A Novel Sustainable Multi-objective Optimization Model for Steel Supply Chain Design Considering Technical and Managerial Issues: a Case Study

The iron and steel industry is one of the most resource-intensive and pollutant industries that creates the highest value across all mining and metal industries. While the recent studies provide recommendations to improve sustainable development in this industry, the complexity of the socio-environmental impacts of activities in this industry due to its multi-tier and multi-supply chain structures has given rise to the problem of sustainable steel supply chain network design. This work proposes a new multi-objective mixed-integer linear programming model to integrate sustainability factors with managerial and technical restrictions. The total economic profitability is maximized, while environmental pollution is minimized. There is also a focus on the social and environmental compliance. Accordingly, a novel sustainability assessment system is proposed. The managerial restrictions are also satisfied by maximizing the demand fulfillment priority using a new method. The augmented ε-constraint method is applied to tackle the mathematical problem under study. Finally, a real case study is used. The results obtained ۳۵% and ۴۱% reductions in CO۲ and particulate matter emissions, respectively, while the total profit decreases up to ۱۵%. A sensitivity analysis is also performed. In addition, several managerial insights are discussed based on the results.

Keywords:

Iron and steel industry , Supply chain network design , Sustainability assessment system , Demand fulfillment priority , Multiobjective Optimization