Logistics Interview for the Insigth of Haeger & Schmidt Logistics GmbH

20.05.2022 | Article of Salzgitter Flachstahl GmbH

"Generous space and comfort for sensitive coils"

Salzgitter Flachstahl has handled many transport operations via the terminal of Haeger & Schmidt Logistics (HSL) in Duisburg for many years. Since the extension of the steel logistics hub, the company can cover a major part of its supply chain using HSL.  Fabian Gerdes (on the right in the picture), Head of Customer Logistics at Salzgitter Flachstahl, explains what has changed since then in an interview.

What role does the Duisburg Stahlinsel play in Salzgitter Flachstahl’s logistics?
The Stahlinsel enjoys a long tradition as an important transshipment point for many of our products, including steel profiles, quarto plate and coils. The Stahlinsel plays an important role as a hub in short sea shipping, especially for the automotive industry. We use the hub to transport our steel with HSL’s liners to England – with limited storage capacities up until now, however.  
The new terminal significantly expands the scope for use. Since the completion of the temperature-controlled hall, we can also process sensitive steel coils there without protective export packaging. The newly created capacities have also made the Stahlinsel a place we can use as a warehouse location in the form of a hub. These new framework conditions allow the volume to be increased to 25,000 tonnes a year which we can now additionally export via Duisburg.

Have new logistics services also been created?
Along with conventional services, such as trimodal transshipment between barge, rail and truck, new activities have also been added since the hall was opened. These activities also include container stuffing and precarriage on the way to various sea terminals for global export, the interim storage of weather-sensitive steel products, and delivery to our customers on time using the various transport modes of rail, barge and truck.

How has the steel logistics hub influenced your logistics processes?
We produce 24/7 virtually 365 days a year in our steelworks in Salzgitter. These activities result in an extremely high production volume, with our own storage capacity only designed to take an output of a few days. The new hall has given us the possibility of interim storage which is aligned to onward transportation and therefore minimises the additional handling of our products. A particularly attractive feature for us is the capability of accessing this location with our own SLOT train system, independently of the single wagonload system. The abbreviation “SLOT” stands for Salzgitter Logistics Transport. The system consists of one to three trains a day which travel to the Ruhr district and in the direction of Karlsruhe and can be seen as a sort of milk run, with flexible variation in the branches used on a daily basis. The train to the Ruhr district branches out to enable direct customer deliveries, storage options and raw materials transportation. Each new branch which we can dock on to the system enhances the flexibility and the continuous transport away from our steelworks.

Can you give us a few examples of why hub and storage possibilities have become more important?
The new possibility of interim storage means that we do not have to wait until our customers request the steel coils or until closing at the port is imminent. As soon as the material is ready for shipment, we transport it to the steel logistics hall in Duisburg – with full flexibility provided by our system. This has put us a decisive step ahead of demand. We are currently having to deal with the problem that, due to the tight situation on the transport market, we do not have reliable delivery times any more when we receive customer orders. By putting our goods into storage, we are ahead of the game and have more time.
Another advantage consists of being able to access the Stahlinsel with our own SLOT system. Using our own equipment gives us independence from third party service providers in this link in the supply chain, while allowing us to avoid further interfaces and transshipment points, all of which makes us a great deal more resilient.

In logistics, what is especially valuable for you in terms of your steel products?  
We place great emphasis on long-standing partnerships based on trust, both in relation to our customers and our service providers. This gives us a stable basis for us to work together on optimising logistics processes. Quality aspects especially important to us include adherence to delivery dates and reliability. Furthermore, we focus on a high degree of automation and digitalisation, along with sustainability and, last but not least, profitability.

How significant is the topic of sustainability in the field of steel logistics?
Under the SALCOS® – Salzgitter Low CO2 Steelmaking programme, we are working on reducing our carbon footprint by more than 95 percent in the medium to long term. Our aspiration is to achieve virtually climate-neutral steel production, which also encompasses sustainable and climate-neutral logistics.  In this segment in particular, we strive to be a pioneer and rely, whenever at all possible, on the transport modes of rail and inland waterways. Today the proportion of rail in shipment logistics from our steelworks in Salzgitter is already at 80 percent. Our medium-term goal is to raise the share to 85 percent. More than this is not possible from the standpoint of today as rail does not go to all destinations, or the volumes are too low which would make rail transport a financially unviable option. But rail is essentially our first choice since we save around 100 truckloads by deploying one single train.  Along with the environmental aspect, the bottleneck due to the increasing scarcity of drivers needs to be factored into the modal split we envisage. We therefore only use trucks if there is no other alternative.

Where do you see potential for optimising steel logistics?
At present, the task consists of keeping the existing processes running, while minimising inefficiencies as far as possible. The environmental conditions are difficult due to the war in Ukraine and the coronavirus pandemic. Disrupted supply chains, the tight situation concerning transporting goods by rail, the high number of building sites, and a substantial shortage of transportation means hamper daily business. We have to move away from the idea of drawing on plentiful resources in this segment. Logistics resources are becoming a scarce commodity. Consequently, closer coordination between the parties engaging in the transport chain is required, transportation flows need to be combined and resources put to better use. To put it in a nutshell: Logistics needs to become more transparent and efficient. Warehousing will take a more prominent position and substitute for, or at least supplement, just-in-time and just-in-sequence concepts.

You can find the complete interview in the special edition Insight of Haeger & Schmidt Logistics GmbH.