Sponge Iron industry
Kartavya Desk Staff
#### Facts for Prelims (FFP)
Source: FE
Context: India’s sponge iron industry faces an ore shortage due to rampant exports of iron ore, its crucial raw material.
About the Sponge Iron:
• Definition: Sponge iron, also known as direct-reduced iron (DRI), is produced from the direct reduction of iron ore (in the form of lumps, pellets, or fines) into metallic iron through a reduction reaction (chemical process) at high temperatures.
• Production Process: Sponge iron is produced by removing oxygen from iron ore through a reduction process in a rotary kiln or fluidized bed reactor. This process occurs at high temperatures (typically above 1000°C) and involves the use of reducing agents such as coal or natural gas.
• End Use: Sponge iron serves as a crucial raw material in the steelmaking industry.
• Advantages: Sponge iron production offers several advantages, including lower production costs compared to traditional steelmaking methods, higher purity of the final product, and reduced environmental impact due to lower emissions of greenhouse gases.
• Leading Producer: India has been the world’s largest sponge iron-producing nation since 2003, with 30% of India’s steel production coming from this route.
• Impact of Export: The shortage of Sponge Iron in India is attributed to the high rate of iron ore exports, leaving minimal quantities for domestic use by secondary steel sector players.
• Export Dynamics: Iron ore exports, including pellets, almost tripled in 2023, reaching 44 MT. This surge followed the withdrawal of export duty on ores with less than 58% Fe in November 2022.
• Policy Objectives: The National Steel Policy 2017 aims to increase sponge iron production to 80 MTPA by 2030-31 to achieve a targeted steel production capacity of 300 MT
• Calls for Action: Several state-based sponge iron manufacturing associations have appealed to the Union Steel Ministry to ban all forms of iron ore exports due to the severe shortage of raw material.