Direct Reduced Iron Market Size - By Product Type (Hot Briquetted Iron, Cold Direct Reduced Iron), By Technology (Gas Based, Coal Based), By Application (Steelmaking, Electric Arc Furnace, Basic Oxygen Furnace, Foundries), By End-use & Forecast, 2023 – 2032

Direct Reduced Iron Industry Analysis

Direct Reduced Iron Market size was valued at around USD 31.2 billion in 2022 and is estimated to reach USD 71.2 billion by 2032. The most significant demand driver for DRI is the growth in global steel production.
 

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As the steel industry expands to meet infrastructure development, construction, automotive, and manufacturing needs, the demand for DRI as a raw material for steelmaking increases. The availability and cost of scrap metal, another significant input in steelmaking, can influence the demand for DRI. The aforementioned factors are therefore expected to accelerate market expansion in the upcoming years.
 

The increasing use of electric arc furnaces and mini-mills for steel production drives the demand for DRI. EAFs rely on alternative iron sources like DRI to produce steel, making DRI an essential feedstock for these facilities.
 

DRI production relies heavily on the availability and cost of iron ore and natural gas. Fluctuations in the prices of these raw materials can significantly impact the profitability of DRI producers. Establishing a DRI plant requires substantial capital investment. The long payback period and high initial costs can be challenging for new entrants or companies operating with limited financial resources. DRI production is an energy-intensive process, primarily reliant on natural gas. Thus, the high-end pricing and risks associated with Direct reduced iron may drive down the acceptance rate, further hampering the direct reduced iron market progress.
 

COVID-19 Impact

Many DRI plants around the world had to temporarily shut down or reduce production due to the pandemic's impact on the labor force, health and safety measures, and restrictions imposed by governments to contain the spread of the virus. Shutdowns of construction, automotive, and manufacturing sectors resulted in reduced steel consumption, impacting DRI demand. Thus, the reduced number of COVID-19 cases and implementation of subsequent strategies by government and non-government organizations is anticipated to drive the market expansion.
 

Direct Reduced Iron Market Trends

Environmental concerns and a growing focus on sustainability were driving the demand for DRI as an alternative iron source. DRI production emits lower greenhouse gas emissions compared to traditional blast furnace-based methods, making it a more environmentally friendly option for steel manufacturers. Continuous efforts were being made to improve DRI production processes and technologies to enhance efficiency, reduce energy consumption, and lower production costs. Thus, the growing prevalence is expected to expedite the market demand.
 

Direct Reduced Iron Product Type Segmentation

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Based on product, the direct reduced iron market is segmented as hot briquetted iron, cold direct reduced iron. Hot Briquetted Iron held a majority market value of USD 16.3 billion in 2022. HBI is particularly well-suited for electric arc furnace (EAF) steelmaking, which has been gaining popularity due to its flexibility and energy efficiency. The increasing use of EAFs drives the demand for HBI as a preferred iron source. Moreover, an increasing usage will further accelerate the segment trends.
 

Direct Reduced Iron Technology Segmentation

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Based on technology, the direct reduced iron market is segmented as gas based, coal based. Gas based held a dominant business share of around 56% in 2022 and is expected to grow at a lucrative pace by 2032. Gas-based direct reduction technologies can use various gas feedstocks, such as natural gas and syngas, depending on regional availability and pricing. Gas-based processes generally emit fewer greenhouse gases compared to traditional blast furnace-based methods, aligning with sustainability goals.
 

Direct Reduced Iron Application Segmentation

Based on application the direct reduced iron market is segmented as steelmaking, electric arc furnace, basic oxygen furnace, foundries, other steel production processes. Steelmaking segment is anticipated to grow at 7.1% CAGR up to 2032. The growing use of electric arc furnaces in steelmaking, driven by energy efficiency and lower carbon emissions, boosts the demand for DRI as a preferred iron source for EAFs. Thus, the high-quality services and growing usage of Direct reduced iron in steel making are anticipated to expedite the business growth.
 

Direct Reduced Iron End-use Segmentation

Based on end-use the direct reduced iron market is segmented as construction, automotive, aerospace, machinery and equipment, electrical and electronics, renewable energy, others. Construction held a dominant market share in 2022 and is anticipated to grow by 2032. The demand for DRI in the construction sector is influenced by the growth of infrastructure projects, where steel is a key material.
 

Direct Reduced Iron Regional Analysis

U.S. direct reduced iron market is anticipated to expand at a significant pace from 2023-2032. The overall growth and health of the steel industry in North America play a significant role in driving the demand for DRI. As the steel industry expands to meet infrastructure development, automotive, and manufacturing needs, the demand for DRI as a raw material for steelmaking increases. Thus, the above-mentioned variables would augment the Direct reduced iron business growth in the North America positively.
 

Direct Reduced Iron Industry Leaders

Some of the major market players operating in the Direct reduced iron market are MIDREX Technologies, Hylsa S.A. de C.V., Kobe Steel, Jindal Steel & Power Ltd., Metinvest Holding LLC, Tenova HYL S.A., JSW Steel Limited, Qatar Steel Company FZE, Nucor Corporation, Essar Steel India Limited, JFE Steel Corporation, Iron Dynamics, LLC, Tata Steel Limited, NLMK Group among others. These players focus on strategic partnerships, new product launch & commercialization for market expansion. Furthermore, these players are heavily investing in research that allows them to introduce innovative products and garner maximum revenue in the market.
 

Direct Reduced Iron Industry News:

• In 2019, ArcelorMittal commissioned Midrex to design demonstration plant for hydrogen steel production in Hamburg.
   
• In 2019, Voestalpine AGopened high-tech steel research facility in Donawitz, Austria.
   

Direct reduced iron market research report includes an in-depth coverage of the industry with estimates & forecast in terms of revenue in USD Billion & Units from 2018 to 2032, for the following segments:

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Market, By Product type

• Hot Briquetted Iron
• Cold Direct Reduced Iron

Market, By Technology

• Gas based
•  Coal based

Market, By Application

• Steelmaking
• Electric Arc Furnace
• Basic Oxygen Furnace
• Foundries
• Other Steel Production Processes

Market, By End-use

• Construction
• Automotive
• Aerospace
• Machinery and Equipment
• Electrical and Electronic
• Renewable Energy
• Others

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Spain
  • Italy
• Asia Pacific
  • China
  • Japan
  • India
  • Australia
  • South Korea
  • Indonesia
  • Malaysia 
• Latin America
  • Brazil
  • Mexico
  • Argentina
• Middle East & Africa
  • South Africa
  • Saudi Arabia
  • UAE
  • Egypt