Production design for plate products in the steel industry

We describe an optimization tool for a multistage production process for rectangular steel plates. The problem we solve yields a production design (or plan) for rectangular plate products in a steel plant, i.e., a detailed list of operational steps and intermediate products on the way to producing steel plates. We decompose this problem into subproblems that correspond to the production stages, where one subproblem requires the design of casts by sequencing slabs which, in turn, have to be designed from mother plates. The design of mother plates consists of a two-dimensional packing problem. We develop a solution approach which combines mathematical programming models with search techniques from artificial intelligence. The use of these tools provides two types of benefits: improvements in the productivity of the plant and an approach to making the key business performance indicators, such as available-to-promise at a production level, operational.