Sustainable Supply Chain Practices to Decarbonise Steel Industry AMNS

Sustainable Supply Chain Practices to Decarbonise Steel Industry by AM/NS India CASE STUDY

In this post, I am covering some of the best Sustainable Supply Chain Practices to Decarbonise Steel Industry by AMNS India (ArcellorMittal Nippon Steel India).

This is a Case Study on AMNS India, in which I have covered 3 topics.

1. Sustainable Supply Chain practices implemented by AM/NS India to decarbonise the steel industry.
2. Additional Sustainable Supply Chain Practices for Large Scale Heavy Manufacturing Industries to reduce Carbon Footprint/Net Zero CO2 emissions.
3. Benefits of Building a Sustainable Supply Chain Nowadays.

Sustainable Supply Chain practices implemented by AM/NS India to decarbonise the steel industry

AMNS India is a joint venture (60:40) between ArcellorMittal and Nippon Steel Corporation. AMNS India acquired Essar Steel India Limited (ESIL) in 2019. Since then AMNS have acquired several manufacturing, power and infrastructure facilities to strengthen their entire supply chain.

Slurry Pipelines for transporting Iron Ore

AM/NS has an iron ore mine in Sagasahi and a Beneficiation plant in Dabuna, both of them located in the state of Odisha. Right now the iron ore is being transported through trucks on the road.

Problems faced in transporting the Iron Ore via road.

• Transportation of Iron Ore through Roads causes heavy environmental degradation which is difficult to measure.
• Diesel powered trucks have high maintenance cost and their co2 emissions are way to high.
• During rains, it gets more difficult to transport the Iron Ore through trucks, as they are not covered from the top, damaging the material in transit.

But once the construction of the Slurry pipeline is completed from Sagasahi to Dabuna, trucks would not be needed anymore. These pipelines will easily transport the iron ore from point A to point B. Weather can no longer have any effect on slurry pipelines. The cost of transportation gets reduced significantly and so does the carbon footprint.

This project by AMNS India has safely secured the interest of all community concerns, while safeguarding the environment.

Just one question though.

What will happen to the trucks or the truck drivers who will not be needed anymore, once the construction of the slurry pipelines gets completed?

I hope AMNS India has planned something good for them too in the future.

Using Riverine Jetty instead of Trucks

Proposed to build a riverine jetty at the banks of the river Mahanadi. It will have an output of 4.5 MTPA, with a total cost of Rs 156.85 crore. The riverine Jetty will be close to the Pellet Plant and thermal power plant.

This jetty will then be used to transport the imported raw materials from the Paradip port to the pellet plant and outbound material from the pellet plant to the Paradip port. This will eliminate the need for trucks and reduce the carbon emissions.

The company also says that this project will create more than 300 jobs.

Riverine Jetties are good for transporting bulk cargo and are really the cheapest mode of transport.

Using Renewable Energy to Power Low Carbon Steelmaking

ArcellorMittal is the parent company of AM/NS India (ArcellorMittal Nippon Steel India). ArcellorMittal have partnered with Greenko Group, who will design, build and handle a renewable energy power project.

The project will include solar power, wind power and Greenko’s supported Hydro Pumped storage. It will have a nominal capacity of 975 MW.

AMNS India has entered into an agreement with ArcellorMittal for 25 years, in which AMNS will receive 250 MW renewable energy annually. And this 250 MW will cover 20% of the actual electricity demand at their Low Carbon Steel Making plant in Hazira, Gujarat.

This Renewable energy will reduce the carbon emissions at AMNSIndia by 1.5 Million Tonnes per annum.

Other Benefits include:

• Reduced electricity cost for the company.
• Creates more jobs than fossil fuel energy industry.
• A source of energy that can never run out, Wind and Sun.
• Promotes sustainable means of manufacturing steel operations.
• Reducing the use of Coal with Industrial LNG.

AM/NS India partnered with Total Energies (Paris) to supply 5 hundred thousand tons of Industrial LNG annually, till 2026.

LNG will now be used to run their steel plants and power plants in Gujarat.

Industrial LNG will not completely replace the use of coal but will definitely reduce the dependency on coal. Thereby, reducing carbon emissions significantly, if not completely.

Coal is basically a non-renewable form of energy. There are large reserves of coal globally, but it still degrades the environment.

Using Steel Slag to prevent Coastal Erosion

Coastal Erosion is a natural phenomenon and it causes loss to the land. Very often, to prevent coastal erosion, concrete blocks or concrete tetrapods are placed along the coastline because of their high density.

80 percent of the raw material used in these tetrapods or blocks is sand and granite stone chips.

AM/NS India took this opportunity in an effort to push their companies sustainable manufacturing practices. And they have started processing their steel slag into fine and coarse forms. These processed steel slags are now being applied in manufacturing the high density coastal tetrapods as a complete replacement for sand and stone chips.

Using Steel Slag to build Roads

Firstly, for those of you who don’t know what a steel slag is. Steel slag is a by-product or waste generated after the molten steel gets separated from its impurities in steel-making furnaces.

AMNS India generates a total of 2.5 MTPA of steel slag. In Gujarat, the company has used 1 lakh tonnes of processed steel slag to construct a 1.2 km road with six lanes.

Further, today steel slags can be used as an alternative to filler in filling road pavements, in construction material to replace concrete and its powdered form can be used as a fertiliser in agriculture industry.

Additional Sustainable Supply Chain Practices for Large Scale Heavy Manufacturing Industries to reduce Carbon Footprint/Net Zero CO2 emissions

1. Redesigning the entire Logistics from the start of the supply chain to the end. Replace all the diesel powered trucks with electric trucks. Have an electric charging infrastructure in place for company vehicles.
2. Switch completely to Renewable Source of Energy, that is Wind Energy and Solar Energy. Deploy the use of renewable sources of energy in the entire supply chain, from manufacturing plant to warehouse to distribution centre to company owned retail outlets.
3. Monitor, track and trace the waste generated at the production site, manufacturing plant, warehouses, distribution centres and the scrap generated after the entire life cycle of the steel products. And reuse or recycle them.
4. Build a water management system and limit the usage of water at all the facilities. Also, install meters to track the usage of water in the company.
5. Use rail transportation instead of road wherever possible, and use water transport instead of rail wherever possible.

Benefits of Building a Sustainable Supply Chain Nowadays

1. Reduction in costs across the entire supply.
2. Reducing the dependency on fossil fuels, helps in reducing the carbon emissions.
3. Helps you position your brand in the eyes of your customer. Today, customers are more concerned about how everything is being produced whatever they are consuming.
4. The capital expenditure may increase in the beginning, but these investments are going to create long term benefits.
5. Creates transparency across your entire supply chain, thereby enhancing your brand reputation.
6. Less damaging to the environment.
7. More energy efficient operations and generates less waste.

So, this was my post on the best Sustainable Supply Chain practices to decarbonise the Steel Industry by AM/NS India.

I hope you enjoyed reading this post. If you have any questions or request, please feel free to comment down below.

THANK YOU. 

What is the Starting to End process for Warehouses in Logistics?

From starting to the end, there are a total of 6 processes in the warehouse in Logistics. The First Warehouse process is the Receiving process, second is Put-Away process, third is Storage process, fourth is Picking Process, fifth process is Packing and the End process is Shipping Process.

This below given flowchart will help you understand the flow of all the warehouse processes, before you can get into the in-depth detail.

Now, let's understand each of the six warehouse processes from starting to the end in detail.

1. Receiving Process
2. Put-Away Process
3. Storage Process
4. Picking Process
5. Packing Process
6. Shipping Process

Step 1 - Receiving Process

Receiving process means to receive the Right Product, in the Right Quantity, in the Right Condition and at the Right Time. This is the starting process for Warehousing in Logistics and the most important process.

You cannot go wrong here. In this process, the title of ownership of the items gets transferred to the warehouse. So, it is the responsibility of the warehouse to keep the items in the right condition, before they are delivered to your end customer or to whoever is next in line in your supply chain.

Proper receiving of the items will help you to escape the responsibility of the faulty items and thus avoiding the liability. Start by checking that proper documentation is there along with the items you are receiving. Accuracy in this first step will have a direct impact on the accounting and payout of your goods.

If you fail to identify the faulty items in this first step of Receiving, then your business will end up paying for the faulty items not the manufacturer of the items.

Many Warehouses have equipped themselves with equipment like Package Dimensioner. It helps you to capture the dimensions of the entire package and the weight of the package as well.

Step 2 - Put-Away Process

In this warehouse process, you put away the items which are successfully received at the receiving dock, to the most optimal warehouse storage location.

So you are just moving the goods from the dock to the storage location in this process. But, choosing a poor storage location can hamper the productivity of your warehouse operations entirely.

There are benefits of choosing the most optimal storage location to put away.

• Your cargo gets stored faster and efficiently
• Your travel gets reduced
• You can easily find, track and retrieve for the picking the item
• Safety of all the employees is ensured if done correctly
• Warehouse space utilisation is ensured

Technological Applications like Space Management System, and Put-away mobile applications, finds the most optimal space for the cargo that will help you to build streamlined operations and will ensure maximum space utilisation.

Step 3 - Storage Process

In this warehouse process, as the name suggests, items or goods or cargo is stored in their most appropriate storage space.

Proper storage space utilisation can easily increase your labour efficiency. Right warehouse storage system will help you to utilise the horizontal and vertical spaces in the warehouse.

An efficient storage process is necessary to ensure that you are making full use of all the available space in your warehouse.

You can take the following steps while optimising the storage process in the warehouse.

• Reduce the unnecessary Aisle space
• Invest in the Right Warehouse Storage System
• Pick the right storage method for your Warehouse facility

Step 4 - Picking Process

In this warehouse process, you pick the items from their storage location to fulfil the customer orders.

This is the costliest process in the warehouse. It accounts for 55% of the total operating expenses in the warehouse. You will have to choose the right picking method depending on your warehouse facility.

By optimising this process, you can easily reduce the operating costs significantly and increase your warehouse efficiency.

• Invest in proper wireless networking solution in your entire warehouse
• Deploy technology wearable by the clerks
• Wirelessly view the order picking lists
• Scan the warehouse from time to time
• Access systems in real time

You must always keep in mind that not all orders are created equally and this is why it is important to choose the right picking method in your warehouse. Some order must be prioritised over the others.

• Always be wary of the picker location.
• Improve the picking process by reducing the walking distance of the picker, which can only be possible if you have successfully optimised the put-away process in the warehouse.
• Release the orders based on the picker location
• Also, check if you have the required inventory available to be picked by the picker

In short, you just have to minimise the product touch points.

Step 5 - Packing Process

In the packing process all the picked items will get consolidated in the sales order and get prepared for the shipment to the customer.

You have to ensure that there are minimal damages to the packed items from the time the items leaves the warehouse.

Three things to keep in mind while Packing

1. Packing must be light enough so as to not increase the overall weight of the entire goods
2. Minimal enough to control the packaging cost
3. Good enough to ensure the safety of the item packed.

Otherwise the customer will return the items that got damaged because of poor packing.

You can use softwares that can guide the people in executing the packing tasks. Product dimensioners or scanners can easily automatically determine the right type and amount of packing material for the packaging.

With the help of Technology, you can actually keep your packed items safe and the packaging costs low.

Step 6 - Shipping Process

The End process of the warehouse in logistics, where you dispatch the items/goods from your warehouse to your customer

This process is also the start of the journey of your packed items from your warehouse to the customer.

Successful Shipping process includes the following

• Right sorting of the items
• Right loading of the items
• Dispatching to the right customer
• Travels through the right transit mode
• Gets delivered safely and on time

Also, this below given list of documentation will help you optimise your shipping process.

• Cargo document
• Export Licence
• Shipment Licence
• Bill of Lading
• Inspection Certificate
• Insurance Certificate
• Invoice
• Certificate of Origin
• Advanced Shipping Origin
• Picking the correct Transit Mode for your Shipment

The above list may vary from warehouse to warehouse. Not always you need all the documents mentioned above.

So, I really hope with this post I have properly explained all the Starting to End process for Warehouse in Logistics. If there is anything you think that I have missed, it's my request that you please it down in the comments below. I will be really happy to reply.

Thank you for taking your time to read my post. Please share if you think my post is worth enough. Take Care.

PM Gati Shakti provides boost to North-East Region in Logistics Infrastructure

On Tuesday, 6th of December 2022, the First edition of North East Logistics Conclave was concluded. It was held in Guwahati, Assam, which was organised by CII with DPIIT. Total of 200 Delegates from North Eastern States of India attended this event.

PM Gatishakti focuses on world-class seamless multimodal connectivity to strengthen the entire supply chain in the country. And for the last 10 years, India has been on a path of creating a diverse export portfolio. Government has been providing incentives to exporters from the north eastern states of India, creating manufacturing infrastructure for north eastern states that can meet the global demand and finding more buyers not just in the west but everywhere around the globe. Once the region will have a proper manufacturing infrastructure then the Government will be able to benefit from accurate information on resources, labour, and infrastructure developments going on.

In order to strengthen the logistics infrastructure, 55 Ministries will spend 10% of their budgets in the North Eastern Region, according to Dr. Rajkumar Ranjan Singh, Minister of State for External Affairs.

MEA is working closely with the neighbouring country Bangladesh to improve the logistics connectivity via rail, road, air and water.

1. In Assam, the government has already allotted 15% of the land for logistics development

2. In Tripura, the government has successfully implemented the logistics policy in the entire state and further investments of Rs 35 crore have been dedicated for Industrial estate infrastructure.

3. VAHAN app is being used in the North-East region to track the movement of the vehicles across the border.

4. Last 8 Years achievements in the North-East Region are here in this pdf file.

In order to fulfil the goal of creating the North-East region a manufacturing hub in India, improvement in Logistics Infrastructure is a must. Then only the entire supply chain will be able to benefit.

For all those who lost their jobs during the pandemic, this move will help create jobs not just in the Logistics Sector but also in the Manufacturing Sector. The government must make sure that the education skillset being imparted in the region will match the skill sets needed for the jobs. Because, the rate at which technology advancements are happening in the country is far higher than the skills available with the present workforce.

A lot of job cuts are not due to fall in demand for the jobs, but due to unmatched skill sets or employees being under qualified. The government should also think of creating learning programs along with the on-field jobs, that can not only prepare the workforce with current skills needed for the job but also make them future ready for the operations.

References

https://www.logisticsinsider.in/pm-identifies-55-central-ministries-to-spend-10-of-their-budget-on-improving-logistics-infrastructure-in-north-east/

https://economictimes.indiatimes.com/news/india/55-ministries-to-spend-10-of-their-budget-for-improving-logistics-infrastructure-in-north-east/articleshow/96038305.cms https://mdoner.gov.in/ https://www.sentinelassam.com/topheadlines/pm-identified-55-ministries-to-spend-10-of-their-budget-for-ne-dr-rajkumar-ranjan-singh-626832

https://www.indiatodayne.in/assam/story/central-ministries-spend-10-cent-their-budget-improving-logistics-infrastructure-northeast-479748-2022-12-06 Eight Years Achivements in the North East Region from 2014 to 2022 - https://static.pib.gov.in/WriteReadData/specificdocs/documents/2022/apr/doc202241341501.pdf https://ciinelogisticsconclave.com/ https://www.cii.in/ https://dpiit.gov.in/ PM GATISHAKTI - https://www.india.gov.in/spotlight/pm-gati-shakti-national-master-plan-multi-modal-connectivity

Top 10 Global Supply Chain Issues 2022

Top 10 Global Supply Chain Issues 2022

With this post, I will cover the Top 10 Global Supply Chain Issues in 2022 that has caused a ripple effect in the entire Supply Chain in the post pandemic world.

In the post pandemic world, even when the world is back to its business as usual we can still see the issues in the global supply chain. People are vaccinated in the majority of the countries and in some developed economies, a good proportion of the population has even received their booster shots.

1) Russia-Ukraine Conflict

Since the Russia-Ukraine Conflict, there has been a severe impact on the prices of most commodities that were being exported around the world like, fuel, oil and distillation products, Energy products, Iron and steel, Fertilisers, pearls and precious metals, etc,. On top of that, Europe has been importing natural gas and crude oil for decades, which means restriction to any of them could easily threaten the entire Europe. Russia also exports fertiliser globally, that means if the supplies get affected anywhere in the world, the crop yield will also get impacted.

2) Inflation

Inflation causes ripple effects along the entire supply chain. From the procurement of raw materials to the production of commodities, its transportation to the distributors, warehouses, retailers, or the final customer gets affected. Because of Inflation your cost of production increases, you start paying higher wages, your energy prices increase because of which the cost of transportation also increases.

And on the other end, people’s disposable income is still the same, which is reducing the demand for commodities. Because of shrinking demand for goods, businesses are also cutting on the supply of raw materials, because they know that they cannot charge the consumers for an increase in prices of raw materials.

3) Over Reliance on Major Suppliers

The Covid 19 pandemic brought to light the habit of businesses of maintaining strong relationships with single suppliers or just one major supplier. Because of which none of the businesses never had any backup supplier in case of an emergency.

4) Workforce and Labour

More than millions of workers across the globe have already lost their job post pandemic. Also, as the global supply chains are recovering, businesses are making more technological improvements and adapting to more innovations that can easily cater to the rising and complex consumer demands.

Workers across the globe are not fast enough to adapt to the technological skill sets demanded by these supply chain jobs.

5) Energy Shortages

Because of the Russia-Ukraine conflict, there has been a shortage in energy supplies by Russia in Europe. Europe’s economy is heavily dependent on exports. Because of restrictions in energy supplies, companies have either started cutting back their operations or going into temporary shutdowns. Food Supply Chains are getting impacted globally, especially in countries that were importing Fertilisers from Europe. And Europe has already slashed the majority of their Fertiliser Manufacturing Supply Chains.

6) Increase in Fuel Prices

As the cost of fuel prices increase, the cost of product movement across the supply chain keeps on increasing. Once the operational costs and production costs increase, it automatically affects both the business as well as consumers. In short, the cost of transportation of goods increases as the product moves from point A to point B, along the entire supply chain.

A lot of us now must have noticed this especially while ordering food online. The delivery charges have increased globally.

7) Extreme Weather Events

Drought has been noticed around the world, in Europe and China. As the water level drops, ships are in danger of running aground. In some cases, the freight can be transported via other modes of transport, but there is no replacement for sea freight, as you would need hundreds of cargo container trucks to replace a single container ship.

There are rivers in Europe that have started seeing a drop in water level. Yangtze river in China, is reported to have its water level below 45%.

8) Further Lockdowns in China

China is still battling with its Covid 19 infections, despite its Zero Covid Policy. Operations in the Shanghai port have slowed down. Foreign companies like Tesla and Apple are still wary of returning to their 100% working capacity. There are still some locations in China under strict lockdowns. And most foreign companies have started looking for production facilities alternatives to China.

9) Semiconductor Shortages

Today’s modern car requires a minimum of 1400 - 1500 chips and due to lack of these chips, there was a fall in the sales of cars globally. Companies like Sony, were unable to fulfil their latest generation console PS5 demand globally. The GPU makers like NVidia and AMD, were not able to manufacture graphic cards, because of which their merchants were seen selling their earlier stocks of GPUs with a markup of up to 300%.

10) Technology

As the global supply chain is getting more and more demanding, businesses have started to adapt to more technological innovations that can remove the bottlenecks and streamline the operations, so that the global supply chain issues can be tackled more efficiently and effectively. However, there is a lack of workforce that is equipped with the necessary skill sets. Businesses must start taking into account the Generation Z, as they will be the next workforce in the industry taking charge.

So, there were the Top 10 Global Supply Chain Issues 2022 that were seen globally.