Issue September / October 2007
SSAB – steeling ahead of the competition
As a member of the renowned SSAB Swedish Steel Group, SSAB Oxelösund is the largest Nordic manufacturer of heavy steel plate and a world leader in the specialist field of quenched and tempered steels, producing prominent brand names such as Hardox, Weldox and Toolox for the international market.
Located on the east coast of Sweden 120km south of Stockholm, the company is the biggest employer in the region with 40 different occupational groups represented in the company, which offers its employees excellent opportunities for career changes and progression.
SSAB Oxelösund is the only iron ore-based steelworks in Sweden to have an entire production line stretching from raw materials to rolled plate and produces around 632,000 tonnes of heavy plate annually. Around 90 per cent of its production is exported throughout Europe and the company has extensive stocks in more than 40 countries worldwide, as well as a turnover of ten billion Swedish Kronor.
Efficient, state-of-the-art processes enable the company to manufacture plate with a variety of properties and the company produces heavy plate extending in thickness from 3.2mm upwards.
Acting executive vice president Ola Hägglund outlines the company’s credentials: “The most significant fact about us is that we boast the broadest programme in abrasive steel anywhere in the world. Our main site based in Oxelösund produce plates and abrasive plates for the mining industry and for recycling, as well as high strength disks for yellow goods. We primarily serve the crane industry and have the strongest construction steel in the world. We’re a subsidiary of SSAB in Sweden and employ a diverse range of people with around 20 per cent of the workforce comprised of women. Sweden is a small domestic market for us as we export 90 per cent of our products primarily to Europe – Germany in particular – with a large presence in Italy. We also have a smaller stake in the North American and Asian markets.”
SSAB Oxelösund’s parent company SSAB was formed in 1978 through the merger of three steelworks – Domnarvets Järnverk in Borlänge, Oxelösunds Järnverk, and Norrbottens Järnverk in Luleå. Since then, the group has successfully cultivated a niche market for high-strength steel and has grown both organically and through strategic acquisitions, for example with the attainment of US steel company IPSCO Incorporated in July 2007. This new development arose from SSAB Oxelösund’s desire to become the global leader in value added steel by 2010 and provides a platform for future growth and expansion, as well as the opportunity to extend its market presence in the US. IPSCO will be organised as another division in the SSAB Group.
Also in 2007, SSAB Oxelösund invested eight million euros in the inauguration of a new plate centre for warehouse and wear parts processing in China, which is the first for SSAB in the Asia- Pacific region. Occupying an area of 50,000 square metres, the Kunshan Plate Centre is able to store in excess of 20,000 tonnes of steel plate, which is close to the capacity at the central stockyard in SSAB Oxelösund.
The company has a long history with roots dating back to the first half of the previous century. The first ironworks in Oxelösund was built between 1914 and 1917 and it was the first in Sweden to base its iron production on coke, which was produced from coal in the company’s own coking mill. Between 1957 and 1961 the mill was expanded into an integrated ironworks, steelworks and rolling mill with heavy plate as the main product. Expansion then continued in several stages to become the world’s most powerful plate rolling mill by 1998.
SSAB Swedish Steel Group was founded in 1978 and to ensure that previous competitors Domnarvet, Luleå and Oxelösund co-operated, divisions were organised that gave the companies different responsibilities. Oxelösund was given the task of producing heavy plate, Domnarvet was to specialise in strip, sheet, wire and rails, and Luleå was to produce beam products and universal steels. The Group was reorganised in 1988, which led to the founding of the current parent company and Oxelösund became a subsidiary, trading under the name of SSAB Oxelösund AB.
The company supplies steels that are well suited to a variety of applications and provides technical advice free of charge to clients if they are uncertain of which steel is most appropriate to their needs. The engineers also offer advice on the best design approach for specific steels. Ola thinks that SSAB Oxelösund’s extensive experience and focus on its customers helps it to stay ahead of competitors: “Generally speaking, we provide customers with added value. We’re working a great deal with drilling, welding and cutting, and we’re developing new programmes for abrasion, wear and different solutions in tension solving in the construction industry. Everything we do is connected to how we can add value. We target customers that are connected to yellow goods, recycling and mining segments, and also focus on the after market or end-users because we want to have the margins in the whole business. We focus firmly on excellent service and we have the knowledge to instruct clients on how to weld, cut, and drill i to the plate – basically how to use it in their applications.”
All steel is continuously cast into slabs in two modern continuous casting machines and the annual slab production capacity is around 1.6 million tonnes. Some of the slabs are used for in-house production of heavy plate, while others are shipped to SSAB Tunnplåt in Borlänge. SSAB Oxelösund’s rolling mill produces heavy plate from slabs of various sizes and grades and the four-high rolling mill is one of the world’s most powerful, applying a force of 10,000 tonnes when rolling. The mill is the first European heavy plate rolling mill to be equipped with the Continuous Variable Crown (CVC) control system that allows for effective control of the thickness profile and flatness of th plate. After rolling, the plates may be up to 60 metres long and pass through flying shears in which the plate is cut to the required lengths. To achieve high strength and wear resistance, combined with improved welding and workability properties, the plates are heat treated and hardened after rolling.
SSAB Oxelösund has invested $1 billion over the past ten years, predominantly in factory machinery, in order to develop the business. “We have mainly invested in our core industry areas and more than doubled our capacity in that time,” explains Ola. “We have been investing a great deal in equipment and production capacity in relation to our business areas and our aim is to go even further, which is why we have set a target of doubling our capacity again between 2005 and 2010.” The company’s R&D activity is integral to its effectiveness and continued success, says Ola: “R&D is extremely important as we’re the market leader in the world in our field. We always have to be ahead of our competitors at the forefront of technology, which is why R&D must fundamentally have a large impact and influence in every aspect of our daily work.”
Steel plays a vital role in the global economy and products containing steel are found everywhere in daily life. Owing to their unique properties, SSAB Oxelösund’s products cause reduced environmental impact by enabling the end products to be lighter and to have a higher load-carrying capacity as well as a longer useful life. Steel products from SSAB Oxelösund are among the foremost in the world and engineers can design products using its steel that are lighter and more wear resistant without compromising on performance, which obviously leads to environmental benefits. For example, vehicles made of high quality steel cause less wear on the roads and consume less fuel since they are lighter. Steel is also an excellent closed-loop material as it can be recycled time after time without its properties being impaired.
Thanks to its comprehensive environmental policy, SSAB Oxelösund AB is one of the world’s cleanest steelworks, which makes it a forerunner in ecological issues within the steel industry. It has a certified environmental management system in accordance with ISO 14001 and continually develops its operations in order to protect the environment. With regards to other high standards, SSAB Oxelösund produces its heavy plate in accordance with international standards including SS-EN, DIN, BS and ASTM. It also has QA certification in compliance with ISO 9001:2000 and QA approvals from most of the classification societies.
Its flexibility and receptiveness to change has allowed the company to flourish over three decades and the company has progressed from targeting purely commercial steel markets to niche markets in order to maintain its leading position. “Our focus, dedication and long-term view on the business have allowed us to succeed for 30 years,” believes Ola. “We started focusing on niche markets because with the commercial steel market we were dealing with selling plates for the shipyards in Sweden but in the mid 1970s the ship industry disappeared. We recognised that we couldn’t earn any more money from it and saw the only way to survive was to evolve by finding a new business. We decided to focus on adding value because in the Western world a business depends on more than costs and certain price levels – you must perfect the product. It is more important to give the customer a higher performance, so you can legitimately increase the price level, because we can’t compete on the cost side with Asia, for example, by slashing prices. We have to compete on the added value side.”
Ola thinks that SSAB Oxelösund can also compete on an efficiency level and conscientiously improves its processes in order to retain its leading position and reputation: “Manufacturing efficiency is always an issue because we strive to be superior and constantly improve through increasing productivity. We run continuous programmes that promote enhanced performances and more impressive key figures. It’s important not to lay back and simply be satisfied with what we have already achieved because competitors are always trying to catch up.”
In 2003, SSAB Oxelösund progressed further when it started using i2 Supply Chain Management (SCM) solutions provided by i2 Technologies Inc., a leading provider of end-to-end supply chain management solutions. ROCE Partners, i2’s implementation partner in the Nordic region, completed the custom configuration and i2 SCM was implemented in just six months. The i2 SCM modules installed were i2 Demand Planner, Supply Chain Planner, Profit Optimiser and Demand Fulfillment with real-time order promising. As part of this project, the organisation redesigned its business processes to enable collaborative forecasting of sales, volumes and prices, master planning, profit optimisation, and capacity allocation planning. The i2 solution was configured by ROCE Partners to complement these improved processes. Since 2003, the system has been rolled out to more than 60 users in the company.
SSAB Oxelösund continues to develop, refine and renew its production system, as well as pursue the development of new products through the continuing focus on its R&D programme. With regards to future goals, SSAB Oxelösund will forge ahead in meeting its own high standards and flexibly react to market developments. “We have a strong action plan and our primary aim is simply to fulfill this strategy,” reveals Ola. “At the same time, the challenge we’re facing is to adjust our operation to changes in the market with regards to what our competitors are doing and our customers’ needs. We see Asia, Eastern Europe and now even South America as growing very rapidly, and I think where the infrastructure has to be developed there is a huge market for us. We have to look beyond the mstate of the market in five years time and consider at least ten years into the future, whilst endeavoring to improve upon the important developments we have made over the past 20 years.”
Continuing, Ola concludes: “Our vision is to make great progress in the steel industry in order to maintain our position as market leader in this field and improve continuously to retain this high level internationally.”
Products: Steel plate