How AI Is Powering the Next Phase of The Metals Industry
The metals industry is essential to the development and advancement of the economy. It supports thousands of employments and supplies necessary raw materials to important manufacturing and construction industries, playing a crucial part in the industrial value chain. Although the COVID-19 pandemic increased demand and production irregularities, the sector quickly rebounded in 2021, and this trend is more likely to continue.
The World Steel Association predicts that in 2022, the steel demand will rise by 1,855.4 Mt – 1,896.4 Mt, at an increase of 2.2% yearly.
The metals industry must concurrently lower its carbon footprint & adopt decarbonization strategies to tackle the climate change threat because it is one of the primary sources of GHG emissions. According to the World Steel Association, 1.85 tons of carbon dioxide was released for every steel ton produced in 2018, accounting for almost 8% of all carbon dioxide emissions worldwide.
The metals industry has no choice but to look at technological and economically beneficial ways to reduce carbon footprint and embrace more sustainable solutions, considering government rules addressing climate change and rising public interest in sustainability.
What does this mean for the industry? The year 2022 will be the year the sector promotes the adoption of digitalization technologies to address the opportunities and difficulties since its projected demand to increase, and there will be equal pressure to minimize its carbon footprint.
Where AI can be most valuable for the metals industry
The metal sector is transforming its business operations to the forefront of Industry 4.0. This industry is supported by technologies like the Internet of Things (IoT), cloud computing & AI/ML, enabling the manufacturers to make data-driven decisions immediately to use predictive maintenance, manage processes, optimize assets, reduce downtime, and improve product quality. Even though the industry has been gathering data for some time, it has not yet realized its potential for gaining insights that might lead to higher efficiency.
Artificial Intelligence (AI) and Machine Learning (ML) are key enablers to speed up the benefits of Industry 4.0.
They are crucial when working together to extract value from the massive amounts of information in real time and boost operational performance. The three most important areas where AI is now assisting the metals industry are asset and energy optimization. The immediate benefit of AI is helping operations engineers make data-driven decisions based on performing their actual processes and assets. Operators using AI can control the operation to actual performance based on prior arrangements. AI-powered digitalization assists metal firms in integrating sustainability into manufacturing processes as more and more of them commit to net-zero goals.
And it is happening today. Leading metals companies worldwide use Canvass AI to increase quality, decrease costs, eliminate waste, and lower carbon emissions. To estimate future production throughput, regulate production quality, reduce energy consumption, and reduce waste across all phases of steel production, including processing raw material, steelmaking, casting, and hot rolling, users use AI every day to unlock intelligence from the data.
You might wonder why these metal firms have succeeded when Gartner predicts that 85% of AI efforts fail. It can reduce this to three common elements:
- Use an Industrial AI platform: Not all Ai applications are suitable for every setting. And this is true in manufacturing environments. Industrial data has a higher noise level and is exponentially more complex because of its volume, velocity, and fluctuation. AI systems created for retail or banking environments cannot handle the requirements of an industrial context. Metals companies who have successfully used AI to extract value have instead relied on Industrial AI platforms created from the ground up with industrial problems in mind.
- Empowering the Team: Many companies prefer assembling a data scientist team to increase their AI capacity. It can take years for this to materialize, putting the operational SMEs – i.e., the industrial engineers & operators – out of the picture. Successful companies that have been able to extract value from their data have provided their operational teams with AI so they can add their knowledge to interpret the data.
- Focusing on high ROI: Successful metal companies that have been able to extract value from AI have concentrated their attention on the processes that consume the most power and energy that have the higher operating and raw material costs. By doing this, they have increased line speed, improved quality, decreased scrap, and reduced emissions, which have justified their investments.
The metal industry is currently at a critical juncture. The sector must equally manufacture high-quality goods while keeping costs down, decarbonize quickly and progress toward its net-zero targets. Focusing on digital transformation powered by AI will be highly beneficial for the metal industry.
According to the World Economic Forum, digitization will allow the metals industry to generate $400 billion in revenue over the next decade. Further, using AI to reach its net-zero goal is an intelligent business move. According to McKinsey, 14% of the world’s steel companies’ potential values are in danger if they do not reduce their environmental impact. The time has come for the metals industry to use AI to change the industry’s future as these pressures increase.