much inventory raises holding costs and reduces operational efficiency.
Using System Dynamics to Simulate Real-World Disruptions
To better understand this challenge, the researchers developed a System Dynamics model using Vensim simulation software. The model combined traditional inventory management calculations with dynamic simulations that replicate real-world disruptions.
The simulation incorporated several factors affecting fertilizer distribution, including:
- Vessel delays
- Port congestion
- Extreme weather events
- Inventory levels
- Service-level targets
- Reorder point policies
- Safety stock requirements
Rather than relying solely on historical averages, the model examined how inventory systems behave over time under different disruption scenarios.
Three inventory strategies were tested:
- Scenario 1: Aggressive Buffer Policy (99% service level)
- Scenario 2: Balanced Policy (95% service level)
- Scenario 3: Lean Logistics Policy (90% service level)
Each scenario used different safety factors to determine the amount of reserve inventory maintained in warehouses.
Safety Stock Increases Significantly Under Higher Service Targets
One of the study’s most important findings is that safety stock requirements rise substantially as organizations seek higher service reliability.
The simulation showed:
- Scenario 2 required approximately 28% more safety stock than Scenario 1.
- Scenario 3 required approximately 42% more safety stock than Scenario 2.
- Safety stock levels ranged from roughly 872–916 units in Scenario 1 to 1,588–1,668 units in Scenario 3.
These results demonstrate that maintaining higher service reliability in disruption-prone environments requires considerably larger inventory buffers.
The researchers found that safety stock acts as a critical protection mechanism against shipping delays and weather-related interruptions, helping prevent stockouts at regional warehouses.
Reorder Points Remain Surprisingly Stable
While safety stock levels changed dramatically, reorder point values remained relatively stable across all scenarios.
The differences in reorder points between the most conservative and most aggressive policies were less than 3%, indicating that reorder decisions are influenced primarily by demand during lead time rather than by safety stock adjustments.
This finding suggests that fertilizer distributors can improve resilience mainly by adjusting safety stock policies rather than completely redesigning their reorder systems.
Higher Reliability Comes With Modest Cost Increases
The research also examined the financial implications of maintaining larger inventory buffers.
Average monthly holding costs were:
- Approximately IDR 1.229 billion in Scenario 1
- Approximately IDR 1.241 billion in Scenario 2
- Approximately IDR 1.265 billion in Scenario 3
Compared with Scenario 1:
- Scenario 2 increased holding costs by only 0.98%
- Scenario 3 increased holding costs by approximately 2.93%
Although these percentages appear small, the researchers note that the cumulative annual impact can become significant. Even so, the relatively modest cost increases suggest that strategic inventory buffering may be a cost-effective way to improve supply reliability.
Balanced Policy Emerges as the Best Long-Term Strategy
The study identified a clear trade-off between operational resilience and inventory efficiency.
The Aggressive Buffer Policy provided the strongest protection against severe disruptions but required larger inventory reserves. The Lean Logistics Policy reduced inventory levels but left the system highly vulnerable to shortages during shipping disruptions.
The researchers concluded that the Balanced Policy, which targets a 95% service level, offers the most practical compromise between reliability and cost.
According to the authors from Universitas Negeri Makassar, the balanced approach maintains strong service performance while keeping inventory costs under control, making it the most suitable strategy for long-term fertilizer distribution in Sulawesi.
The model also demonstrated that overly lean inventory systems can amplify supply chain instability, particularly in regions where transportation disruptions are common.
Implications for Agriculture and Supply Chain Management
The findings have implications beyond fertilizer distribution.
Government agencies, logistics providers, agricultural cooperatives, and supply chain managers can use similar system dynamics approaches to improve inventory planning in regions facing transportation uncertainty.
The researchers recommend integrating:
- Real-time weather forecasting systems
- Port congestion monitoring
- Vessel tracking technologies
- Digital logistics platforms
Such tools would allow organizations to adjust safety stock levels dynamically based on disruption risks, improving supply chain resilience and reducing the likelihood of shortages.
For Indonesia’s agricultural sector, where timely fertilizer availability is essential for crop production, these improvements could strengthen food security and support sustainable economic development.
Author Profiles
Fahri Anwar – Researcher at Universitas Negeri Makassar specializing in logistics systems, inventory management, and supply chain optimization.
Nurlaela, M.Sc. – Lecturer and researcher at Universitas Negeri Makassar with expertise in industrial engineering, system dynamics, and operational management. Nurlaela served as the corresponding author of the study.
Andi Muadz Palerangi – Academic at Universitas Negeri Makassar focusing on logistics modeling, distribution systems, and industrial engineering applications.
Achmad Romadin – Researcher at Universitas Negeri Makassar whose work focuses on supply chain resilience, inventory planning, and operational performance analysis.
Source
Article Title: System Dynamics Modeling for Safety Stock Optimization Under Lead Time Uncertainty in Fertilizer Distribution: A Case Study in South Sulawesi
Authors: Fahri Anwar, Nurlaela, Andi Muadz Palerangi, Achmad Romadin
Journal: International Journal of Global Sustainable Research (IJGSR)
Year: 2026
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