This paper presents numerical and experimental investigations of complex and interrelated physical and chemical phenomena that occur during combustion of baled soybean residue in the furnace with the cigarette type of combustion. The result of comprehensive research is reactive flow model of biomass combustion inside furnace. Model is described by set of partial differential equations which define momentum, heat and mass transfer processes in porous and fluid system. The main aim of developed CFD model is numerical simulation of combustion process inside the cigarette furnace. It is also used to provide deeper insight in complex processes occurring during biomass combustion. Verification of proposed numerical model was performed through comprehensive experimental tests on the experimental-industrial plant of 1.5MW boiler for heating the greenhouses in the “Agricultural Corporation in Belgrade”. The tests included measurement of flow rate and air and flue gas temperature input and output values on the furnace that are taken as the boundary conditions of the developed model. Comparison of the experimental results shows satisfactory agreement with numerical results (the maximum relative deviation of calculation and measurement temperatures are 10-45%), therefore the developed mathematical model could be used to analyse the effects of structural and parametric (fuel composition, power rate, air excess etc.) changes of the facility, from the standpoint of energy efficiency and ecology. [Projects of the Serbian Ministry of Education, Science and Technological Development, Grant no. III 42011: Development and improvement of technologies for energy efficient and environmentally sound use of several types of agricultural and forest biomass and possible utilization for cogeneration and Grant no. TR33042: Fluidized bed combustion facility improvements as a step forward in developing energy efficient and environmentally sound waste combustion technology in fluidized bed combustors]