Bi-Stage Optimization Model For Transportation of Construction Steel: An Indian Case Study

Abstract

In a steel plant, one of the critical tasks of plant logistics is the transportation of the finished products. A steel company transportation system generally consists of a fleet of load-carrying trailers and rail, which are used to transport finished goods. In this paper, a two-stage mathematical model is developed for an Indian company that helps with strategic planning of the supply of finished construction steel (TMT Bar and Structural Steel) from multiple plant locations to the stockyards and then to the distributors. The transportation cost depends on various factors like the type of transportation mode, loading & unloading charges, and other fixed expenses. The steel demand also varies based on the season and other external factors like COVID-19, government policies, and so forth. The model proposed in the present research facilitates cost-effective network planning by achieving the most appropriate dispatching method considering various factors operating in multiple stages using a mixed fleet of trailers and rail. The model’s key objective is to optimize the transportation cost and demand for construction steel.