When Raw Material Optimization Guides Production Route Selection

In a modern steel plant —especially those integrated or undergoing technological transition— choosing the production route is not merely an operational decision. It is where metallurgical engineering, market intelligence, and strategic planning intersect. 

We share our experience on how prescriptive raw material optimization models —which incorporate process metallurgy fundamentals, production costs, and plant operating conditions— support decisions regarding route utilization. 

 

Understanding the Complexity of the Decision 

Many plants operate multiple active routes: blast furnace followed by BOF (BF-BOF), electric arc furnace (EAF), and in some cases, DRI/HBI integrated with EAFs.This setup —common in times of modernization or asset restructuring— offers flexibility but also increases decision complexity.  Our global experience shows that managing this with spreadsheets —or even with the best professional intuition— is not viable. 

 

Each route has different process conditions and cost profiles. The blast furnace requires a fine balance of sinter feed, lump ore, and possibly pellets, along with metallurgical coke and properly balanced slag for fluidity and impurity removal. EAFs offer more flexibility in metallic charge —allowing different blends of scrap, pig iron, and HBI— impacting energy consumption, metal yield, and slag formation. 

 

Metallic charge decisions should not be based solely on unit prices or average costs. Inputs such as pig iron, scrap, HBI (Hot Briquetted Iron), CDRI (Cold Direct Reduced Iron), and HDRI (Hot Direct Reduced Iron) are not directly comparable —each has different thermal, chemical, and metallurgical properties that affect downstream processing costs. 

 

Some materials enter the process hot (e.g., liquid pig iron and HDRI), while others enter cold (e.g., scrap, HBI, CDRI, solid pig iron). Their chemical composition (phosphorus, sulfur, carbon, etc.) also impacts yield, losses, final quality, and energy consumption. 

 

Why Spreadsheets Aren’t Enough 

From an economic perspective, the ideal comparison between routes and inputs should be based on marginal production cost, the real additional cost of producing one more ton, under the current conditions. This cost is non-linear and varies with raw material availability, metallurgical efficiency, losses, and production scheduling. 

 

Given this complexity—the diversity of raw materials (composition and price), the metallurgical requirements of each product, and the different cost profiles of the routes—this analysis becomes unfeasible in conventional spreadsheets.Prescriptive models —built on mathematical equations— allow accurate comparison between routes and associated inputs, supporting decisions with meaningful technical and economic impact. They reflect the interactions among quality, productivity, and cost across each input and production route and enable truly optimal decisions —maximizing both technical performance and plant profitability. 

 

 

The Right Decision Is Always Contextual 

There is no fixed answer. Today’s best route may be tomorrow’s worst, depending on ore quality or planned maintenance. This is why the model must be run frequently, on a regular optimization cycle. 

 

Far Beyond Theory 

This is not academic theory. It’s proven technical practice, applied at plants around the world. Successfully implemented in both carbon and stainless-steel mills, Cassotis’ prescriptive model has delivered: 

• Cost reductions between 2% and 6% per ton of liquid steel 
• Better use of available materials, without stockpiling 
• Resilience to market shocks, enabling route replanning in hours 

 

Conclusion 

In modern steelmaking, production route selection is no longer a matter of tradition or gut feeling. It must be treated as a living technical and economic equation —connected to the plant’s real context and the market. 

Cassotis turns this complexity into actionable decisions, grounded in applied mathematics, process expertise, and financial impact. And in doing so, we deliver something rare in this industry: confidence to decide —even in uncertain times.