DRI Output Rises to 9.4m Tons

EghtesadOnline: A total of 9.46 million tons of direct-reduced iron were produced in Iran during the first four months of the current Iranian year (March 21-July 22), indicating a 10% rise compared with last year’s similar period, the Iranian Steel Producers Association's latest report shows.

News ID: ۷۴۸۲۳۳

25 August 2019

Mobarakeh Steel Company accounted for the largest share of the output with 2.56 million tons to register an increase of 7% year-on-year, according to the Iranian Mines and Mining Industries Development and Renovation Organization.

Following MSC, Khuzestan Steel Company was second on the list with 1.38 million tons (up 10% YOY), followed by Golgohar Mining and Industrial Complex with 935,764 tons, Hormozgan Steel Company with 536,509 tons (down 11% YOY), South Kaveh Steel Company with 490,293 tons (up 2% YOY), Chadormalu Steel Company with 476,694 tons, Khorasan Steel Company with 467,580 million tons (up 14% YOY), Saba Steel Complex with 352,540 tons (up 1% YOY) and Middle East Mines and Mining Industries Development Holding Company with 271,023 tons (down 10% YOY).

Other major DRI producers included Sefiddasht Steel Company with 270,096 tons (up 50% YOY), Arfa Steel Company with 262,051 tons (down 12% YOY), Ghadir Iron and Steel Company with 252,639 tons (down 8% YOY), Neyriz Steel Complex with 230,669 tons (down 2 YOY), Sabzevar Steel Company with 229,267 tons (down 5% YOY), Shadegan Steel Complex with 186,462 tons (down 21% YOY), Mianeh Steel Complex with 157,143 tons (down 37% YOY), Saba Steel with 119,538 tons and Esfahan Steel Company with 50,711 tons (up 11% YOY), Financial Tribune reported.

Iran was the second biggest producer of DRI in the world after India, with 14.17 million tons during the first half of 2019 to register a 15.2% year-on-year growth, World Steel Association reported.

India, Iran's primary rival in DRI output, increased its four-month production by 6% YOY to 16.71 million tons.

Iran's production in 2018 stood at 25.54 million tons, up 31.6% YOY.

Mobarakeh Steel: World's Biggest DRI Producer

Iran's largest steelmaker Mobarakeh Steel Company is the world's biggest producer of direct-reduced iron.

The company, along with its subsidiaries, accounted for more than 43% of Iran’s total direct-reduced iron production last fiscal year (ended March 20, 2019) with output exceeding 10.5 million tons.

Located in southwestern Isfahan, Mobarakeh Steel Company has a remarkable share of 50% in Iran’s steel production. The company is the biggest steel producer in Iran, as well as the Middle East and North Africa region.

PERED Engineer

Iran is the engineer of the so-called direct-reduction technology called PERED, or Persian Reduction.

Invented and patented by Mines and Metals Engineering GmbH, an Iranian engineering company registered in Germany, China’s Shanxi Taihang Mining Company Ltd, known as CSTM, is now taking operational steps to apply PERED.

PERED technology, which makes optimum use of energy and raw materials, reduces production costs with the added advantage of being more environment-friendly compared to other direct reduction methods.

There are generally three methods for DRI production: HYL process, presently marketed under “Energiron” trademark, jointly developed by Tenova and Danieli; MIDREX Process patented by Midrex Technologies Inc. along with its parent company Kobe Steel Ltd; in addition to PERED.

The replacement of MIDREX and Energiron with PERED will cut production costs by lowering the required initial investment and operational costs. It is also more eco-friendly.

Speaking to Financial Tribune in an exclusive interview, Hossein Aziztaemeh, the engineering manager of MME, said a majority of DRI plants in Iran utilize the MIDREX reduction technology.

In PERED, the reduction process is known to be more efficient, employs improved cooling methods and cuts on pollutant gas emissions. With less heat, more homogeneous reducing gas, more controllable pellet feed and use of centrifugal compressors, PERED requires less water, electricity and gas to operate, alongside less operational and maintenance costs.

According to MME’s website, PERED can also produce cold and hot DRI, hot briquetted iron and combinations of all three.

Aziztaemeh said PERED has so far been used in three DRI plants in Iran, namely Shadegan in Khuzestan Province, Miyaneh in East Azarbaijan Province and Neyriz Steel Company in Fars Province. In addition, Kerman Province’s Baft Steel Complex plans to utilize the technology in the near future.

According to Aziztaemeh, in addition to the above-mentioned Chinese company, firms from Oman and India have also expressed interest in importing the Iranian technology.

The contract with CSTM to import the Iranian technology was signed in May 13, 2013. However, the implementation of the project was delayed over the years due to several reasons.

The Chinese did not find production of direct-reduced iron economically viable, but things changed after the Chinese government imposed heavy taxes on “unclean” industries, he told us.

Therefore, they decided to move toward more clean industries that are more viable.

CSTM is China's first company to use coke oven gas as an alternative to natural gas to produce DRI. Using MME’s production technology, service and equipment, the company aims to increase its iron ore processing productivity and reduce emissions.

Aziztaemeh said the project will become operational by the end of 2019.

MME has several main responsibilities, including offering engineering services, selling equipment (completely manufactured in Iran), enforcing supervision and offering relevant training.

The project in China is said to be Iran’s first PERED project outside Iran.

DRI, also known as sponge iron, is produced from direct reduction of iron ore in the form of lumps, pellets or fines by a reducing gas. It can be processed to create wrought iron.

Crude steel is dominantly produced using two methods: making cast iron in blast furnaces or using DRI and scrap in electric arc furnaces.

More than 70% of the world’s steel are made using blast furnaces, while Iranian steelmaking is mostly dominated by EAFs.

Choosing each production method depends on various parameters, namely raw materials and energy costs.

Blast furnaces require large quantities of coking coal, a product hardly available in Iran and costly to import. This is while the country enjoys huge gas and iron ore reserves, making EAFs much more desirable. The shortage of scraps has consequently driven steelmakers to use DRI.

With such a sizable production, cutting costs would give a considerable boost to the industry. And PERED is designed to do just that.