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 - 20

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

Global Direct Reduced Iron Market will witness 8.6% CAGR between 2023 and 2032. The increasing demand for steel production, especially in developing economies, necessitates a consistent supply of reduced iron as a key raw material. Environmental concerns have favored the adoption of cleaner and more energy-efficient ironmaking processes, boosting the use of reduced iron. The construction and automotive industries are significant consumers, further fueling the market's expansion. Moreover, technological advancements and innovations in iron production methods contribute to the reduced iron market outlook.

Besides, rising investments from leading companies support market growth. For instance, in September 2023, Vale International, a global mining leader, signed a contract to provide iron ore to Essar Group's green steel venture in Saudi Arabia, as reported by Essar Group. Essar is making a significant investment of around USD 4.5 billion to establish an integrated steel facility in Ras Al Khair, Saudi Arabia, featuring a direct reduced iron (DRI) capacity of 5 million tonnes per year.

The overall Direct Reduced Iron Market is classified based on product type, application, and region.

The cold direct reduced iron segment will undergo significant development from 2023 to 2032. CDRI is an essential feedstock for electric arc furnaces in steel production, offering high purity and energy efficiency. As the steel industry looks for cleaner and cost-effective alternatives to traditional ironmaking methods, CDRI plays a pivotal role in meeting these demands, making it a sought-after choice in the reduced iron market share.

The electric arc furnace segment will register a commendable CAGR from 2023 to 2032. Electric arc furnaces rely on reduced iron as a primary feedstock for steelmaking due to its high purity and efficient melting characteristics. As the steel industry continues to embrace environmentally friendly and energy-efficient practices, the demand for reduced iron in EAFs remains robust, driving the direct reduced iron market growth.

Europe direct reduced iron market will showcase an appreciable CAGR from 2023 to 2032. The region's commitment to sustainable steel production and reduced carbon emissions has led to an increased preference for reduced iron in electric arc furnaces. For instance, as per the European Steel Association, it is projected that by 2030, approximately one-third of the steel produced through conventional blast furnace methods will transition to more environmentally friendly processes involving Direct Reduced Iron (DRI). Additionally, stringent environmental regulations and the pursuit of cleaner steelmaking processes contribute to the sustained demand for reduced iron in Europe, making it a pivotal player in the global market.