The Steel Supply Chain Part 2

Part Two: The Role of Service Centers in the Steel Supply Chain

Steel mills excel at manufacturing steel- it is, after all, their business.

Once steel has been formed into hot-rolled slab it can be further processed into various types of steel products like hot rolled, cold rolled and galvanized product. It will be thinned out across a gamut of thicknesses (referred to as gauges) using different types of processes. To keep it simple, just realize that hot-rolled slab is processed in lots of different ways and that each process adds to the final material’s properties and appearance.

Mills are exceptional at manufacturing these various types of steel and they do great at delivering it to customers across the street and across the world.

There’s just one problem, mill coiled steel looks like this:

Service center Coil Receiving

In case the person standing next to these coils didn’t demonstrate fully for you, these coils are massive. Try 10,000-20,000 pounds massive on for size. Just two of these coils max out the load on a full-size semi-truck. That’s well enough, assuming your facility has massive overhead cranes and equipment sturdy enough to handle 20,000 pounds of pressure.

Oh…your fabrication services require 8’ by 10’ sheets of metal? Yeah, huge coils might not be what you’re looking for.

Lucky for you, companies like OFR Metals exist. We buy from steel mills and then process their mammoth coils according to each customer’s specification-slitting and re-coiling material into smaller coils, leveling coiled material and then cutting it to specified lengths and widths, etc.

Our real purpose is linking our customers to the steel mills. That is how we fit in the steel supply chain.steel supply chain link

We take that role seriously. We believe it means more than just providing customers with material. Linking customers to the steel mills means providing them with the expertise that they would expect to get if they bought directly from the mill. We are unique that way. We host open houses where customers are invited to meet with metallurgists (someone who is an expert in making and using metal) from the mills. We gather market intelligence from mill representatives to help our customers make smart buying decisions.

Additionally, lean metal distributors, like OFR Metals, know how to shorten lead times, maximize inventory efficiency and minimize material delays. We try to tighten the steel supply chain so our customers experience less down-time and have the information they need to make decisions in real time.

In the next segment, we’ll talk about our customers (it’s one of our favorite topics!). How do they use this processed metal? What happens on their manufacturing floors that take blank steel sheets and form them into recognizable, everyday items?

It might just surprise you to find out. Check back for part three of the Steel Supply Chain series.

Cold Rolled: How it is Made

Cold Rolled SheetWe recently discussed how hot rolled steel is made. Now it only makes sense we talk about cold rolled. Cold rolled is the next step along the line of flat-rolled steel products. The process starts with hot rolled P&O.

Hot rolled is processed to a final thickness that is heavier than most sheet products. A cold-reducing process is used, which results in a thinner thickness. The cold reduction starts with tension to the sheet. This causes the product to become thinner, obviously, but also harder and more difficult to form.

Because formability is important in fabricating sheet metal, the steel is annealed. The process of annealing consists of a heat treatment that changes the properties of the material to increase ductility. Doing this makes it a great product for the customer.

Let’s go a little more in depth shall we?

The Cold Reduction Process

So, you are looking for cold rolled coils? Well, to achieve it hot rolled P&O is sent through a series of tandem rolling mill stands (4-high or 6-high vertically stacked rolls). As the material exits each stand it is a fraction thinner than the original hot rolled P&O When it leaves the last stand the material is recoiled. However, at this point the material is hard, not easily formable and basically unusable for many applications.

OK, how do we make it usable?

The Annealing Process

To soften the steel it goes through the annealing process. The annealing process can be accomplished in two ways, batching and continuous annealing. Batch annealing involves stacking the hard coils four or five high on fixed bases or stools (hence the name “batch”). The material is covered to allow the coil to be concealed from the oxides in the atmosphere. These oxides can potentially damage the surface finish.

A large furnace is then lowered onto the stacks of coil. The space between the cover and the furnace is heated by gas while the inside of the cover is fan circulated to convey heat to the coils.

The next method of annealing is continuous. This method allows for the material to be sent through a furnace in a continuous rolled strip. It is then cooled and recoiled.

The heating of the material causes it to become softer and allows for better formability to be used in various applications. It is now usable.

Cold Rolled Finishing

cold rolled lighting fixturesNow what? The material needs to be finished to ensure it is desirable for the customer. After the annealing processes the material is kept covered to prevent oxidization while it is still at a high temperature. This also allows for the breakdown of oils and vapors that may be present after cold rolling.

The material then undergoes temper rolling. The process of temper rolling consists of cold rolling the material with a very low reduction. This finishing process helps with surface finish and flatness of the final cold rolled product.

The finished cold rolled coil is delivered to service centers, like OFR Metals, for processing and then sent to customers for fabrication of metal furniture (typically office use), motorcycle exhaust pipes, lighting fixtures and many more.

Cold rolled can also be sent through further processing to create galvanized, galvannealed, electro-galvanized and GalXC. All of which we will discuss later.

The Steel Supply Chain Part 1

Part 1: Our Suppliers

The steel supply chain is a complex network that spans the globe and delivers steel products across the world and back again. In this three-part series we’ll explain the steel supply chain in simplified terms and identify the work that goes on to increase efficiency throughout.

Part one of this series focuses on the process our suppliers use to manufacture raw steel slab. Part two of this series will deal with the supply chain moving from various processing and rolling techniques and the import/export dynamic of large steel coils. Part three of this series will delve into our company’s process and will explore the relationship between service centers and end manufacturers.

Iron Output, steel supply chainThe Beginning of the Steel Supply Chain

Steel production starts off with a bang as iron ore is extracted from the ground using massive explosions. The ore is gathered using large magnets and is heated and formed into small round pellets. By itself, iron ore isn’t very useful- it lacks the strength needed for structural and manufacturing applications. Combined with carbon and other elements, it becomes stronger. Processed, it becomes malleable enough to be useful in many different applications.

Iron ore mining companies include corporations like Vale, BHP Billiton and Rio Tinto. Iron ore is extracted out of the earth and is smelted (heated up and chemically treated) using coke (high-carbon fuel). This makes a substance known as pig iron which is a more raw form of iron that is shipped around the world to steel manufacturing plants in North America, South America, Europe, and Asia (and elsewhere).

OFR Metals Steel Suppliers

OFR Metals works with various steel mills, most domestically located in the U.S., to maximize product quality and deliver efficiency. These include companies like US Steel, CSI, North American Stainless, and many others. These mills melt pig iron using massive amounts of heat and add in other elements (for example nickel and manganese) to give the steel the desired characteristics (surface finish, hardness, malleability, etc.). The liquid metal is then typically continuously cast into long metal slabs. These slabs will eventually be rolled out, put through various baths and eventually coiled (like a roll of paper towels) to ship out to distributors.

What’s it to You

Steel is strong, but it’s also malleable. Our many customers use different types of steel in various applications from building roofs for buildings to making the heating and ventilation systems in your homes more efficient. Steel becomes strong as it experiences heat and pressure, and as all the combined elements work in tandem.

Steel is our product, and it’s a product we believe in. We are all about emulating the strength that comes from working well with the parts that make up our chains of steel. We value relationships, and we work to forge those every day.

For customers or interested parties who want more information about our suppliers contact us at: purchasing@ofrmetals.com.

Make the Switch to Paperless Billing

O’Neal Flat Rolled Metals (OFR Metals) is going green and making the switch to paperless billing. While customers can still receive their bills and invoices through the postal service, the credit department is making the push towards digital services.

“We are hoping to provide customers with easy access to invoices while reducing paperwork,” said Cyndi Wallin, Corporate Credit Manager for OFR Metals. “It will be beneficial to our customers as well as OFR Metals to reduce costs and create efficiencies.”

OFR Metals wants to help its customers save money and time with the paperless billing program. A lean objective of the program is to cut waste by reducing paper product usage. The push to paperless billing also works to protect the environment. Every customer that signs up for paperless billing is saving trees. Nearly one billion trees worth of paper is thrown away each year in the U.S. alone.

The credit department currently estimates 20% of customers have made the switch to paperless. Wallin said she would like to see that number go up to 50% by the end of 2014. Current customers can expect to receive inserts with their next invoice that will share information on how you can switch to paperless billing, eInvoicing and online bill pay. There are three ways to switch to paperless billing or to receive more information:

  •  Call the corporate headquarters at 1.800.336.3365 and ask for your credit representative.
  •  Email accounts receivable at ar@ofrmetals.com.
  •  Visit the credit page to contact your credit representative or to pay your bill online.

Enrollment in paperless billing will allow customers to receive their invoice faster, pay bills without paperwork and help reduce waste.

OFR Metals Coming Together to Work Together

OFR Metals teamWe’re manufacturers and the manufacturing industry is an old soul. Our heritage is what drives us. American manufactures help create jobs, build cities, and are innovative leaders in many aspects. Our industry is old-fashioned and the heritage is deep.

At OFR Metals, our focus has always been on our relationships with our customers. As a family-owned company we know there is nothing more important than that. Through the ever-changing economy we have held firm to our founder’s belief, “it’s not about steel, it’s about people.”

OFR Metals Slit Coil PackagingBecause our industry is an old soul, we are not known as the innovative leaders when it comes to communicating with our customers. However, at OFR Metals we are taking that next step in growing our relationships. We are excited to be engaging with our customers through social media.

Here on the OFR Metals blog we’re listening and continuing to build strong, lasting relationships. Share with us your success stories. Tell us what you want to hear.

Henry Ford once said, “Coming together is a beginning. Keeping together is progress. Working together is success.”

So, let’s come together so we can work together. Connect with OFR Metals on LinkedIn, Twitter and Facebook. After all, it’s not about steel.