Title: Demurrage cost reduction in cement manufacturing plant

Authors: G.S. Dangayach; Ankit Jain

Addresses: Department of Mechanical Engineering, Malaviya National Institute of Engineering and Technology, Jaipur, India ' Department of Mechanical Engineering, Malaviya National Institute of Engineering and Technology, Jaipur, India

Abstract: The purpose of this paper is to discover the possible ways to improve material handling which results in the saving of demurrage cost which has to be paid by the cement company as penalty. This paper describes the problems associated with material handling in cement plant which results in increase of demurrage cost. It suggests the possible ways by which the demurrage cost can be minimised resulting in profit to the company. Demurrage cost involved in material handling is a vital part of cement manufacturing process thus its importance cannot be neglected. Process chart was used to analyse the existing procedure of loading cement bags and loading clinker into trains. Queuing theory and layout planning along with process chart have been used in order to improve and reflect on the results obtained before and after improvement in material handling. This paper gives the practical application of tools like process chart and queuing theory in order to reduce the demurrage cost.

Keywords: demurrage cost; materials handling; process charts; queuing theory; demurrage hours; freight wagons; cement manufacturing; operations management; Indian railways; layout planning; India; cement bags; cement loading; clinker loading.

DOI: 10.1504/IJSOM.2015.072317

International Journal of Services and Operations Management, 2015 Vol.22 No.3, pp.363 - 393

Received: 21 Mar 2014
Accepted: 02 Jul 2014
Published online: 09 Oct 2015 *

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