How do you assess the current situation in the metal and steel industry in general?
2018 was characterized by strong investment activity in the steel industry, especially in our most important markets China, Europe, and the USA. The main driver is lightweight construction in the automotive industry, including the high-strength steels required for this. ANDRITZ offers innovative solutions for pickling, cold rolling, heat treatment, and coating.
Globally, according to available market data, there is a new historical value for overcapacities in the steel industry. In 2018, worldwide capacity utilization was approximately 76%, i.e. we are talking about approximately 550 million tonnes of unused production capacity. The strongest growth in steel production can still be observed in China. World steel consumption rose by just under 4% in 2018, driven mainly by Asia; we expect a slowdown of between 1 and 2% in 2019. Globally, approximately 30% of the production volume of steel is exported. Protectionist trade restrictions have reduced the trade volume (by approximately 7-8% in 2018). Flat steel prices rose between the beginning of 2016 and the end of the third quarter of last year, which led to very good results for most of our customers in 2018.
What does Industry 4.0 mean to you?
ANDRITZ is involved in digital transformation in three main areas. We have combined these digital activities under the ANDRITZ technology brand Metris:
IIoT products: Here, the main focus lies on the optimization of plant operation, which means the use of sensors, highly developed and highly complex data analysis, and augmented reality
Smart services, for example, efficient online ordering of spare parts for our customers, and
Ventures, which accelerate digital innovation by promoting internal idea management and cooperation with startups and research institutes.
In terms of operations, plant optimization probably offers the greatest leverage for our customers. If production is increased by only a few percent with a software solution, this results in a measurable benefit for our customers. With Metris OPP (Optimization of Process Performance), we offer a solution to achieve just that. The OPP platform uses big data and provides digitally supported tools that ensure increased efficiency and profitability of our customers' assets without the need for capital investment.
We see Metris OPP as an important service product for our customers, with a step-by-step approach:
Joint definition of objectives (e.g. increase in production capacity, reduction of downtime, etc.)
Identification of the optimization potential based on analysis of the data from the existing plants, sensor technology, and additional smart sensors
Implementation of improvement potentials to achieve the set benchmarks
Always keeping the main objective in mind: The OPP platform supports managers, technicians, operators, and the maintenance team with appropriate digital tools.
Continuous optimization of the platform in line with the latest state of the art
ANDRITZ developed Metris OPP itself many years ago and then evolved it further on a continual basis. Since 2007, OPP has been used successfully in over 40 plants (mainly in the pulp and paper industry) in Brazil, Europe, and the USA. There are already four installations in the steel industry, which we are using to create a significant competitive advantage for our customers.
How important is globalization of the industry?
We are observing a worldwide consolidation in the steel and aluminum industries. Compared to other branches of industry (for example, raw materials), market concentration in the metal industry is still low. For us, this means that existing customer groups will be restructured in the future, and decision-makers will change from time to time. This trend towards larger groups of companies and mergers can be observed both regionally and globally. Trade restrictions have some negative consequences for us as a result of customs duties or customers who can no longer be reached. However, they also offer short-term opportunities, as is currently the case in the US steel industry.
What role does The Bright World of Metals play as matchmaker, contact platform and exhibition trade fair?
METEC is the most important trade fair for our industry. ANDRITZ offers innovative flat product processing technologies, and we look forward to exciting discussions with our customers.
ANDRITZ is a globally leading supplier of plants, equipment, and services for hydropower stations, the pulp and paper industry, the metalworking and steel industries, and for solid/liquid separation in the municipal and industrial sectors as well as for animal feed and biomass pelleting.