A Local Biomass Processing Depot (“depot”) is a facility that first pretreats cellulosic feedstocks and then densifies (pelletizes) the pretreated feedstock. The depot facility is geographically isolated from the biorefinery and instead is located near feedstock production areas. In this example, the depots use the ammonia fiber expansion (AFEX™) process with subsequent pelleting to pretreat and prepare cellulosic biomass (as exemplified by corn stover and switchgrass) for hydrolysis and fermentation to fuel ethanol at biorefineries or for direct consumption by ruminant animals as enhanced animal feeds. Multiple small depots in the local network system (100 – 200 dry tons/day) supply feedstock to a large biorefinery (≥ 15,000 dry tons/day). We investigate the potential of co-locating depots at existing grain elevators across a 10 state region in the U. S. Midwest. Depots co-located at grain elevators can take advantage of existing infrastructure to minimize the capital investment required. Biorefineries are assumed to be co-located at coal-fired power plants. Nine power plants near large cities (e.g., Chicago, Detroit, etc.) are selected as potential biorefinery locations. The biomass supply chains for each biorefinery in the depot system are determined by minimizing ethanol selling price. Greenhouse gas emissions associated with each biomass supply chain are estimated. Each biomass supply chain is also evaluated in terms of ethanol volume, ethanol selling price and greenhouse gas emissions to determine its appropriateness for the depot system. Different options for incentivizing farmer participation in the biomass supply chains, including ownership of the depots, are explored as well.