In a competitive market, customer focus is key to success. Our ambition is to become our customer’s preferred supplier in terms of service and quality. To achieve this, it is important to have uniform and sustainable systems and processes for the launch of orders, planning, follow-up, transport, and quality of our finished products.
Customer Service serving the customer in a significantly changing economic climate
The overall consequences linked with the pathway to carbon neutrality have a significant impact on us as a steel producer, as well as on our customers, leading to a search for a new operational equilibrium. Electrification among our automotive customers, along with a general trend towards greening among our industrial customers, is causing shifts in order volumes and mixes as well as in transportation modes. Furthermore, we have been facing major disruptions in production lines in Europe, both within and outside the ArcelorMittal group for some time, resulting in important disturbances in the supply to our customers.
This has led to a nervous and unstable supply chain. Despite these challenges, we were able to navigate through this situation. Within the ArcelorMittal Belgium cluster, we have backup options for most of our products in case of disruptions in customer supplies, and we can also rely on support within the ArcelorMittal group when backup is needed.
Within these circumstances, ArcelorMittal Belgium remains capable of continuing product innovation and offering new products with optimal service: expanding Magnelis® and Optigal® capacity, developing advanced high-strength steels for the automotive sector, deliveries of advanced organic coatings and further expanding our Xcarb®-related shipments to support the journey towards carbon neutrality.
Effectively and efficiently managing these deliveries on time and in the right manner is crucial for the customer service department.
Cluster logistics runs smoothly
The logistics optimization program, launched in 2019, was continued in 2022 and 2023. In the Ghent cold rolling mill, the stock capacity for annealing was expanded by approximately 8.5 kt, allowing for less internal destocking and standstills due to limited logistics.
For deliveries to Eurogal in Liège, the intermediate stock was excluded by introducing direct trains between Ghent and Eurogal. In 2022 and 2023, direct supply to Eurogal results were further improved (reaching 85% of direct supply in 2023) after putting in place a new delivery schedule by rail. In Liège, the Eurogal stock redesign was completed, allowing an additional 950 coils to be stored and kept internally to avoid external storage activity and costs. Also in Ramet, some extra storage capacity (230 coils) was created (former Arceo hall + H15). In Genk, the former ArcelorMittal Tailored Blanks hall has become a full Sikel storage hall, resulting in smoother internal storage performance and avoiding the need for external destocking.
The implementation of the Genesis (warehouse management system) at the Eurogal and Kessales sites in Liège (as Geel in place in Ghent, Genk, and Geel ) was finalized. The Ghent-Liège supply by rail was boosted to 96% by rail in 2023, despite worsening rail tariff conditions.
New procedures were put in place to plan maintenance in shipping halls better aligned with shipment needs – e.g. to avoid urgent material ending up in halls out of service. The supply chain transport & logistics team, together with Purchasing, significantly reduced the extra costs on truck shipments thanks to new contracts, higher contract fulfillment, and a more flexible way of chartering trucks (‘best carrier’ process).
Primary Route Usage has improved slightly from 78.8% to 80.6%, mainly after intense follow-up of some barge and maritime regular routes.
With automation programs starting in 2024 in the shipping halls of Eurogal (H52), Kessales (K2), and Ghent (UV), including automatic loading and unloading of railcars, the ambition to further improve storage and handling performance in 2024 is demonstrated. Also thanks to a new transport management system (Sultan project / introducing the Oracle TM package) ‘coming soon’ (2024-2025), we shall continue external logistics optimization in the coming years.
Together with Ghent and Antwerp University and IMEC or VIL research institutes, we explored some innovative ideas for better logistics organization thanks to data spacing and federated information sharing.
Scale-up (Supply Chain, Quality Chain, European Project)
The Scale-up (Supply Chain,QualityChain, European Project) project of ArcelorMittal Europe – Flat Products steers the strategic processes in the field of supply chain and quality. Our cluster ArcelorMittal Belgium is piloting the next major subproject, Sultan. Sultan (=ScaleUp Logisticsand TransportApplicatioN) will replace the current Transport Management System ‘ISLA’ within ArcelorMittal Belgium, and in the meantime serve as a template for ArcelorMittal Europe – Flat Products. The core role of Sultan is to plan the transport needs for supply chain transport in a cost-efficient way, with as little manual intervention as possible by the transport & logistics department. The rollout of the Sultan project Belgium started at the end of 2023. The rollout is divided into three release phases: release 1 will cover truck transport between the different sites of the ArcelorMittal Belgium cluster, release 2 will then cover all other truck logistics, and release 3 will cover the other modes of transport (train, vessel, and barge). The deadline for the entire program is the end of the first quarter of 2026.
The ongoing challenge of guiding our products through the production chain on time and in full
We further optimize our scheduling systems to guarantee an optimum flow of our products through our installations. New innovation products, such as ultra-high-strength steels, require more complex routings, which of course makes it more difficult to schedule the different production steps, ensuring the shortest possible and most reliable lead time for our customers. Products have to be produced in specific campaigns more frequently, such as Magnelis® and Optigal®, again limiting the freedom of scheduling our production chain. We continuously aim for the perfect equilibrium between service and production costs when making production planning, assisted by our dedicated IT tools such as line scheduling, multi-day, and campaign planning software. The next big challenge ahead for production planning and scheduling will be the completely new primary production route with the DRI/EAF installation.
In the meantime, we have developed an external supply route from the Sestao EAF production facility in Spain to further process their hot-rolled coils into finished products at our finishing facility in order to meet our customers' demand for green steel (XCarb®).
Towards more ‘green’ modes of transport
A European program to prepare the ArcelorMittal Supply Chain organization and the commercial organization (CMO) towards organizing, selling, and reporting on green(er) transport solutions was initiated in 2023. Modal shift towards greener solutions, finding new transport solutions, and 'greening' existing solutions (e.g., electrify) shall be key elements in lowering our transport ecological footprint. In this respect, a full delivery by electric truck lane was installed between Gent and Moerdyck and some first tests on using HVO fuels on truck transports are explored. We are also aiming to stop the downward trend in rail transport by using more rail operators and optimizing our proper 'Steeltrack' railcar fleet usage, using it on a European scale.
