Optimization research on product combination of Steel Works based on Minimum Cost flow

China´s Steel Works are facing with intense competition environment, so scientifically rational product combination is the important foundation for an enterprise to achieve success in competition. This paper uses Network Chart to descript the production process of Steel Works, and transforms the product combination optimization problem of Steel Works into the Minimum Cost flow Problem based on Maximum Profit. It put forward the minimum cost flow model and network optimization algorithm based on three parameters which are production capacity, production cost and yield and gave a calculation example. The calculation example shows that the optimized product combination increases the profits than the original one and provides a quantitative reference for the decision-making of Steel Works on how to adjust product structure and obtain the maximum profit under the circumstance of fixed resources.