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    Steel Saving For L&T

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    This document analyzes options for optimizing scrap levels in steel bar production. It examines producing bars in standard stock lengths of 7-12 meters and 7-18 meters to meet a minimum order of 200 tons. It also considers a minimum order of 150 tons. The best results are from combining order lengths and quantities, achieving a scrap level below 3% at 1.407% total tons and a cost of 13.26 lacs. The conclusion recommends negotiating a lower minimum order of 150 tons and paying any premium for bars not meeting that quantity.

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    Steel Saving For L&T

    Uploaded by

    rssdpm
    42 views13 pages
    This document analyzes options for optimizing scrap levels in steel bar production. It examines producing bars in standard stock lengths of 7-12 meters and 7-18 meters to meet a minimum order of 200 tons. It also considers a minimum order of 150 tons. The best results are from combining order lengths and quantities, achieving a scrap level below 3% at 1.407% total tons and a cost of 13.26 lacs. The conclusion recommends negotiating a lower minimum order of 150 tons and paying any premium for bars not meeting that quantity.

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    Steel Saving for L&T

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    This document analyzes options for optimizing scrap levels in steel bar production. It examines producing bars in standard stock lengths of 7-12 meters and 7-18 meters to meet a minimum order of 200 tons. It also considers a minimum order of 150 tons. The best results are from combining order lengths and quantities, achieving a scrap level below 3% at 1.407% total tons and a cost of 13.26 lacs. The conclusion recommends negotiating a lower minimum order of 150 tons and paying any premium for bars not meeting that quantity.

    Copyright:

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    Download as PDF, TXT or read online from Scribd
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    42 views13 pages

    Steel Saving For L&T

    Uploaded by

    rssdpm
    This document analyzes options for optimizing scrap levels in steel bar production. It examines producing bars in standard stock lengths of 7-12 meters and 7-18 meters to meet a minimum order of 200 tons. It also considers a minimum order of 150 tons. The best results are from combining order lengths and quantities, achieving a scrap level below 3% at 1.407% total tons and a cost of 13.26 lacs. The conclusion recommends negotiating a lower minimum order of 150 tons and paying any premium for bars not meeting that quantity.

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    of 13

    SCRAP MINIMIZATION TO

    3% OF MATERIAL COST
    RGS CONSTRUCTION TECHNOLOGIES
    PRIVATE LIMITED
    INDIA

    OBJECTIVE OF THE EXERCISE

    OBJECTIVE FRAMEWORK

    SCRAP OPTIMIZATION
    12 METER STOCK
    Bar

    DETAILED

    Tonnes

    Tons

    Optimised

    Off
    Cuts

    % on Detailed

    Ref

    Numbers

    Scrap

    Off
    Cuts

    Scrap

    Total

    T 16

    56,512

    335

    339.00

    1.32

    2.34

    0.39

    0.69

    1.08

    T 20

    26,194

    503

    734.00 230.33

    0.73

    31.38

    T 25

    18,242

    269

    279.00

    6.31

    3.32

    2.26

    T28

    2,640

    82

    94.50

    11.07

    1.67

    11.71

    1.77 13.48

    T32

    3,048

    189

    217

    26.71

    1.52

    12.31

    0.70 13.01

    Total Tons

    1378

    1663.50 275.74

    9.58

    16.58%

    0.58%

    0.10 31.48
    1.19

    3.45

    17.16%

    ACHIEVEMENT OF OBJECTIVE

    ANALYSIS
    STANDARD STOCK LENGTH OPTION
    ON A BAR-WISE BASIS IT MAY BE PERTINENT TO MENTION THAT THE MINIMUM
    ORDER OF 200 MTS IS NOT ACHIEVED ONLY IN THE CASE OF T28 & T32 BARS.
    THIS IS PRIMARILY BECAUSE THE REQUIREMENT FOR THESE BARS IN THE TOTAL
    QUANTITY OF 1378 TONS, IS ITSELF LESS THAN 200 MTS 82 MTS & 189 MTS FOR T28
    & T32 RESPECTIVELY.
    SCRAP HAS BEEN OPTIMISED TO THE LOWEST LEVEL. ANY ATTEMPT TO REDUCE THE
    OFF-CUT GENERATED RESULTS IN AN INCREASE IN THE SCRAP LEVEL PERCENTAGE
    HOWEVER AN ATTEMPT HAS BEEN MADE TO OPTIMISE Off CUTS GENERATED BUT AT
    THE SAME TIME TO KEEP THE SCRAP LEVEL AT 3% OR BELOW
    THE ATEMPT WAS LEVEL SIMULTANEOUSLY OPTIMISE THE OFF CUTS AS WELL AS THE
    SCRAP LEVEL THROUGH THR ROUTE OF MILL ORDERS.

    MILL - SIDE CONSTRAINTS

    OPTION 1 - MILL ORDER


    WITH BAR LENGTHS 7 M TO 12 M
    MINIMUM ORDER 200 MTS
    Bar
    Ref
    T 16
    T 20
    T 25

    To Order
    Numbers

    Tonnes

    Tons

    Cost
    Rs. Lacs

    Off
    Cuts

    % on Detailed
    Scrap

    Off
    Cuts

    Scrap

    Total

    0.39

    0.69

    1.08

    8.08

    2.72

    10.80

    17,857

    339.00

    169.50

    1.32

    2.34

    8,064
    16979

    239.00
    325.00

    119.50
    162.50

    45.57

    15.34

    746
    5540

    34.50
    239.00

    17.25
    119.50

    1.04

    2.95

    0.38

    1.08

    1.46

    1,630

    94.50

    47.25

    11.07

    1.67

    11.71

    1.77

    13.48

    2,868

    217.00

    108.50

    26.71

    1.52

    12.31

    0.70

    13.01

    5.76

    1.60

    7.36

    (12m)

    (12m)

    (12m)

    T 28

    (12m)

    T 32

    (12m)

    Total Tons
    Value in

    Rs. Lacs

    OPTION 2 - MILL ORDER


    WITH BAR LENGTHS 7 M TO 18 M
    MINIMUM ORDER 200 MTS
    Bar
    Ref
    T 16
    T 20

    T 25

    To Order
    Numbers

    Tonnes

    Tons

    Cost
    Rs. Lacs

    Off
    Cuts

    % on Detailed
    Scrap

    Off
    Cuts

    Scrap

    Total

    (12m)

    17,857

    339.00

    169.50

    1.32

    2.34

    0.39

    0.69

    1.08

    43.00
    (14950)5,946
    (17700)6,608

    1.00
    220.00
    289.00

    0.50
    110.00
    144.50

    3.26

    3.32

    0.64

    0.65

    1.29

    746
    5540

    34.50
    239.00

    17.25
    119.50

    1.04

    2.95

    0.38

    1.08

    1.46

    1,630

    94.50

    47.25

    11.07

    1.67

    11.71

    1.77

    13.48

    2,868

    217.00

    108.50

    26.71

    1.52

    12.31

    0.70

    13.01

    3.03

    0.82

    3.87

    (12m)

    (12m)

    T 28

    (12m)

    T 32

    (12m)

    Total Tons
    Value in

    Rs. Lacs

    OPTION 3 - MILL ORDER

    BAR LENGTHS 7 M TO 12 M & MINIMUM


    ORDER 150 MTS
    Bar
    Ref
    T 16
    T 20

    T 25
    T 28
    T 32

    To Order
    Numbers

    Tonnes

    Tons

    Cost
    Rs. Lacs

    Off
    Cuts

    % on Detailed
    Scrap

    Off
    Cuts

    Scrap

    Total

    17,857

    339.00

    169.50

    1.32

    2.34

    0.39

    0.69

    1.08

    1,154
    17188
    6838

    34.00
    329.00
    176.00

    17.00
    164.50
    89.76

    17.89

    18.27

    3.32

    3.39

    6.71

    746
    5540

    34.50
    239.00

    17.25
    119.50

    1.04

    2.95

    0.38

    1.08

    1.46

    1,630

    94.50

    47.25

    11.07

    1.67

    11.71

    1.77

    13.48

    432
    2436

    33.00
    168.00

    16.50
    85.68

    4.26

    7.06

    2.13

    3.53

    5.66

    2.46

    2.23

    4.67

    (12m)

    (12m)

    (12m)

    (12m)

    (12m)

    Total Tons
    Value in

    Rs. Lacs

    COMBINED MILL ORDER BAR LENGTHS


    BEST RESULTS
    Bar
    Ref
    T 16

    To Order
    Numbers

    Tonnes

    Tons

    Cost
    Rs. Lacs

    Off
    Cuts

    % on Detailed
    Scrap

    Off
    Cuts

    Scrap

    Total

    (12m)

    17,857

    339.00

    169.50

    1.32

    2.34

    0.39

    0.69

    1.08

    43.00
    (14950)5,946
    (17700)6,608

    1.00
    220.00
    289.00

    0.50
    110.00
    144.50

    3.26

    3.32

    0.64

    0.65

    1.29

    T 25

    746
    (11200)5540

    34.50
    239.00

    17.25
    119.50

    1.04

    2.95

    0.38

    1.08

    1.46

    T 28

    108
    (11650)902
    (9450)620

    6.00
    51.00
    28.00

    3.00
    26.01
    14.28

    3.37

    0.18

    3.97

    0.21

    4.18

    432
    (10900)2436

    33.00
    168.00

    16.50
    85.68

    4.26

    7.06

    2.13

    3.53

    5.66

    Total Tons 1,407.50

    706.72

    13.26

    15.85

    0.94

    1.13

    2.06

    T 20

    T 32

    (12m)

    (12m)

    (12m)

    (12m)

    ACHIEVEMENT OF OBJECTIVE

    OUR CONCLUSION
    1.

    NEGOTIATE MINIMUM ORDER QUANTITY TO


    150 TONS.

    2.

    PAY THE PREMIUM ON THE BARS NOT


    MEETING THE MINIMUM ORDER QUANTITY
    OF 150 MTS
    OR
    IF POSSIBLE, SHIFT THIS TONNAGE TOANOTHER
    STEEL MILL AT A LOWER / NO PREMIUM

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