Integrating stochastic programs and decision trees in capacitated barge planning with uncertain container arrivals

In this paper, we propose an approach that combines optimization techniques with machine learning to improve capacitated barge planning with uncertain container arrivals. The main idea is to use the predictions of a decision tree in the scenario generation of a 2-stage stochastic program to plan the barge calls (i.e. visits) of a barge operator. The predictions of container arrivals help to generate more accurate scenarios, which in turn leads to more informed decisions and less costs. The approach is tested with an iterative method of periodic planning and simulation for a one year duration so that the long term performance is evaluated. A computational experiment is conducted using the historical data of an inland terminal and the Port of Rotterdam. The results show that the proposed approach improves total costs up to 2.07% over the traditional stochastic approach, and up to 4.57% over the current method used in industry.