Severstal goes digital with $100mn investment programme for 2020

Severstal goes digital with $100mn investment programme for 2020
The Russian billionaire owner of steel giant Severstal, Alexei Mordashov (centre), has announced a RUB6.7bn ($100mn) IT and digital investment project for the metal company in 2020
By EWDN in Moscow March 15, 2020

Russian steel giant Severstal has announced it will invest RUB6.7bn ($100mn) in IT and digital projects this year, up 7% from 2019, reports East-West Digital News (EWDN).

The group’s projects for 2020 span “new solutions for managing material flows and optimising the quality of finished products” to building “new technological networks to improve the quality of data transmission [and address legal requirements].” The group will also continue developing its ERP business management systems as well as its online store.

In terms of digitalisation, Severstal will “continue to develop and implement intelligent solutions [to] detect and predict future product defects, issue recommendations on the production process, and increase production volumes.” Artificial intelligence will be used to automate the related control processes. As an example, Severstal cites the use of a neural network to “recognise certain defects on metal sheets.” The system was introduced last year in one of the cross-cutting units of a metal finishing shop in the Cherepovets metallurgical plant.

Among other digital solutions, the group is using a mathematical model to automate the middle section of a continuous pickling unit.

According to Severstal CFO Alexey Kulichenko, the group has “doubled [its] investment in IT and digitalisation over the past three years,” which has provided “a significant positive economic impact.”

Investments in Severstal’s innovation activities have an international dimension. Just weeks ago, the group took part in an equity funding round for Dutch company Airborne, a global leader in digital automation platforms for the production of composite parts and products to automate advanced composites manufacturing.

“Working together with Severstal’s technical development and quality department, Airborne will examine the potential of integrated solutions based on composites and steel, and Severstal will offer its clients the opportunity to test these integrated solutions,” the company explained.

Last year Severstal announced the launch of an open innovation portal available in both Russian and English. The site features Severstal’s existing initiatives for co-operating with startups, innovative teams and industry experts from across the world. These include the Severstal tech park, a variety of technological and R&D challenges and the Steel Tech startup accelerator.

No less than 200 Russian startups applied for this acceleration process last year. As a result, the group says it is co-operating with nine of them. An Open Day will be held on March 11 in Skolkovo, the international tech hub being completed on the outskirts of Moscow. Severstal also launched two internationally-oriented investment vehicles: Severstal Digital Businesses and Severstal Ventures. Among the latter’s portfolio of companies is a US company called Modumetal, which claims it is “reinventing metals to dramatically outperform traditional steels and industrial alloys.”