Proposal of Support Planning System for Magnesite Mining Operations Based on an Assortment Volume Sale Forecasting

Abstract In the long term, the mining industry can be regarded as market volatile in terms of commodity price movements and sales. Although the general demand for raw materials is increasing, volatility in the different segments of the industry is visible. This paper presents a model for production planning system based on forecast for streamlining Magnesite assortment production in a prominent mining company in Slovakia. The forecast is based on several approaches i.e. quantitative approach – ARIMA method and regression and qualitative-probabilistic approach will be formed by the relevance tree method and discrete Markov chain under the final corrections of an expert (planner). The aim is to provide a medium-term production outlook over a 2-year time horizon for total magnesite production at active mining operation in Slovakia. The planning of magnesite production or extraction is thus based on the forecasted demand for particular processed product ranges in which magnesite is significantly or fully represented. Compared to the previous on-demand planning method, this innovative and implemented system has resulted in a more even production and a reduction of extracted magnesite stock by approximately 20%.