[...] propose 3 possible methods to combat the following situation. [...]
[...] I have been looking into several types of sensors [...]but have not found a
I'm not sure if you want to detect a possible problem or you just wanna handle it (which can be done without sensors)?
[...] a friend suggested i look at Location Sensors??? but as yet i have not found any existence of these? If possible has anyone got any suggestions or links that may be helpful?
Depending on the shape repeatability of the billets, detection could be done by measuring the capacitance between this and a few (isolated) areas on the clamp that holds it. Infrared position detection is another option.
Not knowing the exact wording of your assignment, I'd just go for a stiff (rotating?) brush, sweeping the clamp between each billet - whether it's clean or not, as this can be done very fast and with little cost overhead.
In case of further questions... Adding sketches/photos and a precise description is a very good idea.