Tata Steel Employs AI Chips to Save $2 Billion

Tata Steel, a global leader in the steel industry, is leveraging the power of Artificial Intelligence (AI). The company is set to drive efficiency and cost savings that were once considered unattainable. It is on track to surpass its target of saving a staggering $2 billion through data-driven innovations.

Tata Steel has harnessed its wealth of information and combined it with cutting-edge AI technology to achieve remarkable results. Jayanta Banerjee, Chief Innovation Officer at Tata Steel, aptly describes this synergy, “Data, cloud, and AI have become as important as iron ore and coke in our steel-making process.”

Banerjee’s journey into the world of steel manufacturing was unconventional. An IT professional by background, he brought his expertise in data management to Tata Steel in 2018. This set the stage for a digital transformation that is reshaping the industry.

Tata Steel operates with a keen eye on data, utilizing an extensive network of sensors across its five plants in India. These electronic and chemical sensors have turned the steel-making process into a heavily sensorized business. In 2018, the company managed about 6 terabytes of data. That number has skyrocketed to an astounding 5.2 petabytes, a thousand-fold increase.

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This exponential growth in data prompted Tata Steel to invest significantly in cloud technology. Jayanta Banerjee explains, “Today, 95 percent of our data estate resides on multiple cloud platforms, including Amazon, Google, Microsoft, Tata Communications, and IBM. This diversity ensures both security and redundancy, two critical aspects of managing such colossal volumes of data.”

Tata Steel’s success story revolves around what Banerjee calls the “three macros”: data, cloud, and AI. An in-house team at the company has developed over 260 algorithms that power various aspects of their operations. One remarkable achievement was consolidating individual control rooms into the integrated remote operations center (iROC) in Jamshedpur. This centralized hub controls all company operations, eliminating the need to relocate employees.

AI is pivotal in decision-making processes, particularly in raw material procurement. Banerjee elaborates,

Questions such as which raw material to buy, when and where to ship it into the plant, and how to efficiently allocate raw materials to different plants are best answered by AI models.

Beyond procurement, AI also contributes to optimizing the chemical mix in blast furnaces. It is a crucial step in steel manufacturing. When raw materials like coal are transported across long distances, impurities such as moisture and foreign materials can seep in. The raw material’s quality dictates what components should be added to the furnace, such as manganese and zinc. Banerjee explains, “Impurities in the output product are significantly reduced when we have better chemistry upstream.” This mix is fine-tuned through AI, ensuring the highest quality steel production.

AI doesn’t stop there. It plays a vital role in identifying the origin of defects in the steel products. Every product undergoes thorough imaging to detect defects like cracks and bubbles before reaching the final stage. If a defect is identified, the product is withheld from delivery. The image is then compared with an extensive library of defect images, providing insights into the issue’s source. This knowledge is transferred to the “digital twin” of the plant, where an AI model learns from the defect to prevent its recurrence.

Tata Steel’s embrace of AI extends far beyond the production line. The company utilizes AI in forecasting and planning, human resources management, customer analytics, and financial analysis. Jayanta Banerjee emphasizes that technology is adopted only when it positively impacts yield, energy, throughput, quality, or productivity. Over time, the cost-benefit ratio has improved significantly. “When I initiated the transformation in 2018, the ratio was 1:4.3. Today, we’re almost running at 1:10. For every dollar spent, we receive $10 in return,” he proudly declares.

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Tata Steel’s dedication to innovation doesn’t go unnoticed in the industry. Recently, there have been reports of Tata Group’s collaboration with a US-based chipmaker, NVIDIA. This collaboration will advance its AI capabilities further. This partnership aims to boost India’s artificial intelligence and semiconductor chip ambitions. It will foster indigenous technological advancements.

Tata Projects has also announced its partnership with Micron Technology. They will construct an advanced semiconductor assembly and test plant in Sanand, Gujarat. The project, situated in the Gujarat Industrial Development Corporation area, spans a vast 93 acres of land.

This monumental project aligns with the India Semiconductor Mission (ISM). It includes constructing a dynamic random access memory (DRAM), non-volatile flash memory assembly, and test facility. This is the first of its kind in India. Modern construction methods and techniques, integrated EPC delivery through 4D BIM, and hybrid modular accelerated construction will be employed to ensure sustainability and efficiency. The facility will be designed according to the LEED Gold Standards of the Green Building Council. It will also incorporate advanced water-saving technologies.

Union Minister for Electronics and Information Technology of India, Ashwini Vaishnaw, marked a significant moment as he attended the country’s first semiconductor plant in Gujarat. This event represents Indian Prime Minister Narendra Modi’s vision of a self-reliant India in technology and innovation. Vaishnaw believes that the construction of the semiconductor plant would be completed soon. The first indigenous microchips will roll out by December 2024.

The $2 billion in savings achieved by Tata Steel through AI-driven initiatives is just the beginning of a transformative journey. It promises to revolutionize the Indian business landscape. With technology as the driving force behind their success, Tata Group’s collaborations and investments are reshaping industries. They are contributing to India’s technological advancement and self-reliance on the global stage.