Optimization of reduction processes at Ouro Branco plant

Gerdau Ouro Branco, located in Minas Gerais, is one of the largest steelmakers in Brazil and the largest unit of the Gerdau Group globally, with an annual production capacity of 3 million tons of steel. For over 6 years, the plant has implemented our mathematical optimization model, which has radically transformed the way strategic decisions are made at the facility.

Gerday faced significant challenges in optimizing the use of raw materials, particularly coals and iron ore. The plant needed to efficiently manage the mix and quality of these materials, which directly impacted production costs and the overall quality of the steel produced. They required a solution that would allow them to make better-informed decisions regarding raw material sourcing, mix, and quality. The goal was to reduce costs while maintaining the necessary chemical and physical specifications for steel production, without compromising on quality or availability of materials.

Our mathematical optimization model focused on optimizing the material mix for the reduction processes, specifically contemplating the impact of raw material quality on fuel consumption and facilities productivity. This approach provided Gerdau with actionable insights to make more strategic decisions on raw material selection, directly influencing the cost-efficiency and performance of their operations.

The optimization model became a key corporate decision-making tool. It now drives all changes to mix and specifications, optimizing these decisions efficiently. The tool replaced complex spreadsheets, enabling quicker, more precise analyses. As a result, the plant achieved a significant reduction in steel production costs.