Global direct reduced iron production exceeds 140 million tons, India leads a new wave of growth

The "Data" points out that the growth of global direct reduction iron production in 2024 is mainly driven by the production of direct reduction iron using India's rotary kiln process, with an increase of 5.6 million tons, an increase of 13.9%. However, India's gas based vertical furnace direct reduction iron production has slightly contracted by 300000 tons, a decrease of 0.4%. The combined direct reduced iron production of India and Iran accounts for over 60% of the global total, with year-on-year growth of 10.9% and 2.1% respectively. Last year, Algeria, China, and Iran all put into operation new natural gas based direct reduction iron production capacity. Overall, by 2024, the top five direct reduced iron producing countries in the world will be India (54.7 million tons), Iran (34.1 million tons), Russia (8 million tons), Saudi Arabia (6.6 million tons), and Egypt (6.4 million tons).

According to the Sponge Iron Manufacturers Association of India (SIMA), India continues to maintain its position as the world's largest producer of direct reduced iron, with a production of 54.7 million tons in 2024, a year-on-year increase of 11.1%. Among them, the direct reduced iron production from rotary kilns increased by 13.9% year-on-year in 2024, following a growth of 12.8% in 2023, 17.8% in 2022, and 18.7% in 2021. Iran's direct reduced iron production reached 34.1 million tons in 2024, an increase of 2.1% from 33.4 million tons in 2023. All production comes from natural gas based processes, including Midlake ® （MIDREX ®） The direct reduction of iron production by the process accounts for about 90%. Three new factories will be put into operation in Iran in 2024. Russia maintains its position as the world's third largest producer of direct reduced iron with a production capacity of 8 million tons, all produced using natural gas based processes. Saudi Arabia maintains fourth place with a production of 6.5 million tons.

According to "Data", global direct reduced iron production has increased by 66.2 million tons over the past 10 years, an increase of about 89%, with a compound annual growth rate of 6.6%. Among them, the production of vertical furnace technology increased by 35.9 million tons, with a growth rate of 60.6% and a compound annual growth rate of 4.9%; The rotary kiln process increased by 30.3 million tons, with a growth rate of 197%, and a compound annual growth rate of 11.5%. In addition, Hot Direct Reduced Iron (HDRI) can be directly supplied to nearby steel mills to achieve energy conservation and efficiency improvement. In 2024, the global production reached 17 million tons, a year-on-year increase of 13.5%, accounting for 12.0% of the total global direct reduced iron production in 2024; Hot pressed block iron (HBI), as a direct reduced iron suitable for electric arc furnace and blast furnace processes, has an estimated production of 11.2 million tons, a year-on-year decrease of 8.3%.

At the same time, the world is equipped with Midlake ® The direct reduction factory of the process will produce 76.2 million tons in 2024, a slight increase of 0.6% from 75.7 million tons in 2023, setting a new record for two consecutive years. Midlake ® The direct reduction iron production of the process accounts for 54.1% of the total global direct reduction iron production and 80.1% of all vertical furnace process direct reduction iron production.

According to "Data", natural gas is usually the main reducing gas for vertical furnace processes. Compared to direct reduction iron produced directly from coal using rotary kilns or indirectly from coal using coke oven gas in vertical furnaces, natural gas based direct reduction iron has lower carbon dioxide emissions. For factories with mixed gas sources, the direct reduction of iron production is calculated based on the energy equivalent ratio. In 2024, approximately 65.7% of global direct reduced iron will be natural gas based, also known as "low-carbon emission direct reduced iron", while the remaining 34.3% will be coal based, also known as "high carbon emission direct reduced iron". Due to the rapid growth of direct reduction iron production using rotary kiln technology in India, the proportion of "low-carbon emission direct reduction iron" has continued to decline in the past four years. More noteworthy is that India's coal based direct reduced iron production will constitute the main source of "high carbon direct reduced iron" globally in 2024.

Since 1970, the global cumulative production of direct reduced iron has reached 2.4 billion tons, of which the production of vertical furnace process (cold direct reduced iron) has reached 1.9 billion tons, the cumulative production of hot pressed block iron since 1977 has reached 251 million tons, and the cumulative production of hot direct reduced iron since 1998 has reached 181.3 million tons. By the end of 2023, Midlake will be equipped globally ® The cumulative production of various types of direct reduced iron (cold direct reduced iron, hot direct reduced iron, and hot pressed block iron) in the direct reduction factory of the process has exceeded 1.46 billion tons.

Midlake also introduced the influencing factors behind the trend of global direct reduction iron production changes in "Data".
It indicates that the production of directly reduced iron is deeply influenced by steel demand, iron ore prices and supply conditions, as well as energy costs. Whether it is natural gas or coal, as a reducing agent in the direct reduction of iron production process, energy cost is often the biggest variable causing differences in production costs among different production plants. The degree of influence of these factors varies significantly depending on the region and technology type, namely gas based or coal based production. On the one hand, global crude steel production remains a key indicator for measuring global steel demand. According to statistics from the World Steel Association, the global crude steel production in 2024 was 1.885 billion tons, a decrease of 1.0% from the revised 2023 production of 1.904 billion tons. Major steel producing regions have generally experienced production cuts, reflecting weak demand in the global construction and manufacturing industries as well as profit pressures faced by steel companies. The exceptions are India, Türkiye and Vietnam, which achieved year-on-year output growth through domestic stimulus policies, capacity expansion and competitive exports. China's crude steel production has experienced the largest decline, with a decrease of approximately 24 million tons. Despite the relatively strong demand for steelmaking based on direct reduced iron, the overall trend continued to decline throughout last year. The decline in steel prices far exceeded the decrease in raw material costs, resulting in a significant compression of the profit margin of the steel industry throughout last year. On the other hand, global iron ore supply will remain relatively stable in 2024, with prices showing a downward trend throughout the year and a narrower range of fluctuations compared to previous years. Last year, the highest price of 62% grade iron ore appeared in early January, the lowest price appeared in September, and remained stable at around $100/ton at the end of the year; The prices of pellet and directly reduced pellet continue to decline.

Midlake's annual compilation and publication of 'Global Direct Reduction Statistics' has become an important reference material for the global steel industry. The World Steel Dynamics Institute (WSD) conducted an independent audit of Midlake's data collection and organization process, confirming that the statistical methods and accuracy of its published data were in line with the actual development status of the global direct reduction iron industry that year.